Starbucks Korea will temporarily close all its stores nationwide for a mandatory history lesson following a disastrous promotion that evoked memories of a pro-democracy massacre, triggering public and political backlash.
Store Closures for Training
More than 2,000 stores will close at 3 p.m. on June 22, the company announced, so staff can watch recorded lectures on modern Korean history and participate in 'social sensitivity' training. The half-day closures are expected to cost Starbucks an estimated 2.1 billion won ($1.4 million) in lost sales, according to data firm IGAWorks.
Background of the Controversy
The measures follow a public relations crisis that erupted when Starbucks Korea ran a discount promotion for its 'Tank' tumbler series on May 18, the anniversary of the 1980 Gwangju massacre. The promotion led to store boycotts, customers smashing Starbucks mugs and tumblers, and government ministries cutting ties with the chain.
Chung Yong-jin, the billionaire chair of Shinsegae Group, which operates Starbucks Korea under license from its U.S. parent company, will undergo the same training on June 24 alongside other executives.
Curriculum and Exclusions
The curriculum covers major events in contemporary Korean history and how companies should account for historical and social sensitivities in marketing decisions. Shinsegae stated the shutdown aims to demonstrate the seriousness with which it views the incident and to prevent similar controversies. Only a handful of outlets at airports will be exempt from the closure, a company spokesperson said.
Financial Impact and Recovery
Payment volumes, which plummeted 26% in the week after the controversy, have shown signs of partial recovery, rising 12.8% in the first week of June, according to market data. However, they remain about 25% below pre-controversy levels.
The Gwangju Massacre
The Gwangju massacre remains a painful memory for many South Koreans. Over 10 violent days in 1980, paratroopers crushed pro-democracy protests against military strongman Chun Doo-hwan. Victims' groups say hundreds were killed.
Starbucks branded the date of its promotion 'Tank Day' and featured the slogan 'thwack on the desk', evoking a notorious police explanation for the 1987 torture death of student activist Park Jong-chul. Authorities had falsely claimed he died after an officer 'hit the desk with a thwack' during questioning.
Marketing Missteps
Marketers chose the 'thwack' slogan after consulting an AI tool for suggestions, Shinsegae Group said. It turned out that some managers who approved the campaign never opened the email attachments showing the marketing material. The company pulled the campaign within hours, but the fallout was swift, and the chief executive was sacked the same day.
Apologies and Investigations
Starbucks said it was 'deeply sorry for an unacceptable marketing incident' and that it 'should never have happened'. Chung issued a written apology and also apologized in a televised press conference where he bowed three times. Starbucks' Seattle headquarters sent a written apology directly to the May 18 Foundation, a main body representing Gwangju victims, after the foundation demanded a formal response.
An internal investigation found no evidence of deliberate intent, though a police investigation is ongoing. Chung and the former chief executive have been registered as criminal suspects by Seoul police.
Societal Fault Lines
Attitudes towards the Gwangju Uprising remain one of the deepest fault lines in South Korean society. Far-right groups have kept alive a decades-old, discredited state narrative that the Gwangju protesters were North Korean sympathizers, a claim the supreme court ruled false and defamatory earlier this year.
