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South of the Clouds

“Have the Chinese beans arrived?”

  “Chinese beans?”

  Yes, you know… the Chinese beans.”  The furrowed forehead, pursed lips, and far-way stare told me that Lee didn’t know.  In fact, Lee (the name on his Starbucks’ badge) had absolutely no idea what I was talking about.

  “Chinese coffee beans,” I punted.

  “Ohh!  I see!  Coffee beans!” 

  Lee’s eyes beamed with pride: “They’re not here yet, but they’ll be here next week.  It’s really exciting, I’ll show you.”  With that, Lee literally ran toward the counter.

  I was still trying to work out what he would return with when, as quick as a flash, he re-appeared with a sticker that showed a brightly coloured bird.  The drawing looked like a cross between a chicken and a peacock, but I guessed it was meant to conjure up notions of a bird of paradise and all the exotic imagery that goes with it.  Above the chicken’s head were the words – written in the kind of soft typography you see these days in corporate end of year reports to help soften the hard blow – “South of the Clouds”.

  “I guess the beans are from Yunnan,” I said.

  Lee looked at me as if I were some kind of soothsayer.

  “That’s amazing!  How on earth do you know?”

  “Well, I’ve been there several times so I know that it’s mostly very sunny and that yun nan means ‘south of the clouds’.  I also know that coffee is grown there.  But, to be honest, the main reason I’m so sure is that I’ve also read about Starbucks getting beans from there.  The story has appeared in quite a few foreign newspapers.”

  “Really?!” said Lee, clearly pleased that Chinese coffee beans had, at last, bounced on to the world stage.

  But why, I wondered, had it taken so long for Starbucks to spot the quality-potential (not to mention the marketing and PR potential) of Yunnan coffee beans?  Yunnan, after all, produces about 30,000 tonnes of coffee beans a year; of which 70 per cent is exported.  Nestle, apparently, has been buying Yunnan coffee beans for ten or more years – or as least as long as Starbucks has been in China.

  The answer – according to the China Daily and others – is that “Starbucks has been working for three years with farmers and government officials in Yunnan to look for coffee beans that meet its strict standard”.   

  I don’t doubt this, but I’m not a great believer in coincidences either.  In 2008, Starbucks’ global net profit reportedly fell more than 50 per cent year-on-year. 200 stores in the US (where is has 11 thousand of its 16 thousand stores) have closed in the past 12 months; and its global expansion plans have been recently cut back. 

  Could it be that, these days, China – where it has 350 shops in 26 cities – has been getting more of the company’s top execs’ share of mind?  If it has, it’s not hard to imagine that they have concluded that the great hope for their business is China, where the coffee habit here is still in its infancy; and that one of the barriers to growth is negative PR. 

  The PR disasters of its very own “water gate” (the company’s former global policy of keeping a tap constantly running in all of its stores was widely reported here) as was the Forbidden City “incident” (when, following a reported public outcry, it was forced to withdraw from one of the bastions of national identity). 

  There is no doubt that the huge amount of positive PR they’ve received here in the past few weeks has gone down well and has pushed them that bit closer to their ultimate goal of making China their number one market. 

  It has been a great week too for Yunnan coffee.  What’s the betting that, when Nestle and other bulk buyers next come calling, they will find it that bit harder to drive a hard bargain.  After all, they now have Martin Coles, president of Starbucks Coffee International, fighting in their corner:

  "The essence,” he said recently, “is about how we create a presence of Chinese coffee in the world. I hope one day when I walk into a local store in Washington, my barista behind the counter would ask me to taste the South of the Clouds blend and tell me the story of the village from which it came."   

  Any story of Chinese brands going out there, and winning battles in the international arena, is bound to be widely reported here.  Likewise, any brand that fights on their side is also likely to enjoy good press.  So, talking up Yunnan coffee is also good for the brand that has obviously invested a lot of money, energy, and brain-power in the plan.  

  “South of the Clouds” is just one example of how companies are thinking differently about their marketing in China and leveraging innovative ideas (instead of “business as usual” marketing spend) to meet double-digit growth targets.  

  I’m looking forward to sitting down with some “bai ling” (white-collar workers) next week to talk about what they think of China’s very own coffee.  Not to mention sampling the brew myself.  In the meantime, I’ll have to settle for the Colombian coffee of the day and a muffin...

  But, what’s that?  Today’s special isn’t just any muffin...

 
  It’s a “Mandarin cranberry muffin” no less!       

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