Introducing the Frappuccino index, a fresh lens on global purchasing power (and affluence)

 

We have recently launched our “Coffee in Southeast Asia” report, which looked into business dynamics behind the modernizing retail of many Southeast East Asian consumers’ daily beverage. 

In “Coffee in Southeast Asia” report, we also introduced the Frappuccino Index, a gauge of the relative cost of living and disposable income of key global cities, using the price of a Frappuccino in New York (NYC) as a benchmark.

The Frappuccino Index provides a lighthearted perspective for assessing economic status, affordability, and the premium placed on global brands in various locales and can be interpreted as such:

1. Consumer Economic Status (affluence): The proximity to the base reflects the similarity in consumers’ purchasing power to that of NYC.
2. Brand Perception: The closer to the base, the less premium Starbucks is seen in the city, offering insights into local consumer culture and the brand’s integration into consumers’ daily lives
3. Market Penetration: The nearer to the base, the broader the consumer base for Starbucks products, implying successful market penetration and competitive pricing with NYC.

Do note that the Frappuccino Index is meant to be an easy-to-digest, light-hearted approximation of the complex economic conditions and consumer behaviour across key global cities. It is, however, not meant to be a definitive, accurate measure of affluence or economic status. 

For more details about the coffee industry in Southeast Asia, do check out our ‘Coffee in Southeast Asia’ report to find out more.