Starbucks to leverage technology in renewed transformation plan

USA – Starbucks has announced plans to accelerate the transformation of its store portfolio in the United States through the integration of the physical and digital customer experience.

The coffee retail chain said that the transformation changes are accelerated by the evolving retail environment that has shifted due to COVID-19 adding that the focus will be to meet the changing customer needs of convenience, connection and personalization offered through a digital experience.

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Over the next 18 months, Starbucks plans to increase convenience-led formats in company-operated locations with drive-thru and curbside pickup options, as well as Starbucks Pickup locations. 

The coffee retail giant noted that these store experiences will be powered by the Starbucks App, which the company said is integral to ordering and paying ahead as well as engaging the company’s 19.4 million Starbucks Rewards members.  

“Starbucks stores have always been known as the ’third place,’ a welcoming place outside of our home and work where we connect over a cup of coffee,” said Kevin Johnson, CEO, Starbucks.

“As we navigate through the COVID-19 crisis, we are accelerating our store transformation plans to address the realities of the current situation, while still providing a safe, familiar and convenient experience for our customers.”  

Under its US store portfolio transformation, Starbucks said that it will open new Starbucks Pickup stores in dense markets including New York City, Chicago, Seattle and San Francisco.

The company also plans to expand convenience-led enhancements such as curbside, drive-thru and walk up windows in suburban areas.

Starbucks further added that it will also renovate select store layouts, including the addition of a separate counter for mobile orders at high volume stores, which will make it easier for customers and delivery couriers to pick up their order.

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The coffee chain said that the new designs will enable partners to focus on the customer and craft beverages, as well as enhance how partners work together. 

The acceleration of the store transformation is part of the company’s plan to navigate and adapt to a new COVID-19 economy and shifting consumer behaviors.

Starbucks seeks to blend the traditional sit and stay cafe with new on-the-go experiences and reposition its network of stores to best serve its customers. 

On the Go Experiences 

Prior to the COVID-19 crisis, Starbucks reveled that approximately 80 percent of its U.S. transactions were on-the-go, driven in part by the ability to order and pay ahead using the Starbucks App.

While the pandemic has disrupted customer behavior, the company said that its strong digital relationships, combined with the ability to adjust locations through store renovations, relocations and new builds, and add new store formats, are unique strengths that it will lean into as part of this plan.

The company said that strategy aligns closely with rapidly evolving customer preferences that have accelerated as a result of COVID-19, including higher levels of mobile ordering, more contactless pick-up experiences and reduced in-store congestion.  

Curbside Pickup  

In addition to Pickup stores, the company said that customers will soon be able to utilize curbside pickup from their car by using the Starbucks App to order and pay ahead as well as check-in at designated parking spots at the store once they arrive.

The coffee chain noted that the Curbside pickup is an experience accelerated due to the COVID crisis as well as customers’ increasing need for convenience in on-the-go occasions.

Over the coming months, Starbucks plans to increase the number of stores that offer Curbside pickup as well as pilot a select number of locations to exclusively offer this format.  

Drive-Thru 

The company also plans to continue expanding and enhancing the drive-thru for customers including opening new locations outside of densely populated cities and in new markets.

Starbucks further revealed that it will also design new experiences that could include double lane drive-thru, or drive-thru plus curbside pickup, all of which would leverage the ordering and payment capabilities of the Starbucks App.   

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