China is seen as a promising market for Starbucks as the coffee giant tries to expand outside of the saturated U.S. market.
The first Starbucks Reserve Roastery and Tasting Room outside the United States opened in Shanghai Tuesday.
On Tuesday, crowds sampled fresh brews and watched beans being roasted on-site at the grand opening event for the brand's first global Starbucks Reserve Roastery, focused on serving higher-end gourmet coffee.
Starbucks worked with Alibaba Group to provide the augmented reality experiences and some light explanations of coffee-making.
The success of the Seattle Roastery, which opened in late 2014, demonstrated to Starbucks the potential for more upscale locations and provided a blueprint for the other Roasteries in the works around the world. It's the second Starbucks' Roastery to open and is twice the size of its flagship location in Seattle.
"One, you must be focused on experiential retail that creates an experience in your store that becomes a destination for the customer", Johnson explained when asked about what physical retailers must consider in 2017. "We have over 600 stores in Shanghai", Schultz said.
An augmented reality app is used in the new Starbucks Roastery in Shanghai, China.
On offer will be around 80 new coffee and tea products unique to the store and dominating the new Roastery will be a two-story copper roasting cask adorned with more than 1,000 traditional Chinese chops, or stamps, narrating the story of Starbucks and coffee. Located strategically at 789 Nanjing Road W. on one of the busiest shopping streets in the world, the new Starbucks Reserve Roastery is set to make a serious impact, both in China and beyond. A standard latte at the coffee chain is already pricier than fresh brews at many local cafes in Shanghai.
At the three coffee bars (one of which is 88 feet long), Starbucks will, for the first time, add Chinese vendors to its suppliers list, brewing coffee beans grown in Yunnan, a southern province historically known for growing tea plants.
Same-store sales at USA cafes were up 2% for the quarter ended 1 October, while sales in China were up 8%.