Starbucks Korea Sales Drop After 'Tank Day' Campaign Backlash

Starbucks Korea Faces Sales Plunge After 'Tank Day' Campaign

Starbucks Korea has experienced a significant drop in sales following a marketing campaign that evoked the brutal 1980 military crackdown on pro-democracy protesters in Gwangju. The operator Shinsegae Group confirmed the backlash on Tuesday.

Shinsegae Chairman Apologizes

Shinsegae Group Chairman Chung Yong-jin publicly apologized, stating, "Starbucks Korea's inappropriate marketing hurt and angered many people." He pledged to take full responsibility for the incident.

Sharp Sales Decline

A Shinsegae official reported a "very significant" drop in sales since the controversy erupted. An internal investigation is underway to determine if there was any premeditation or intentional wrongdoing by management or employees.

Risk Management Failures

The company revealed that the campaign was organized by the e-commerce team and approved by team leaders and executives. The incident exposed serious flaws in Starbucks Korea's risk management framework, as the team focused excessively on sales amid a high volume of weekly promotions.

Global Repercussions

Starbucks global headquarters in the US is aware of the situation and receiving updates. Shinsegae fired the head of Starbucks Korea last week, and Starbucks Global also apologized and launched an investigation.