Milk and sugar in your coffee? Pretty normal… How about some olive oil? Not so much! Well that is exactly what Starbucks are offering in their latest line of beverages!
The coffee giant, with over 30,000 stores in 80 countries around the world, is taking a gamble on adding olive oil in their coffee as a way to separate themselves from the rest in what is proving to be a tough market to crack: coffee loving Italy!
Starbucks are hopeful that the Oleato will be a game changer. They have long struggled in Italy compared to other locations around the world as Italian coffee lovers tend to prefer independent local coffee shops.
The marketing maestros at Starbucks are hedging their bets that many consumers will be intrigued by the new option whilst many may come back for more given the well-publicized health benefits of consuming olive oil – something Italians swear by! In fact, it was on a visit to Sicily by the company’s CEO Howard Schultz which inspired the crazy concept to begin with.
The Oleato will soon be rolled out in other markets around the world including the UK, Middle East and Japan. Who knows if it will take off, but as the old saying goes… any publicity is good publicity!
THINK LIKE AN ECONOMIST!
Q1. With reference to the article above, explain the importance of innovation in a business growing their market share.
Q2. Explain why MNCs like Starbucks are more likely to take risks like the one described in the article.
Q3. What is meant by the phrase ‘any publicity is good publicity’ – how does that link to a company’s sales?
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