According to Bloomberg News and Chinese economic media CheilJaekyung on Monday, Starbucks China recruited Yang Chun (Tony Yang) as its CGO last month. It is the first time that Starbucks China has CGO.
Yang, the new CGO, is a former head of user development at electric vehicle company Ziwe Automotive, which was founded in 2021 in a joint venture between China’s largest search portal Baidu and Geely Motors, which owns the Volvo brand.
Starbucks China said Yang CGO will pursue a marketing strategy through collaboration with entertainment franchises and pop culture icons, stressing that “China is an important growth engine for the future.”
Yang CGO will be briefed by Starbucks China’s product development, R&D and marketing departments, and his role will also focus on coffee product innovation and improving customer experience, Bloomberg said.
In September, Starbucks China reorganized itself from co-CEO Wang Jingying (Belinda Wang) and Liu Wenjuan (Molly Liu) to CEO Liu’s sole. Wang retained his position as chairman of Starbucks China.
The changes at Starbucks China, which have followed the inauguration of Starbucks CEO Brian Nicholl in September, are seen as a way to overcome a slump in China, the largest market outside the United States.
Starbucks is operating more than 7,600 stores in China, or about 20% of the world’s stores as of September, and is still increasing its stores, but it is struggling with sluggish domestic demand and fierce competition in China after COVID-19.
In particular, the decline in performance became clear, with sales falling 14% in the third quarter of this year as it fell behind in competition with local brands with low-cost policies such as Louising Coffee and Coty Coffee.
In comparison, Louis Xing Coffee exceeded Starbucks China’s annual sales in China for the first time last year. According to the Financial Times (FT), Louis Xing’s sales nearly doubled last year and opened 1,400 additional stores in the third quarter of this year, bringing the total number of stores to 21,300.
Accordingly, it was reported last month that it is seeking to reorganize its mainland business, including the possibility of selling its stake.
However, with the appointment of CGO, it is interpreted that Starbucks has shown its willingness to do business in China.
Bloomberg pointed out that Louising has recently boosted both sales and online buzz through collaboration with popular games such as “Black Myth: Okong,” and said, “Yang’s pledge to collaborate with pop culture franchises is to use brand power other than its own to save its Chinese business.”
SOPHIA KIM
US ASIA JOURNAL
