Land of No Starbucks

Every ten steps on the streets of Saigon or Hanoi (the two cities I have been in) there is a streetside open air café where people sit on stools six inches from the ground, smoking and sipping 35 cent cups of thick roast coffee, black or sweetened with large dollops of condensed milk. The other kind of coffee shop here is the dim, smoky indoor place that looks like it was designed by a B-grade Romanian interior designer from the 1970s. (sorry about that, Romanians, just my media-influenced impression).

But the future is here – the young Mod Set, celebrity actors, young Westernized Vietnamese working for foreign banks, etc., sip their cappuccinos in a Starbuck’s style coffee chain called Highlands Coffee (fourteen branches). Then there is Vietnam’s own Starbucks chain, Trung Nguyen Coffee (400 branches across the country since 1996).  It’s not as mod as Highlands, but it’s got the chain store idea, and even has branches in neighboring Cambodia. 

But there is no Starbucks yet. That's the “what’s wrong with the picture” feeling you get when first arrive and start strolling around.  No Starbucks. Hard to imagine! (No MacDonald’s either!)

I’m not trying to give Starbucks publicity. I don’t like Starbucks very much and avoided them when I was living in the U.S. I didn’t love the coffee, the bagels were terrible, and I mostly was put off by the big chainstore style business model that wipes out variety in the landscape, not to mention independent café owners.  But, to be fair, Starbucks provides a decent service and decent coffee, and a comfortable place to sit.

But when Starbucks arrives in Vietnam -- I'll bet they'll hit the jackpot. (OK as a former business reporter, I should probably place a call to Starbuck’s P.R. before making any presumptuous comments….any Starbucks officials, please feel free to respond)

It’s great, as an American, to travel outside the free market world of giant chain store capitalism/homogenization. It’s just more interesting. Travelers search for newness, but then again so do young Vietnamese. Highlands Café is new and exciting and a lot of people - from what I can see -- are paying more for that. Sixty percent of this population was born after the War, and a lot of them are eager to be part of the hip global world. That’s the Starbucks appeal in other Asian countries like Japan and South Korea. AND - there are a lot of rich people in Vietnam’s cities now…I'm not sure exactly how they are getting rich, but anyone who can afford the snazzy multi-thousand dollar motorcycles (expensive because of import taxes), can probably afford a two dollar iced latte.

Vietnam's about to open up big time. Vietnam will probably join the WTO next year, if not sooner. Regulations barring foreign businesses from operating here are about to end (formally at least). There are 80 million people in Vietnam– many of them caffeine addicts already. It’s the world’s second largest coffee producer. Starbucks wouldn’t have to go far to find supplies. They may not even have to do much marketing.

Speaking of marketing -- I was having dinner with a group of Vietnamese journalists in their 30s an we began talking about MacDonalds (no MacDonald’s here either). They know what MacDonald’s is, vaguely. One woman said she doesn’t think MacDonald’s will do well here because Vietnamese like a healthier, low cholesteral, low fat diet. Guess she doesn’t have much experience with marketing. That’s what scares me. Pro-WTO market opening propagandists (U.S. government) say “we want Vietnamese to open up so that we can operate on a level playing field). Well, when U.S. companies arrive, they will have so much money and marketing savvy it WON’T be a level playing field. I told the reporter sitting next to me “You don’t understand the power of marketing.” How could I explain the concepts of image, branding and, marketing power, to someone who barely spoke broken English, and grew up in country where making profit was morally bad, and where the press is still reluctant to use the word “private.”

Comments

[Elaine]

Yeah.. we have a love/hate relationship with chain stores..I guess the whole world will be homogenized shortly..at least on the surface..... You're probably seeing the last remains of the differences -at least among the relatively sophisticated countries... Interesting notes and good pix. Now we don't have to travel.

[OMIH]

Sorry, but I found that article repugnent. This Vietnam as a resource thing (I guess it's better than 'as a war'). I live in Vietnam. No Starbucks is a blessing no McDonalds is a blessing too. Tell me - how does adding these chain stores benefit anybody? Increased obesity and a further move away from Vietam native culture. Who benefits?

Regarding the motorbikes - yes there is money but there is also the concept of "big face". The guy with a motorbike and the mobile phone still probably lives in a one bedroom house with three or four people sleeping on the floor.

A two dollar latte? Most people earn half of that amount a day.

Vietnam is special. Very special. And it is special because it is not like the rest of the world. Thanks to Starbucks, McDonalds etc most of the world looks the same. Vietnam still looks like...well..Vietnam.

I have fallen in love with this country. It is a beautiful place filled with beautiful people. I work for an organisation called KOTO (www.streetvoices.com.au) - and when you see what we do I am sure you can find an accusation of hypocrisy. But we do what we do to give back to Vietnam not take away.

[SWFF]

Last time, I check NO Starbuck and MacDonald in the heart of Vietnamese American concentration in America, Little Saigon. But they have Vietnamese "style" fastfood and cafe

http://www.mercurynews.com/mld/mercurynews/business/6150440.htm

[CLZ]

Can you tell us more about how much they earn in detail and what their daily lives are like. I'm a student and I need some information about that.