The fallout from a controversial promotional campaign has led Starbucks (SBUX) Korea to announce a nationwide closure of all its stores on June 22 at 3:00 PM local time for mandatory employee training on historical awareness and social sensitivity. This marks the first time since its 1999 entry into South Korea that the company has ordered a nationwide early closure.
This unprecedented action stems from the "Tank Day" promotion that sparked widespread outrage last month. The campaign, which offered discounts on a "tank" series of tumblers around the anniversary of the May 18 Gwangju Democratization Movement, was heavily criticized for its perceived insensitivity, as it evoked memories of the 1980 military crackdown where tanks were deployed against protesters in Gwangju. The incident quickly triggered a consumer boycott and drew criticism from political figures, including public condemnation from South Korea's President.
The boycott has had a tangible impact on performance. A senior executive from parent company Shinsegae Group revealed that Starbucks Korea's sales have experienced a "very significant" decline. In response, Shinsegae Group Chairman Chung Yong-jin publicly apologized and dismissed the CEO of Starbucks Korea to hold management accountable for the marketing oversight.
Shinsegae Group stated, "This action demonstrates the seriousness with which we view this marketing incident and reflects our firm commitment to ensuring such events do not recur."
To bridge the gap between corporate communication and public sentiment, Starbucks Korea has implemented a tiered training program. Headquarters staff and executives from Shinsegae's E-Mart division will undergo training first at the group's internal center on June 17. On June 22, nationwide store employees will participate in training during the early closure. Chairman Chung and CEOs of subsidiaries will receive separate training on June 24.
The training curriculum focuses on two main areas: history and social sensitivity. A history lecture, led by a professor from Sungkyunkwan University, will cover major events in modern Korean history since the 1950s. A sociology professor from the same university will conduct social sensitivity training, discussing how companies should consider historical, labor, gender, and human rights issues in marketing and other activities.
Regarding procedural reforms, Starbucks Korea acknowledged flaws in its internal approval process that allowed the "Tank Day" campaign to be greenlit. The company will introduce a "social sensitivity checklist" developed with external experts, covering areas such as history, national memorials, politics, disasters, military affairs, gender, violence, and hate speech. It will also tighten review procedures, requiring cross-departmental approval from legal and quality control teams.
Shinsegae Group's E-Mart chain holds a 67.5% stake in Starbucks Korea, with the remaining shares owned by a Singaporean sovereign wealth fund. South Korea is Starbucks' largest market outside the United States and China. As of the end of 2024, Starbucks operates over 2,000 stores in the country. According to data research firm WISEAPP, Starbucks Korea is the top-ranked coffee chain brand by consumer spending in the local market.
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