If you have walked into a Starbucks outlet since the brand began operations in India in late 2012, there’s little chance you’ve walked out without trying the Caramel Macchiato, or the Chocolate Cappuccino. Conspicuous by their absence, however, were ‘Indian’ beverages, like a Masala Chai or filter coffee — the lack of the latter being rather ironic given the coffee-loving South Indian markets. That is all set to change.
Starting this month, Tata Starbucks (the chain’s Indian joint venture involving Starbucks Corporation) has introduced a range of beverages to cater to Indian tastes, including Cardamom Chai, Masala Chai and Filter Coffee at its outlets in Bengaluru, Bhopal, Indore and Gurugram.
The chain has also introduced a range of milkshakes in popular chocolate, strawberry and vanilla flavours in these locations. Its cup sizes, here, have also turned a notch tinier, with the company introducing its ‘Picco’ size priced from Rs 165, allowing for smaller and less-expensive beverages.
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“We realized there were several consumers who have cravings for more familiar beverages like Masala Chai, and decided to launch these beverages that Indian consumers were more comfortable with,” said Sushant Dash, CEO, Tata Starbucks, in a chat with CNBC-TV18.com. “Our consumer insights also revealed that Indians generally don’t drink large quantities of beverages, so we felt that introducing smaller cup sizes was a holistic response.”
However, it isn’t just local flavours, smaller portions and competitive prices that Starbucks is experimenting with as part of this pilot. Other parts of its menu are all set to change too. The company has introduced a range of “bite-sized” portions and “shareables” priced from Rs 240 onwards.
The new menu offerings include a chicken club wrap, three-cheese pull-apart and a chocolate éclair, to address what Sushant believes were “gaps in the menu”, especially in terms of portion sizes.
What took so long?
However, the question remains: what took Starbucks a whole decade to address Indian taste-buds? “We knew that it was important to establish our core competencies in our initial years, including great coffee and warm stores,” said Sushant, “It is now only that we feel the time has come to leverage our equity in India and move beyond that.”
However, there’s no denying that a large part of these decisions — cheaper beverages and a more relatable, flexible menu in particular — could well be the response to competition. After all, RIL-owned Pret A Manger which announced its India launch a week ago is poised to give Starbucks and its 10-year-old Indian business, stiff competition. However, Starbucks insists that isn’t necessarily the case.
“We have always believed the market in India is large enough and there’s a lot of room for growth, for everyone,” Sushant said, “India is still largely a tea-drinking market, with coffee’s penetration still at about 11 percent, and this includes (coffee-loving) South India. Our decision has been made keeping in mind what the consumer wants.”
Starbucks’ latest additions to its menu, including the “shorter-than-short” cup size will be applicable to the four outlets that feature as part of the pilot. However, the company is considering the prospect of rolling them out across its 30 cities and over 200 stores based on its success rate.
First Published: Jul 11, 2022 9:19 PM IST
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