2.4¢ : The Green Mermaid Invasion

There is no way that we can talk about customer experience without mentioning Starbucks. The black magic of coffee began before 1000 A.D. when an Ethiopian man ate the same "cherrie" that made his goals unusually hyperactive. More than a thousand years later, we are still frisky about this magical liquid all over the world.

It's not the coffee itself but the customer experience of coffee has helped Starbucks become Fortune 500. Starbucks has done something remarkable: promote something that costs about 50 cents, sold it for $3.50, and still made customers crave it. They have figured it all out what exactly their clients want and deliver the same way every time. There is rarely any selling effort necessary after the brand equity and customer loyalty been established. In fact, when was the last time we see any Starbucks commercial on TV!!

When I grew up back in Taiwan, we didn't have coffee around. Because tea has been dominating in Chinese beverage culture for centuries, the grand opening of Starbucks coffeeshop in Taipei, Taiwan was just as revolutionary as the first coffee shop in the world opened in Turkey in 1475. In Westerne's mind, Chinese tea probably is as tastely as water. However, if you ever visit Taiwan, you would feel amazed by all the tea shops at every corners of the city. Tea beverage is sold hot and cold, mixing with juice, flavored syrup, herb and all different kind of condiments like jelly, tapioca and pudding. Most of all, tea beverage is cheap – averagely 50 cents per cup, so it is very popular all over Southeast Asia countries. However, Starbucks and its franchises came to this marketplace, where per capita GDP is only half of US (China is less than 1/10), still sold a cup of coffee for $3.50 US dollars and slam-dunked the beverage business in Taiwan and China.

Starbucks becomes so successful that they opened a hundred stores in just 4 years on the tiny Taiwan island of population at 22 million, and it plans to double the store number very soon. Starbucks prospers in Taiwan by single-handedly bringing in a great coffee experience. In additional to making customized beverage (same as the existing tea shops), Starbucks tailors its food menu to satisfy local favorite. There are much more selections than just pound cake and muffin. Furthermore, Starbucks created a welcoming environment in store internationally for people to socialize, which indeed is a unique attribute in Asian culture. Unlike Starbucks in US mostly serving professionals, where everything is drive-through or pick-up efficient, stores in Taiwan draw major crowds by dedicating an entire floor for students to study or people who want to have some quiet reading; other floors are regular hang out areas where people usually play poker/chest or have group meetings. Starbucks in Taiwan becomes more like pub for guys/girls to pick up or get picked up: the difference is people are paying a lot for coffee instead of paying a lot for beer.

Now when I drink Starbucks, I not only enjoy a cup of awesome coffee but also indulge in an extravagant experience or memory associated with it and some fun time I had in the stores. Hence, Starbucks has successfully transformed a commodity to a luxury. On the business side, there is lower GDP and cheaper everything from labor to material, Starbucks business soars in Asia without any marketing, promotion or advertising. That's a true tale about customer experience.