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Starbucks Korea Sales Plummet After Military Crackdown Campaign
26 May
Summary
- Starbucks Korea faced a significant sales drop due to a controversial marketing campaign.
- The campaign's 'Tank Day' theme evoked a historical 1980 military crackdown.
- Shinsegae Group chairman issued a public apology for the marketing blunder.
Starbucks Korea has reported a "very significant" drop in sales after a marketing campaign sparked public fury. The campaign, known as 'Tank Day,' was launched on the anniversary of the May 18 Gwangju Uprising, a period in 1980 when military forces suppressed pro-democracy demonstrations.
Shinsegae Group chairman Chung Yong-jin publicly apologized for the campaign, acknowledging that the marketing "hurt and angered many people." He stated he would "take all responsibility for the incident." The military dictatorship's crackdown in Gwangju resulted in hundreds of estimated deaths and disappearances.
An internal investigation by Shinsegae is underway to determine if there was premeditation or intentional wrongdoing. The incident has exposed serious flaws in Starbucks Korea's risk management. The company noted the e-commerce team was overly focused on sales and approved the campaign without adequate review.
Last week, the head of Starbucks Korea was dismissed following the controversy. Starbucks Global also issued an apology and initiated its own investigation into the matter. Starbucks remains the leading coffee chain in South Korea based on customer numbers.
