TECH STARTUP PRESENTATION

fiasco of starbucks in israel market

in 2001-2003

Kate Rogozhnikova

overview

01 Main mistakes of Starbucks

05 Economic consequences for Starbucks

02 Company’s environment

06 The mistake correction strategy

03 Aroma as a successful company

07 New country for Starbucks to start their business in

04 Сomparison of two launches

08 General conclusions

Mistaces of Starbucks

01

Why starbucks failed?

Starbucks did not adapt to the local culture

Israelis don’t drink much coffee

Starbucks Coffee Was Too Expensive

1. Why Starbucks failed in Israel : https://bettermarketing.pub/why-starbucks-failed-in-israel-7f0421c4ecd4 (20 октября)

Why starbucks failed?

The menu was not adapted to the Israeli market

The Israelis were loyal customers of their coffee shops

High competition in the city of Tel- Aviv

2. Why Starbucks failed in Israel : https://talkradionews.com/why-starbucks-failed-in-israel-7-reasons-why/#r (20 октября)

Company’s environment

pest

02

pest analysis of Starbucks environment in Israel market

Political

Armed conflict between Palestine and Israel (5)

Provision of state support to business (3)

the strongest impact on consumers

the weakest impact on consumers

3. Armesd conflict : https://ria.ru/20050208/22585518.html?ysclid=la9lwgv8kl4323056 (26 октября) 4. State support : https://www.kommersant.ru/doc/869337?ysclid=la9mg6fvme381944269 (26 октября)

Decrease in the influx of tourists due to the war (3)

Decline of FDI (4)

econimical

5. Tourism in Israel in 2001 : https://lenta.ru/articles/2002/02/19/israel/?ysclid=la9mrmin9o227455081 (26 октября) 6. Indicators : https://tradingeconomics.com/israel/foreign-direct-investment (26 октября)

The country is a supplier of agricultural products (3)

econimical

The buying power of the population has decreased (4)

5. Tourism in Israel in 2001 : https://lenta.ru/articles/2002/02/19/israel/?ysclid=la9mrmin9o227455081 (26 октября) 6. Indicators : https://tradingeconomics.com/israel/foreign-direct-investment (26 октября)

Decline of level of citizens' lives (5)

Increase in unemployment (4)

social

10

6. Indicators : https://tradingeconomics.com/israel/foreign-direct-investment (26 октября) 7. Unemployment : https://moluch.ru/archive/345/77719/?ysclid=la9mxwbys0162117693 (28 октября)

The government allocates money for the development of science (2)

technological

There is an opportunity to improve the technology of coffee preparation (3)

11

8. Government support : https://la-belaga.livejournal.com/201353.html?ysclid=la9ny4k4xg71045434 (28 октября)

Political

Armed conflict between Palestine and Israel (5)

economical

Decline of FDI (4)

social

Decline of level of citizens' lives (5)

Opportunity to improve the technology of coffee preparation (3)

technological

12

Company’s environment

swot

02

Advertising and promotion through films (4)

Strengths

(Internal)

14

9. advertising :https://vc.ru/u/1317608-vladislav-baturin/516742-89-filmov-s-reklamoy-starbucks-kak-razvivalas-krupneyshaya-set-kofeen?ysclid=lae4fvy0m9907351385 (28 октября)

Нigh customer orientationstrong brand (3)

Strengths

Strong brand and high reputation (4)

(Internal)

the strongest impact on consumers

the weakest impact on consumers

1 2 3 4 5

15

10. Customer orientation and brand name : https://www.profvest.com/2020/02/istoriya-kompanii-starbucks.html?ysclid=lae5ni7vtj790810416 (28 октября)

Prices depend on the cost of grains (5)

High product prices (3)

Weaknesses

(Internal)

16

11. Price : https://reviews.tn/ru/wiki/what-are-the-weaknesses-of-starbucks-2/?ysclid=lae5xhd2oi61975589 (28 октября) 12. Price of products: https://reviews.tn/ru/wiki/what-are-the-weaknesses-of-starbucks-2/?ysclid=lae5xhd2oi61975589 (3 ноября)

Opportunities

Developed agriculture in Israel (4)

(External)

Growing popularity of coffee (3)

A lot of labor resources (4)

17

Treats

Aggravation of the political situation (5)

(External)

Deterioration of the financial situation of citizens (3)

A lot of competitors (4)

18

11. Price : https://reviews.tn/ru/wiki/what-are-the-weaknesses-of-starbucks-2/?ysclid=lae5xhd2oi61975589 (28 октября) 12. Price of products: https://reviews.tn/ru/wiki/what-are-the-weaknesses-of-starbucks-2/?ysclid=lae5xhd2oi61975589 (3 ноября)

SWOT

Weaknesses

strengths

the growth of unemployment allows you to hire employees for a small salary

there is a chance to take a favorable position in the coffee market

opportunities

the traditions of the local population may be stronger than the brand and reputation of Starbucks

threat of closure

threats

19

Сomparison of two launches

03

Product

VS

high-quality coffee and a varied menu

coffee and American menu

21

13. Aroma : https://www.jpost.com/jerusalem-report/arts-and-culture/the-fragrance-of-aroma (1 декабря)

Price

VS

high price according to buyers' estimates

compared to Starbucks, the price is significantly lower according to consumer estimates

22

13. Aroma : https://www.jpost.com/jerusalem-report/arts-and-culture/the-fragrance-of-aroma (1 декабря)

Place

VS

Tel- Aviv , Starbucks has entered a very competitive market

Tel- Aviv , aroma already had its market share and loyal customers

23

13. Aroma : https://www.jpost.com/jerusalem-report/arts-and-culture/the-fragrance-of-aroma (1 декабря)14. Starbucks : https://www.starbucks.com/ ( 1 декабря)

Promotion

VS

cafe for business people, coffee connoisseurs

a traditional cafe that conforms to traditions and values for Israelis

24

13. Aroma : https://www.jpost.com/jerusalem-report/arts-and-culture/the-fragrance-of-aroma (1 декабря)14. Starbucks : https://www.starbucks.com/ ( 1 декабря)

Economic consequences for Starbucks

04

Starbucks is actively expanding around the world and its revenues are growing

26

15. Reports : https://s22.q4cdn.com/869488222/files/doc_financials/annual/2002/ar02_financials.pdf (28 октября) 16. Reports : https://s22.q4cdn.com/869488222/files/doc_financials/annual/2003/Annual_Report_2003_part2.pdf ( 5 декабря)

250.000 invested dilek and 60.559 starbucks

19.5

the costs were also small, so revenue eventually grows in all years

80.5

27

17. Cooperation with Delek : https://ru.wikibrief.org/wiki/Starbucks_Israel (28 октября)

The mistake correction strategy

05

include dishes for Israelis in the menu

release advertisement in an Israeli film

reduce prices by entering retailers

collaborate with the aroma coffee chain, make a common product to increase brand awareness

29

New country for Starbucks to start their business in

06

Finland

The largest consumption of coffee in the world

cultural sphere

Finns appreciate the variety of both coffee and desserts with coffee

They like to buy coffee everywhere and at any time

31

18. Culture of coffe : https://coffeefan.info/kakoj-kofe-v-finlyandii.html?ysclid=lbaojjgged97067132 (15 декабря) 19. Culture of coffe :https://terve-suomi.com/shopping/666-finskij-kofe-ili-istoriya-natsional-noj-lyubvi.html (15 декабря)

Finland

Finland went through the crisis of the 90s, namely in the 2000s it began to develop and gain altitude

economical sphere

Rise of FDI

32

16. Indicators : https://tradingeconomics.com/israel/foreign-direct-investment (15 декабря) 20. Crisis of Finland : https://economics.studio/mirovaya-ekonomika/mesto-finlyandii-mirovoy-98173.html(15 декабря)

Finland

Active cooperation with other successful powers like Great Britain, Sweden, Germany, USA, low trade barrier

economical sphere

The costs of buyers are growing

33

16. Indicators : https://tradingeconomics.com/israel/foreign-direct-investment (15 декабря) 20. Crisis of Finland : https://economics.studio/mirovaya-ekonomika/mesto-finlyandii-mirovoy-98173.html(15 декабря)

How to adapt starbucks to the Finns

make a focus on the variety of menus

make, for example, a set of drinks + dessert for different ages of customers

come up with different recipes for the strength of coffee

34

General conclusions

06

it is necessary to analyze the cultural environment of the country

it is necessary to change the product for consumers

it is necessary to analyze environmental conditions and study consumer behavior

to reduce risks, you can cooperate with other companies

36

THANK YOU!