As free wi fi and classy cafe ambiance were also made

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as free Wi-Fi and classy cafe ambiance were also made available by other competitor, even in a more competitive price charged. Management Perspective Several key lessons can be learnt from the failure of Starbucks in Australia. Starbucks could have uncovered the extent of the coffee culture existed in year 2000 if they have done market research before entering a market. As a late market entrance, due to diligence, the international organization failed to do thorough homework on the market before entry. Australia has an extremely 9
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mature and competitive café market in contrast to Asian territories where coffee houses didn’t exist. Starbucks failed to communicate its brand to consumers when they did not advertise on mass media but only relying on its reputation. Chen and Hu (2010) suggest that the rational benefit and the perceived value is crucial in enhancing the vaue perception of a customer. When an Australian customer visit a coffee shop, they expect to be recognized by name by the employees and will offer a great service. Moreover, study shows that relational benefit has direct effect on customer loyalty. When Starbucks failed to understand its customer’s experience and the foundation of coffee shops, the organization failed to keep their customer loyal and will fail like a leaky bucket. Conclusion The lessons from Starbuck’s failure in Australia demonstrated to businesses the importance to understand a market before entering, and methods and strategies that works in one place might not also bring success elsewhere. Even a well- known and well liked brand should adapt their product and service for local tastes. In conclusion, observational and ethnographic researches are very important for an international business prior entering a foreign market. References Chen, P, Hu, H 2010, “The effect of relational benefits on perceived value in relation to customer loyalty: An empirical study in the Australian coffee outlets industry ”, International Journal of Hospitality Management, Vol. 29, Issue 1, pp. 405-412. Han, G, Xhang, A 2009, “Starbucks is forbidden in the Forbidden City: Blog, circuit of culture and informal public relations campaign in China”, Public Relation Review , Vol. 35, Issue 1, pp. 395-401. Jones, P & Robinson, P 2012, Operations management, Oxford University Press, United Kingdom. Marques, J 2008, "Spiritual performance from an organizational perspective: The Starbuck’s way", Corporate Governance: The international journal of business in society, vol. 8, no.3, pp. 248-257. Mattila, A.S., 2004, “Consumer behavior research in hospitality and tourism journals”, International Journal of Hospitality Management , Vol 23, Issue No. 5, pp. 449–457. McDougall, G.H.G., Levesque, T., 2000. Customer satisfaction with services: putting perceived value into the equation. Journal of Services Marketing, Vol. 14, Issue no. 5, pp, 392–410.
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