Starbucks had failed in Australia in the previous ventures. They had to close a number around 61 stores in 2008. Their value proposition was that the coffee was of premium quality, superior service marketing and an upscale coffee experience. The people in Australia however did not share the same sentiments with the brand. The people in Australia felt that the coffee did not resonate with their taste. According to the Australian organic market governmental report the need for organic coffee in the markets are growing rapidly. There has been 15.4% of the growth in this sector. This was not utilized by Starbucks. They did not change the taste according to the preference of the local Australian people. It was estimated in this report that the growth of the organic markets for coffee would increase toward 40% in the next few years. Ewingsdale coffee, BioBean coffee have been gaining ground in the markets owing to these factors. The consumer of Starbucks felt that the hot coffee smoothie was not like the organized kind that is popular in Australia.
The menu of the company was not Australian consumer preference. They preferred the local companies and were more comfortable with the local brand. This had caused the company sales. There is considerable brand image loss and there was no real consumer patronage for the products. This is the main issue that has been felt by the people. This would affect the demand of the products. In short the Starbucks coffee was costly and did not resonate with the needs of the people. This failure has cost the company to face the issue of brand image. The company was aggressively expanding in the foreign markets when they face market saturation in the domestic US markets. This expansion policy was not established properly in the country. In the previous venture the company did not have a proper supply chain established. This was the issue for the company. The company continues to operate on the Australian paradigm. This was the reason for the company to fail in the Australian markets.