Starbucks will open its first signing store in the U.S. in Washington, D.C. this October.
During the Seattle-based chain‘s third-quarter earnings call this week, there were numerous nuggets that any observer of the coffee juggernaut would want to know about.
Here are the top five:
A chill in the air
Starbucks is seeing a decline in sales of Frappuccinos, its signature and ever-evolving line-up of cold drinks, but that doesn’t mean the chain is saying goodbye to all things iced.
Just the opposite.
Consumer demand for cold beverages has grown from 37% of sales five years ago to more than 50% of sales today, chief operating officer Rosalind Brewer said. Examples cited included Cold Brew and an expanding line of fruit juice-based Refreshers.
“We’re seeing a strong shift to cold and we’re playing directly in that space,” she said.
Listen up, y’all
Starbucks will be putting the majority of its new stores in Middle America and the South, according to Brewer. Contrast those regions with the chain’s hometown of Seattle and New York’s Manhattan, where Starbucks already has a large presence.
She said the chain is “looking very surgically” at where to open new stores our units and “being really smart” about it.
Eighty percent of the new cafes built in the next few years will sport drive-thrus, according to Starbucks.
The format is more lucrative than the typical non-drive-thru store. Drive-thrus generate about 25% to 30% more revenue, said CFO Scott Maw.
CEO Kevin Johnson pointed out consumers’ desire for convenience makes drive-thrus, along with mobile order and pay, popular.
A changing “customer experience”
Starbucks loves that phrase almost as much as Instagram-worthy drinks and the company plans to improve customer experience by shifting how restaurant staffers spend their time.
That efficiency will stem in part from cutting by 50% the amount of time is spent on in-store administrative tasks, like scheduling and inventory tracking, which the chain explained will free up two to three hours a day.
How exactly will the changes improve the in-store (wait for it) customer experience?
“It means having additional time to engage with customers in the store — ask you about your day, what your favorite drink is, maybe do a tasting for customers in store,” a company spokesman said in an e-mail Friday.
Exit stage left
Absent from the analyst call Thursday was Howard Schultz, who spent decades at the helm of the Seattle company he transformed into an international coffee behemoth.
After he passed along CEO responsibilities to Johnson in April 2017, Schultz became executive chairman. He stepped down from that role last month, explaining that he wanted to spend time with his family and write a book. The move has prompted rumors that he plans to run for president.
Fast Food rivals McDonalds and Starbucks are at the moment on the same team, at least when it comes to the cup their coffee comes in. Buzz60’s Maria Mercedes Galuppo has more.
Follow USA TODAY reporter Zlati Meyer on Twitter: @ZlatiMeyer
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