Monday, February 27, 2006

I Can Market Anything

Sunday, December 04, 2005
Today I was awoken from my deep slumber at 7:00 am with a message from a colleague whose wife is applying for a public relations/marketing job at Starbucks. As happy as I was for him, I had to admit that I was a bit surprised that he wanted to call me in China just to inform me of his wife’s career goals. Of course it came out like “Do you have any fucking idea what time it is?”

“Yeah man, it’s like 5:00 pm.”

“Very funny, why are you calling me about this?”

He then went on a informational rant I can sum up by saying that part of her interview process required her to answer a handful of questions, a small number of those questions deal with doing business in China. Ahh, I thought, so we finally get to the crux of the contact. She wanted to talk to me and get my opinions or thoughts on the matter.

First of all, the only qualification I have to answer these questions is the fact that I’m living in China. Technically I live in a hotel, but that building is in China, so I live in China. I know nothing about marketing and even less than public relations. I know that many of these people may be the fakest people in the world, trying to explain to the rest of the world why their shit is good or their client didn't rape the child or that their cigarettes are the safe for kids (or is that lawyers? I always get mixed up).

As I enjoy talking, I ate up the chance to pretend to know what I was talking about. I will not bore anyone with the actual conversation, but what I will do is provide Starbucks with a complete analysis of how I think they can get their foot in the door and make China a good market for their stuff. I am doing this for two reasons; the first is my love for coffee. Coffee is good - I have stated that before. Coffee is black and makes my hands shake after more than five cups. Coffee makes me think of happy things, like not being tired, or omelets. The second reason is that I just felt like writing more about something other than my shortcomings as a lover, my faults as a person and my attitude about my job. Writing about something informative are very difficult for me, I find it hard to organize my thoughts into something that makes sense and ‘flows’ to a good conclusion, so here goes nothing.

First of all, I am speaking of Starbucks. I don't necessarily love them but I have no problems with the company, they have good coffee and seem to be open late nights and early mornings. They are a bit overbearing at times, but it’s a good place for people to get caffeine without being belittled by employees of the hip local neighborhood coffee shops for not knowing the difference between Americano and Macchiato (I do, however, hate that their sizes aren’t the universal small, medium, large unit of measure, but I digress).

Here’s the simple truth. Starbucks will never truly succeed here until they find a way to convince the people of China that coffee is good. I’ve been doing my best here to do that, but they just don't seem to share my enthusiasm (not for Starbucks, but just so that I can get it at more places). Chinese people don't do the caffeine thing like westerners do. I drink between 3-10 cups of coffee every day; most of the people in my office in Kansas City do the same. Chinese people drink tea, which has no caffeine in it. I’m talking Chinese hot-tea, not Lipton. Chinese tea is basically yard trimmings in hot water. Many Chinese people grow their own tea. It’s very cheap (and very flavorless in my opinion).

The fact that coffee is not popular here has absolutely nothing to do with Starbucks, but if they are going to succeed, they first need to put in a ton of money in convincing the people of China that coffee is good. I compare it to the ‘Got Milk’ or ‘Pork, the Other White Meat’ ad campaigns in America. These are not necessarily advertisements for specific milk brands, just something that raises public awareness. This is very important; most people here simply don't know anything about coffee. They know it exists, but many people have never tried it and none have ever seen a commercial for it.

How can we raise awareness about coffee in Big Red? Advertising here is a lot different than in America, but the basics still apply. Advertisements need to be placed where they can get the most traffic (I suggest whorehouses, just kidding…or am I?….). But in order advertise efficiently, we have to find a target market.

Starbucks isn’t going to put a franchise in Inner Mongolia (they’re no McDonalds…). The vast majority of the population is ineligible for getting ‘target market’ status based on things such as poverty and remote locations. But if you can reel in a couple target areas, the rest will follow. This is an all-or-nothing country. No one will step forward until one person moves forward, then everyone will follow in about a nanosecond. The key is isolating the parts of society that will be the most likely to step forward and embrace the Starbucks culture.

I see only two groups in the Chinese society that can manage this, and surprisingly, they’re not much different than target audiences in the Western world – university students and middle class businessmen. Both of these groups are likely to be ‘step-forward’ groups, for different reasons, and the actions of both of these groups will trickle down to separate other culture groups in China.

College students are the easiest. These people are just sheep looking for someone to tell them what the next cool thing is to do – how the hell else can you explain the insane popularity of karaoke here? The 18-23 year old class of Chinese citizens are absolutely desperate for entertainment and things to make them feel cooler. It may sound harsh, but it’s the plain and simple truth. Xinlei once told me that the cool kids in his university would spend up to four or five hours a day hanging out in McDonalds. I’m not talking about white-trash Chinese people, the cool Ablecrumbre and Fletch and Pumma wearing kids.

How do we (Why am I speaking like I work for Starbucks now?) approach this target crowd? I think it’s pretty simple. First of all, there needs to be an elevated presence of coffee on and around the universities. We are not dealing with highly mobile students, like in America. These people are about 99.99% car-less and, at the most, may have a bicycle. Chinese universities are basically gated self-sufficient communities, which makes it difficult to get an inside leg on the campus by the way of selling coffee and advertisements.

I suggest a method that is used in many American universities, a method that the students are nearly completely unaware of. It’s an idea that makes many people cringe, the same people that despise MTV and other representatives of ‘The Man’. Many companies in America hire students that are determined to be ‘cool’ and prostitute them out to the students of the school. These companies go through rigorous selection processes to find people that have a mixture of next-level type of style, are attractive and have cool personalities. These are the people that are always there when there is action, concerts, art openings, sporting events, their personalities naturally draw people to them and they are constantly talking and meeting people (not in that car salesman way, but real interest). They then have them hand out propaganda about different things around the school; stuff like stickers, demo cds, different types of things that may be appealing to a college student. Since this is coming from someone ‘cool’, the students take this stuff and advertisement accomplished. The cool kid loves the job because he knows everyone and gets tons of ass plus gets free clothes and other stuff. It’s a hard and time consuming job, plus they cant tell anyone who they work for and all that jazz that will tarnish their rep’. The students of China would bite into these type of people hook, line and sinker, without a doubt. It’s the easiest sell in the world.

Next you’d place a couple coffee shops around the university, have the cool kid get a group of friends to request coffee in cafeterias, once the cool kid and his ‘friends’ are seen drinking coffee all over the place, the neighboring coffee shops will become more popular than duck tongue and massage parlors.

High-school and younger aged kids in China will follow the university trends like the pied piper, now you’ve reached the 10-24 year old demographic. What power they do not wield financially they more than make up in sheer numbers.

The middleclass businessmen is the next group that I think should be targeted. They will not follow the university students, but there is something that they will follow – someone in a position of power telling them how good coffee is. You’ll notice that this is very similar to the college aged target, in fact, it’s the exact same, with a different method of goal achievement. The people of China will follow their superiors off the edge of the Great Wall like a bunch of lemmings, in fact, I believe that they do it so blindly that it goes completely unnoticed except from the untrained eye of an American who thinks it’s ludicrous. The key is trying to find the best person for that job.

I wouldn't know the best place to start on that, but keying in on international companies with western employees may be a good idea. Partnering with these companies to put the Starbucks logo on certain promotional items would be key. Free shit is always a good way to get attention. Having discounts for these companies for lunch catering meetings and industry conferences would work pretty well. The people will start seeing the Starbucks as more than a sign on a building or a commercial on television and start seeing it in action, in places where Chinese businesses notice them. Chinese businessmen are not immune to the ‘cool kid’ syndrome and once they see it as cool, everyone will follow in droves.

This will pull the entire workforce into the mix, admittedly it will take time for some, but once it the governmental personnel start to feel cool, you’ve gone a long way.

The basic fact remains that Starbucks will be considered a luxury for most people of China, but the prices for coffee here is actually cheaper than coffee in nearly every other establishment that sells it, so I don't think that lowering prices will do much to effect the market, in fact, once the public has bitten, the company will be able to slowly raise prices. Eventually, the market will level off with restaurants offering coffee at lower prices than Starbucks. Does that matter?
I say absolutely not. It doesn't take a marketing analyst to looking at places like McDonalds or KFC and realize how much the people here will bite into any bit of western culture they can. These two companies are, by far, the most successful western businesses in China. These places are considered cool places to hang out. These places are absolutely packed all the time. Why? Because they don't know how cool it is to hang at coffee shops…yet….

Unfortunately it’s not like Field Of Dreams, you simply cannot build it and expect them to come, people have to be coaxed into it.

Like I said earlier, I am not a marketing or public relations officer, nor do I play one on television. I have no doubt that this situation has been thought over in many meetings by Starbucks and similar companies in America and doubt that my insights have brought anything new to the table, but sometimes it’s just good to write something down and see how it sounds when you’re finished. Better luck next time.

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