Don’t assume the market is willing to jump on board
The coffee behemoth Starbucks is obviously all over the world today. Their empire stretches the entirety of North America, most of Europe, and the majority of South America, Asia, and Oceania & Australia. In total, 28.2k locations across 76 countries.
“The empire on which the sun never sets” is most certainly true.
But this doesn’t mean Starbucks has done well in all of these places. Australia, in particular, has been anything but smooth sailing.
In 2008, after nearly a decade of rapid expansion across the continent, Starbucks made the decision to close over 70% of its 87 stores. The company found itself in a downward spiral of annual losses and something had to change.
At the time, the coffee culture in Australia wasn’t prepared for what Starbucks was offering. Specialty, sugary drinks, higher priced options, and the bustling, quicker-paced environment didn’t vibe with the Aussie patrons.
Coffee is a sacred experience in Australia, especially espresso (introduced in the mid-20th century by European immigrants), a key ingredient of the revered flat white beverage. The idea of a coffee house is also more than just a place to grab a coffee or work remotely; it’s a meeting ground, where the barista knows you by name and a sense familiarity lives.
Starbucks busted into the market offering the exact opposite of what it’s potential customers expected. They tried to build an empire like they did everywhere else and it backfired.
What Starbucks did wrong in the early 2000s was simple: they misjudged their popularity.
Regardless of whether you’re a coffee giant or a small consulting firm or a mom-&-pop retail shop, don’t ever misjudge what you think the market wants.
Don’t mistake short-term hype for potential long-term popularity.
Don’t assume the market is ready for you or willing to jump on board.
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