The Localization Strategy : A Adaptation Strategy

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Localization, also known as an ”adaptation strategy”, is a concept used for recognizing the inherent diversity of cultures existing in the international markets and treating particular individuals as “cultural beings” whose values and behaviors are shaped by the unique traditions of the society in which they live in. The localization strategy is geared toward understanding local consumers’ preferences and other locale-specific requirements and then directly adapting the marketing mix and other business strategies to best satisfy those particular consumers’ needs and wants. Since Starbucks primarily operates and competes in the retail of coffee and snacks store industry, it experienced a major slowdown in 2009 due to the recent economic crisis and consumers’ cut in spending. For 10 years preceding the economic crisis the industry had a consistent growth, however in 2009 the industry revenue declined 6.6% to $25.9 billion according to a reliable source.(Shultz). Economic slump affected consumers by forcing them to spend less on luxuries, e.g. eating out and fancy coffee, and purchase low-price items instead. From 2008 till 2013 the industry grew at a low annualized average growth rate of 0.9% with current industry revenues at $29 billion. It’s now forecasted to grow at an annualized rate of 3.9% over the next five years, with a potential to reach $35.1 billion revenues. This growth would be mainly driven by an improving economy, increase in consumer confidence and expanding
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