Earth Day is an annual event on 22nd April to demonstrate support for environmental protection. First held on 22nd April, 1970, it has become an annual appointment to celebrate our planet and launch initiative to preserve it.
Retail in Asia had the pleasure to interview Sara Trilling, president, Starbucks Asia Pacific about the development of the brand in South Korea and sustainable initiatives recently launched in the market.
RiA: South Korea has been a flourishing market for coffee, how has Starbucks evolved in the market?
Sara: Since entering the market in 1999, Starbucks Coffee Korea has grown rapidly to become Starbucks fifth largest market, with more than 1,500 stores across 78 cities nationwide.
Throughout the years, we have continued to create long-term, purpose-driven impact on the market by focusing on the things we value most – our coffee, our people, and our planet.
Given the unique and diverse nature of the region, it is important to innovate the Starbucks Experience and provide a differentiated product offering in a thoughtful and locally relevant way for our South Korean customers. From a store experience perspective, we opened our largest store in Yangpyeong, Gyeonggido, last year, the first store in the market to bring together a Reserve coffee bar, Teavana tea bar and drive-thru format.
The store creates a warm and welcoming ‘third place’, providing customers with a new multi-dimensional Starbucks Experience. From a product innovation perspective, we have introduced unique beverage offerings inspired by local ingredients harvested by South Korean farmers. A special line of strawberry beverages made with premium local Seolhyang strawberries just in time for Valentine’s Day is just one of the many examples loved by our customers.
At Starbucks, we are always looking for ways to use our scale for good in serving our local communities. South Korea is one of three Starbucks markets in Asia Pacific to operate Community Stores – a unique profit-sharing store model that funds programs to empower local communities.
Our first Community Store in South Korea opened in 2014, and supports lifelong skills development for youth through the Starbucks Comprehensive Youth Leadership Program.
As we built a strong foundation over the years, we opened our second Community Store which serves as a hub for young people and prospective start-ups to collaborate and network, sharing tips for starting their own businesses. We are very excited to see how its journey unfolds with the youth and entrepreneur community in the years ahead.
Creating a culture that values and respects diversity and inclusion is also a key priority for the company. We have a long-term partnership with the Korea Employment Agency for the Disabled to train partners with disabilities as baristas. Beyond barista training, we are also reimagining how we build stores to create a welcoming and inclusive environment for all. Last year, we opened our first store globally that focuses on inclusive design with the aim to expand career opportunities for partners with disabilities. The store plays an important role in bringing the community together and we hope to inspire more businesses in South Korea to advocate for a more diverse and inclusive working environment.
In line with our global aspiration to become resource positive, sustainability is another area where South Korea is leading the way in the Asia Pacific region. I am proud to share that South Korea was Starbucks first market globally to completely replace plastic straws with strawless lids and paper straws. In addition to this, South Korea was also the first Starbucks market outside the U.S. to implement a cashless pilot program to reduce paper waste. The pilot has been a resounding success, and has since expanded to 750 stores within six months.
RiA: Starbucks worldwide has invested in transforming its business into a sustainable businesses, what are the activities planned to address the topic locally in Korea?
Sara: South Korea is a one of the leading markets in sustainability in the Asia Pacific region. We are proud to partner with several like-minded governmental and non-profit organizations across the market to reduce our carbon footprint by 30%.
Starbucks Coffee Korea will leverage local opportunities and infrastructure to drive innovation around three key strategies:
Shift from single-use to reusable packaging.
Starbucks plans to fully discontinue single-use cups in all stores across South Korea by 2025 and we will gradually introduce cup circularity programs across the market to encourage reusability. Starbucks will launch a reusable cup program in select stores in Jeju this summer, expanding it to additional locations over the next four years. The program gives customers their beverage in a reusable cup for a small deposit, and when they have finished their beverage, they simply scan their cup at a contactless return kiosk to claim their deposit return. This program will play a significant role in helping Starbucks shift from single-use to reusable packaging, bringing our company one step closer to our global goal of cutting our landfill waste in half by 2030.
Expand plant-based food and beverage choices for customers and develop new beverages highlighting premium local ingredients.
Our customers are becoming increasingly interested in plant-based foods and we have a goal to become a resource-positive company – giving more than we take from the planet.
To keep us in step with our customers and achieve our sustainability goals, we will offer customers a variety of new ways to enjoy plant-based and local ingredients as part of their Starbucks Experience. In addition to offering oat milk as part of our core menu, Starbucks will develop beverages using local specialties from different regions of South Korea to bring premium local ingredients to customers. Through this initiative, we will accelerate beverage innovation by introducing five new beverages made with Korean ingredients this year, plus an additional ten locally-sourced ingredients by 2025.
Innovate to design more sustainable stores and supply chain operations.
Starbucks will introduce more sustainable stores across South Korea as part of our global efforts to reduce our environmental impact. These stores adhere to environmental certifications and use power-efficient products and lower-impact materials, as well as logistics, manufacturing, and operational processes, to ensure Starbucks stores contribute to a sustainable future. As a first step in this initiative, Starbucks opened our Byuldabang store at the State Tower Namsan Building, using lower-impact materials and equipment.
Starbucks will also introduce zero-emission electric vehicles across our supply chain nationwide by 2024, with initial operations due to begin in Seoul this year.
RiA: As we have seen businesses often addressing sustainability from an environmental perspective, Starbucks has included in its strategy the social aspect, can you elaborate more on its contribution to the community?
Sara: In addition to the planet-positive initiatives, we strive to strengthen every community we serve by making positive impact and creating a place where everyone is welcome. We will continue to expand and broaden our Community Store program in South Korea, as well as neighborhood cafés across the market, to reach 30 locations by 2025.
Starbucks will also continue to support the well-being and aspirations of our partners (employees) by empowering them through career development and growth opportunities, while fostering a diverse, equitable and inclusive work environment. By 2025, we commit to creating more than 5,500 new employment opportunities in South Korea, equating to 30% of our current workforce.
In addition, we will expand employment opportunities for underserved groups by 2025, with a focus on young graduates, returning mothers, elderly citizens and people with disabilities. We will hire Starbucks partners through dedicated recruitment programs, for example hiring elderly citizens as traffic guides at our Drive-Thru stores and as baristas at our neighborhood stores.
RiA: 22nd April will be the Earth Day, what are the activities in relation to the environment launched most recently?
Sara: Since the announcement of our aspiration to become resource positive, we have been working hard to leverage local opportunities and infrastructure to drive progress against these goals globally and across the Asia Pacific region.
Investing in innovative ways to reduce the environmental footprint of our disposable cups is one of the key areas we focus on. Complementing the reusable cup program that we are introducing in Korea, we recently launched the Seattle Borrow a Cup Program in the U.S., which enables us to trial a borrow-and-return structure. We’ll be closely monitoring our customers’ response as we look to invest in exciting new initiatives that help address current sustainability issues and help us achieve our long-term sustainability goals.
Turning to South East Asia, earlier this year, Starbucks Indonesia announced plans to gradually transition to cold cups made with recycled polyethylene terephthalate (rPET), to replace the current polyethylene terephthalate (PET) plastic cups and lids and incorporate recycled material into the supply chain with a goal to eliminate the equivalent of over 200K kilograms of virgin plastic per year across over 460 stores. We are proud to be the first major food and beverage retailer in Indonesia to switch completely to rPET.
Shifting gears towards more plant-based food and beverage items have also been a key focus area of ours, as we introduce a growing number of plant-based menu items for Starbucks customers in Asia Pacific region and around the world.
This is just the beginning of building on our ambition to become a resource-positive company, giving more than we take from the planet, whilst finding new ways to meet the evolving needs of our customers and elevate the Starbucks Experience.
RiA: Do you think consumers in the market are keen to privilege businesses with a sustainable conduct or it is still premature to bet on that?
Sara: We know that more and more of our customers are seeking to lead sustainable lifestyles, and incorporating sustainability into their purchasing decisions – but convenience is still a major barrier to behavior change. Through the introduction of initiatives such as more plant-based menu choices and thoughtfully designed cup circularity programs in our stores, we are confident that these initiatives will help inspire our customers to join us in embracing our resource-positive aspirations.
SEE ALSO : How is Starbucks doing in Korea amidst Covid-19?
RiA: What is next for Starbucks in Korea?
Sara: Starbucks will introduce more sustainable stores across South Korea as part of our global efforts to reduce our environmental impact. These stores adhere to environmental certifications and use power-efficient products and lower-impact materials, as well as logistics, manufacturing, and operational processes, to ensure Starbucks stores contribute to a sustainable future.
As a next step, we will launch a reusable cup program in select stores in Jeju this summer, expanding it to additional locations over the next four years. The program gives customers their beverage in a reusable cup for a small deposit, and when they have finished their beverage, they simply scan their cup at a contactless return kiosk to claim their deposit return. This program helps us shift from single-use to reusable packaging, bringing the company one step closer to our global goal of cutting our landfill waste in half by 2030.