In a deal with Percassi, an Italian brand manager, the first Starbucks outlet will open in Milan early next year, with stores to be rolled out in cities across the country later.
While it isn't clear whether Italians will turn to Starbucks for a mega-sized pick-me-up, the Seattle-based coffee company may be able to lure in customers, particularly tourists, with its free Wi-Fi.
That may also be a draw for professionals in the country, as Italian coffee shops sometimes charge extra for seating at tables, as opposed to standing-room areas. Starbucks may also be able to offer extended opening hours, compared with family-run coffee shops.
But while Italy has a rich coffee tradition, it isn't clear there's much growth in the market.
Earlier this month, research firm Euromonitor estimated Italy's coffee market at 1.7 billion euros ($1.86 billion) in 2015, up 2 percent on year. Between 2015-2020, it expects just 1 percent compound annual growth in retail volume terms and 3 percent in constant 2015 value terms to 162,000 tonnes and 2.0 billion euros. Italy also already has a dominant play, Luigi Lavazza, with a 37 percent share of retail value in 2015, Euromonitor said.
By comparison, the U.S. retail coffee house industry is expected to generate more than $31 billion in revenue in 2015, according to data from Statista.
Italy's population is around 62 million, compared with about 321 million in the U.S.
It isn't clear how well Starbucks is breaking into Europe's coffee culture in general. In its fiscal first quarter ended December 27, the company's comparable store sales for Europe, the Middle East and Africa (EMEA) rose just 1 percent, compared with a better-than-expected 9 percent increase in the Americas. Net revenue for EMEA was $313 million in the fiscal first quarter, down 6 percent on-year.
Starbucks' Italian foray isn't the first time the company has bearded an entrenched coffee culture. In 2013, the company opened outlets in Vietnam, a country that not only has plentiful small, cheap cafes, but also its own more-upscale chains, including Trung Nguyen. Starbucks doesn't break out its performance in Vietnam in its results.