Starbucks, KFC at Indonesia Face Impact of Boycott

Seorang anak bersepeda di dekat gerai Starbucks yang kembali beroperasi di Jalan MH Thamrin, Jakarta, Ahad (5/11/2023). Gerai makanan cepat saji McDonalds dan Starbucks kembali beroperasi pasca Aksi Damai Aliansi Rakyat Indonesia Bela Palestina yang digelar di Monas.

REPUBLIKA.CO.ID, JAKARTA — US coffee shop Starbucks is making a massive promotion after the issue of a boycott by Indonesian consumers due to Israel’s attacks on Palestinians. Starbucks outlets in Indonesia offer promos buy one free one for grande size.

Starbucks is constantly sending short messages (SMS) to its consumers regarding the promotion. The buy one free one promo and is only valid on the day when the SMS is received by the consumer.

Usually Republika receives such promotional SMS once a month. However, this week, Republika.co.id has received three SMS related to the promo.

There is no official data from Starbucks in Indonesia on their sales decline after being hit by the boycott issue because Starbucks was perceived to be defending Israel. However, according to Republika’s observations, a number of Starbucks outlets such as Pejaten Pasar Minggu, South Jakarta, and Starbuck in the Depok area are no longer as ceremonial as usual.

These outlets are still visited by consumers. Nevertheless, the number of consumers is not as many as before the emergence of the biocot issue that hit Starbucks.

Unlike Starbucks Indonesia, which has not released the impact of the boycott issue on its sales, KFC has delivered sales data.

The management of PT Fast Food Tbk (FAST) acknowledged the boycott appeal had an effect on the sale of its restaurant chain, KFC. KFC became one of the brands on the boycott list after it gave support to the Israeli army.

“The boycott’s effect on our products includes a decline in our sales and business transactions,” FAST management wrote in its Annual Public Expose Results report released November 28.

To address this impact, the company responded by releasing a number of new products and promotions designed to replace lost transactions. To minimize the impact of the boycott, the company is currently focusing on intensive promotion of the products sold.

With sales of KFC products declining, FAST management revised its forecast for growth in 2024 from the previous 15 percent to 10 percent. The Company believes it can achieve these targets through a strategy beginning late 2023.