This week, stories emerged about the potential of new competition in one of the largest markets for Starbucks. On the sunnier side of the news, the corporation shared information about larger marketing advancements. Overall, Starbucks experienced a bipolar week full of both good news and bad news for the corporation.
Before divulging into the larger news stories of the week, it is integral to look at the stock performance. Below is a recap of the rise of the stock price.
There was a sharp jump in the stock between closing on Monday and opening the stock on Tuesday. Overall, the rise in the stock shows a good pattern after the performance of the stock over prior weeks. Starbucks has shown mixed rises and falls in the stock with no clear direction of a pattern in the company’s performance. However, this slight rise to $84.21 USD at closing on Friday sets them up nicely for the beginning of the following week to increase the stock even more.
Now on the darker side of the news stories for this week, another coffee company has challenged Starbucks for the role of the hegemon in coffee shops in China. Customers are trading in their mermaid fins for antlers as the coffee shop brand Luckin Coffee has begun to rise to the top. Luckin helped establish their brand and raise their profits by offering a delivery service before Starbucks. Additionally, Luckin offers many options that Starbucks does not, such as the increasingly popular trend of bubble tea, leaving Starbucks out of the competition in this aspect. For these reasons, some predict that Luckin will be the top coffee shop in China by the end of this year. China is the second largest market for Starbucks, aside from the United States. Losing their dominance in China could significantly hurt the country. Since Starbucks has recently announced the pilot of their delivery service in certain US cities (a service that I mentioned in a previous blog post), they might have a chance of reclaiming their spot and widening the competitive margin.
As a palette cleanser from the previously dark news, Starbucks has created a new experience for customers that should peak their interest in the business at certain locations. On Friday, the company unveiled a Reserve Roastery in Chicago. A “Reserve Roastery” is an experience similar to “Hershey’s Chocolate World,” if you have ever traveled to Hershey, Pennsylvania. The Reserve Roastery gives you more information about the process from coffee beans to delicious drinks in your hands.
This is not the first Starbucks location of its kind. The Chicago destination joins the Reserve Roasteries located in Seattle, Shanghai, Milan, New York, and Tokyo. This worldwide tourist attraction allows customers from all over the world to learn more about where their coffee comes from. Additionally, it brings the Seattle-based company closer to customers around the world to maintain the relationship between the consumer and the brand. I personally would be interested in visiting one of these locations–I will keep you updated if I stop in New York over Thanksgiving Break.
Before I part, it is time to keep up with the weekly tradition of offering a drink recommendation. This week, I am recommending a toasted white chocolate mocha. I normally enjoy my caffeinated beverages over ice, but I could thoroughly enjoy this drink as simply hot coffee. It is getting progressively more difficult to think of drinks for my weekly recommendations, but the holiday season always offers new options for Starbucks customers. Until next week, I hope you enjoy the last week before the Thanksgiving madness.
Sources:
Jenna Kurtz 
it will be interesting to see how China works out; it seems like there would be enough customers there to keep both chains busy. Thanks for introducing me to a new word – hegemon! And I think you will make it to the end with your weekly recommendations, it’s one of my favorite parts of all the student blogs!
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