Imagine an India where hundreds of millions of middle class Indians are idly sitting around in Starbucks all day sipping overpriced lattes, while even more hundreds of millions of lower class Indians were forced to watch in excruciating agony knowing they may never be able to step foot inside one of these stores. Yes, that is the image portrayed by the media and Indians themselves as Starbucks entered the landscape and lexicon of India in 2012.
Various sources have called Starbucks one of the most overrated things currently in India. One website even went so far as to list 10 reasons Starbucks is the Most Overrated Coffee Shop in India. Yikes!
As of February 2015, nearly 60 locations are open in 6 major metro areas: Bengaluru (Bangalore), Chennai, Delhi and Delhi NCR, Hyderabad, Mumbai, and Pune. Find a Starbucks. So, being the ever curious traveler of India, I popped into several Starbucks locations within Mumbai and Delhi on two separate trips spanning 2 years to see what all the fuss was about. With a little research and my own keen observation skills I found 10 reasons why Starbucks is relevant in India.
Starbucks in India: The Good, The Not That Bad, And The Facts
1. Duh, it’s a Foreign Brand…Kind Of
Indians love foreign brands.* In order for foreign corporations to operate in India, they must have a 50% partner of Indian origin. In this case Starbucks teamed up with TATA Global Beverages Ltd. to create TATA Starbucks Ltd. Read more about Brands of India: TATA.
*Most middle-class consumers regardless of where they live in the world love what is considered a foreign brand.
2. Fresh and Locally Themed Stores
Starbucks outlets around the world have been built with little deviation from the master cookie cutter design within the past 10 years. But Starbucks took a very different approach to India. Each store has been thoughtfully designed pulling in regional and city centric elements to create that WOW response most retailers can only dream of achieving. For example in Mumbai, at the store in Horniman Circle, customers will find hand-carved wooden screens, tables of solid Indian teak, painted vintage trunks and old leather-bound books, a nod at Mumbai’s mercantile past. Delhi’s Connaught Place location showcases a ropework design within the upper level ceiling symbolizing a local theme. And in Pune, the rich copper culture of the city is represented through copper artifacts and even a traditional Indian swing for customers to sway.
Call it pandering to your audience…I call it brilliant marketing. It’s a fresh concept not seen often in India for which the middle class has taken notice.
3. They Sell What They Source
Fun fact: Coffee beans are grown in India. That may seem ridiculous to mention to a number of readers however an even larger number of readers actually don’t know this and Starbucks is helping to educate the Indian population. That starts with the beans used in their espresso drinks. All Starbucks India locations brew 100% grown-in India beans roasted and packaged in Kushalnagar, Karnataka. This enables a circular financial effect within the Starbucks India ecosphere where in goods are sold in the cafes which is then used to plant, grow, harvest, roast and ship a fresh supply of beans to cafes around India. Profits trickle down to South Indian farmers and eventually into the coffers of India’s economy.
4. Starbucks and The Selfie Era
Giving the impression of wealth is certainly not a new concept in India. Cripes, Indians may have invented the notion of keeping up with the Jones’ (Singh’s) thousands of years ago. Starbucks fits into a wealfie generation quite nicely and locations situated in some of the highest rent districts across India’s largest metropolises plays right into that idea. A snap of you and your friends sipping on the company’s latest drink will elicit oooh’s and awww’s from followers. Right or wrong, agree or disagree, a certain percentage of daily sales comes simply from those that wish to brag publicly. Name any company not willing to develop a way to profit from this.
5. Breaking the Glass Ceiling of India?
Consider this like shattering the notion of India’s glass ceiling. The CEO of TATA Starbucks in India is Avani Saglani Davda, a mid 30’s female, and the youngest CEO in the TATA organization. After earning her MBA from Narsee Monjee Institute in Mumbai, she joined the TATA group and quickly began working her way up the ladder.
She is a prime example of the burgeoning India middle class and the core Starbucks India customer. Young enough to be taking selfies, mature enough to understand that Starbucks caters to all ages and backgrounds.
6. Overpriced Burnt Coffee
Cries over the cost and taste of a cup of Starbucks coffee are not new. The same conversation circulated the United States as the company enjoyed a meteoric rise in popularity in the 1980’s and 1990’s. Indians ask why you would pay Rs 200 for a latte when one can support the local coffeewalla down the street for Rs 50 per cup. Some of the same critics argue the coffee tastes burnt and doesn’t support the long legacy of great tasting coffee in India.
Starbucks customers aren’t just buying a cup of coffee. They are buying into a philosophy, crafted and constantly nurtured by feedback from Starbucks employees and customers. This philosophy includes paying a living wage that meets or exceeds India state standards. Employees also receive benefits: medical insurance, accident insurance, and statutory benefits as well as a 30% discount on all in-store items, stipulated coffee and food consumption in-store on all working days, and 6 months
maternity leave and 7 working days paternity for our partners (employees), as against 3 months
maternity leave stipulated by the Government.
Beyond wages and benefits, Starbucks provides an environment for people of all castes and backgrounds to work within a level playing field within the same building. It provides them with structure, a uniform, lessons on how to work with the public and each other, to show up on time on the appropriate day…concepts and ideals far outside the norm for the boy or girl who grew up in the village with little to look forward to than work in the fields or in the local coffee shop, wiping tables, and working for tips (if they were lucky).
And as for the taste of the coffee. Our palettes are as diverse as the Starbucks customer. For more than 40 years Starbucks has been roasting, brewing and serving their coffee around the world. Millions of cups of Starbucks coffee are consumed each day in more than 60 countries around the world. If, as the naysayers will claim, Starbucks coffee truly taste burnt or inferior to the competitor down the street, than why is this company so popular worldwide? Certainly it’s OK to not enjoy the flavor of the coffee, but to get as frothy at the mouth as a latte in a cup sharing your lack of discerning taste? That definitely is a burnt, bad tasting argument.
7. Tourists and Foreigners
Admit it. Sometimes you just want your usual. Even when in India.
It’s hot out, you’re grumpy, the bugs…oh! There’s a Starbucks!
Air-conditioned comfort along with the iconic green aprons and straws will surely put any tourist in a good mood. At the same time and rather unknowingly, foreigners are immersed in cutting edge Indian design, architecture, clashes of cultures, class, religions, food tastes, and history.
8. A Local Flare For Food
The menu at Starbucks reads like one you’d find at the corner dhaba. Murg Kathi Wrap, Murg Tikka Panini, Konkani Twist, Reshmi Kebab Roll, Tandoori Paneer Sandwich, blueberry muffin. BLUEBERRY MUFFIN?
Unlike Starbucks in the US, stores in India have a varied assortment that once again reflects regional and city tastes. Starbucks was able to tap into the power of TATA’s very own TajSATS, India’s largest provider of meals to domestic and international airlines, airports and hotels across the country. In short, they know Indian tastes and how to prepare it well. That includes blueberry muffins, because well, who doesn’t like blueberries.
9. Discrimination in the Workforce
Employment policy of Starbucks India: “All qualified applicants will receive consideration for employment without regard to race, national origin, age, sex, religion, disability, sexual orientation, marital status, gender identity or expression, or any other basis protected by local, state or national law.”
This is a great theory on paper and whether or not it is actually practiced consistently, it’s a huge step forward for the workplace in India.
10. A Place to Meet
Safe, neutral and near major businesses and transportation hubs, Starbucks is a go-to place for friends and businesses to meet. Throw in a warm calming environment free of TV’s and loud music, good lighting, high ceilings and large open spaces, comfortable seating, WiFi, and windows looking out on frenzied streets, you’ve got a recipe for attracting an Indian clientele en mass.
At nearly every location visited I encountered lines out the door. In one location a motley crew of elderly men could be seen huddled in a corner laughing over their drinks. To their left, two middle aged women discussed their maids and lack of cleaning standards. To their left, a group of 10 young male and female friends traded smiles and stories from the day before, all while texting and drinking their Starbucks.
At another location, tourists flocked inside to cool down from the mid-day heat scorching the concrete jungle of Delhi.
And at yet another location, businessmen in suits met to discuss strategy for an upcoming presentation. Seated next to them was an interview being conducted for what must have been a nearby company.
Glance around any Starbucks store in India to see how coffee, coffee, can bring together this crazy mix of beliefs, dreams, and morals, and then tell me how that is overrated.