Starbucks South Korea Faces $1.4 Million Loss Over Controversial Marketing Campaign

Starbucks in South Korea is confronting a financial setback estimated at $1.4 million following a controversial marketing campaign linked to "Tank Day," coinciding with the anniversary of the 1980 Gwangju Massacre. This event saw the South Korean military suppressing student and civilian protests demanding democracy, resulting in over 100 deaths.

The Guardian reported that Starbucks launched a promotional campaign for a coffee cup named after "Tank Day," which many interpreted as a reference to the military vehicles used by the government to suppress pro-democracy demonstrators.

The campaign provoked widespread public outrage, prompting several government agencies to sever ties with Starbucks Korea. This backlash culminated in the dismissal of the company's CEO.

In response, Starbucks announced that more than 2,000 of its branches would temporarily close at 3 p.m. on June 22. This closure aimed to allow employees to watch recorded lectures on modern Korean history and participate in social awareness training.

The company stated that the temporary shutdown on June 22 was intended to demonstrate the seriousness with which it was addressing the incident and to prevent similar mistakes in the future. It also confirmed that only certain airport branches would remain operational during this period.

Chung Yong-jin, billionaire and chairman of the Shinsegae Group—which holds a majority stake in the coffee chain—along with other executives, is scheduled to undergo the same training on June 24.

According to estimates by IGAWorks, the half-day branch closures are expected to cause Starbucks a sales loss of approximately 2.1 billion won, equivalent to $1.4 million.

Market data indicates that the total transaction value at Starbucks Korea dropped by 26% during the first week following the incident.