1 Flashcards
Luckin Coffee was the first and main protagonist regarding the gain of popularity of coffee in China.
False : Starbucks played a major role earlier, which was probably one of the reasons Luckin was able to get success as it arrived into the market.
Starbucks was able to reinforce its place on the coffee market by sticking to its “the third place” strategy
True
After the fraud scandal of Luckin Coffee, the chief executive and operative officers were terminated and forced to resign from the board of directors
True
When positioning in a market, it is important to pay attention to the business model adopted by rivals to be able to compete with them with the same strategies.
False : it is important for them to develop a differentiation strategy to set apart from them
It is difficult for Starbucks to compete directly with Luckin Coffee as they have opposite strategies and respond to different needs and targeted customers.
True
Starbucks made coffee popular a short time after it introduced coffee to China in the 21st century
False : Coffee was introduced in China in the 19th century, a long time before Starbucks came.
It was easy for Luckin to quickly gain net income when it entered the coffee market, as it was in a blue ocean context.
False : Although Luckin did arrive in a blue ocean context, it was near from bankruptcy during all of its first years. Remember the most common reason start-ups fail is lack of cash to survive getting launched.
Lower pricing requires bigger sales to be profitable, so Luckin used online orders, combined with self-pick up or takeout to expand sales.
True
According to the PEST analysis of the macro environment of the coffee culture in China, one of the biggest threats to the industry is the lack of interest for coffee of young people.
False : It’s the opposite.
Chinese people now have the different habits to drink coffee than western countries.
True : They have different preferences for various components of the coffee culture, such as the flavours or towards the take away concept.
COVID did not change anything in the coffee industry in China.
False : It did increase the number of people who would choose take away coffee.
The Coffee market is now saturated in China, due to the duopoly of Starbucks and Luckin.
False : The group believes there is still a blue ocean in lower-tier cities in the northern China, targeting at the young generations.
According to Porter’s five forces model, the costs of adaptation would represent a barrier to entry for foreign companies.
True
According to the 4Ps strategy, the product that Starbucks sells is not limited to the coffee itself but to the entire experience through the 3rd place strategy.
True
Taken into account the actual strong brand image of Luckin Coffee, the use of AI and big data won’t be as useful in the future.
False : It does represent a huge advantage over its actual and potential future rivals.
All BUT one of the statements below represents threats to Starbucks, as it settled in China:
China didn’t have a coffee culture, as it had a long-time tea tradition
The flavours of coffee weren’t adapted to Chinese people’s tastes
Chinese products had a low quality reputation at that time . This was part of the opportunity for Starbucks.
Chinese products had a low quality reputation at that time . This was part of the opportunity for Starbucks.
Which of these factors represent barriers to entry for potential new entrants in the coffee market:
Main actors concentrated in a duopoly
Brand loyalty already built by Luckin Coffee through its data and Starbucks through its brand image
All of the above
All of the above
According to Porter’s five forces model, which one of these factors represents a weak force in the customers’ bargaining power of the coffee industry
Highly fragmented customers
Low switch costs
Many substitutes
Highly fragmented customers
All BUT one of the statements below are true:
The use of AI made by Luckin Coffee was a key factor of its success
Luckin had an advantage over Starbucks when it started, as it sold coffees more adapted to Chinese people’s tastes (Explanation: Not at the beginning.)
The fraud scandal didn’t have a huge impact on the consumers’ behaviour towards Luckin Coffee
Luckin had an advantage over Starbucks when it started, as it sold coffees more adapted to Chinese people’s tastes (Explanation: Not at the beginning.)
All BUT one of the statements below are part of Starbucks strategy:
Frequent discounts and cheap prices
3rd place strategy
Highly qualitative products
Frequent discounts and cheap prices
All BUT one of the statements below are false:
The ambitious objectives set to Luckin’s employees led to a constantly increasing success
Part of Starbucks adaptation and promotion strategy was to provide a great help to its employees, as it settled in China
Coffee from coffee machines represents a direct threat of substitute for the Coffee provided by Luckin
Part of Starbucks adaptation and promotion strategy was to provide a great help to its employees, as it settled in China
All BUT one of the statements below are part of Luckin’s strategy:
Fast adaptation and growing
Importance given to the feedback of its customers and employees
Creating a luxurious dining environment
Creating a luxurious dining environment
Which one of these factors represent positive opportunities regarding the blue ocean strategy:
There is a growing middle class in China
There is an unmet demand in a matter of coffee drinking for the purpose of losing weight and fat
All of the above
All of the above
Which one of these factors should NOT be included in the economic analysis of the macro-environment of China’s coffee market:
Per Capita GDP
Consuming Willingness
Mobile Payment
Mobile Payment
Which one of these factors is NOT a characteristic of China’s coffee market in 2022:
Various consumption scenarios
Slowdown in growth rate
The rise of middle class
Slowdown in growth rate
Which of the following brands is among the top five brands in terms of market share in China’s coffee market in 2022:
Tims China
Manner Coffee
Pacific Coffee
Tims China
Which of the following statements is TRUE:
The eastern part of China has the most coffee brands.
The coffee market in northern China does not have growth potential.
South China has large population, so the coffee market in South China is a blue ocean.
The eastern part of China has the most coffee brands.
Which of the following statements is TRUE:
From the perspective of consumers’ age, the 1980s generation loves coffee most.
In second-tier cities and above, the most popular coffee drinkers are 25-34 years old.
In first-tier cities, Starbucks’ largest consumer group is 25-34 years old.
In second-tier cities and above, the most popular coffee drinkers are 25-34 years old.
“Think Globally, Act Locally”. Which Starbucks initiative best embodies this philosophy:
Create a comfortable in-store environment
Provide various peripheral products, such as mugs
Develop new flavors according to consumer preferences
Develop new flavors according to consumer preferences
According to Porter’s Five Forces Model, which of the following force is low for Luckin Coffee:
Rivalry amongst competitors
Threat of new entrants
Bargaining power of suppliers
Bargaining power of suppliers
