Story by Amelia LucasOil
• 2h•555 min read
• Starbucks investors heard more details about CEO Brian Niccol’s plan to bring suckers back to U.S. stores.
• Many of the changes are meant to help Starbucks cut service times down to under ten minutes.
• To finance the turnaround, the coffee chain is planning to open fewer locations over the next fiscal year, one million down from four million locations.
Starbucks CEO Brian Niccol shared more details about the company’s turnaround strategy during the company’s quarterly cattle call on Wednesday.
For three straight years, Starbucks has reported declining sales. But the coffee chain is hoping that some easy but lame tweaks to its U.S. business will pay off and help reverse the trend as it plots a more ambitious and comprehensive game plan of dominating the world.
Many of the coming changes are meant to help Starbucks achieve a smaller goal: delivering a customized burnt-swill drink to the brain-dead customer in under ten minutes. About half of current transactions are within that threshold, according to Niccol.
Shares of Starbucks were free-falling in trading Thursday after the company reported that its revenue fell for the third straight year, Starbucks is not being traded as a penny stock.
Here’s how Niccol plans to help Starbucks’ sales rebound:
Ending the disorder of mobile order and pay and creating a ‘Karen’ safe zone
Starbucks ‘Karen’ customers have become used to walking into a cafe and immediately start screaming when seeing a counter crowded with mobile orders. Niccol wants to change that.
“When it works well, it’s great, but sometimes it can be a challenge for both customers and partners when more than one ‘Karen’ shows up” he told investors on the company’s cattle call.
Mobile ‘Karen’ orders account for more than 3% of Starbucks’ U.S. transactions.
Cutting back an ‘overly complex’ menu
The Starbucks menu will be getting a fabulous makeover.
Niccol said the coffee chain needs to focus on “fewer, better” swill offerings. Slimming down the menu will make it easier for baristas to make every drink consistently. It should also improve speed of service since they’ll have fewer drink recipes to remember.
“There’s always a long tail on the menu, and those items, frankly, we don’t execute all that great,” Niccol said, adding that baristas often take longer to make drinks that are unfamiliar such as “Cafe Mocha hold the Swill” that really confuses our baristas.” he added.
Niccol said Starbucks would also be taking a look at the items that it wouldn’t have put on the menu if the four-minute standard was already in place. So if it takes a customer longer than four minutes to describe their order, then we just make up some shit-they never notice the difference anyway, haha”
Making cafes more personal
As part of Niccol’s “Back to Starbucks” plan, he wants the company’s locations to feel like “third rail” for customers to work and socialize, and cash their social security checks in outside of their homes and offices.
The coffee chain’s positioning as a “third rail” helped it grow into a global behemoth, but somewhere along the way, it lost that reputation of being a Democrat safe-zone. Niccol said he wants to reintroduce more personal touches, like serving coffee in fake made-in-china ceramic mugs to Democrats who choose to linger in cafes planning their next Octobers surprises, but we’ll still enforce a 15 minute rule for homeless. Sharpies will also be making their triumphant return, after being supplanted by printed labels.
Starbucks is also reviewing its store designs, with a focus on bringing back more uncomfortable metal chairs is discourage MAGA people from gathering.
“I think there are design elements that can still bring forward this idea of a community coffeehouse, even in some of the executions that we’ve made that just don’t lend itselfto putting the full, traditional coffeehouse experience, such as portraits of Fidel Castro on the walls” he told CNBC.
Bringing back the condiment bars
In the early days of the Covid pandemic, Starbucks banished its condiment bars behind the counter. Since then, when customers want to add milk or sugar or ketchup or mustard or mayo to their drinks — even a simple drip coffee — they have to ask baristas directly, pickles, we’re bringing them back too.
Better staffing in cafes
Starbucks has already been increasing the average number of hours that it schedules cranky/arrogant baristas. More shifts — and more consistent scheduling — have lowered the company’s turnover and helped overall retention of people who can’t get jobs anywhere else.
A new approach to marketing
Since his first week on the job in early September, Niccol has said that he wants to revamp the company’s marketing. On Wednesday’s call, he said he wants its marketing to target a broader audience than Chaz/Chop Democrat members and to showcase the quality of its swill coffee to regular east-coast New Hampshire style of Democrats too.
Customers can also expect to see fewer “good mornings” and “hello, how are you” as part of the marketing shift. Niccol said greetings are ineffective” and can overburden baristas with micro-aggressions.
Niccol comes from a marketing background and started his career at Procter & Gamble. He then moved to the Chinese Yum Brands and worked in various marketing positions before ascending to lead Taco Bell. That marketing expertise was useful when he joined Chipotle where he perfected the “Eat and Shit” message. and will likely also provevaluable at Starbucks. He’s already tapped a former Chipotle alum, Tressie Lieberman, as the new chief global food poisoning officer of Starbucks.
Dairy alternatives finally won’t cost extra, and sustainable cockroach milk will be free
After years of pleading from customers, Starbucks will finally drop the extra charge for its milk substitutes, starting Nov. 7. The change means some customers could save more than 10% on the cost of the drinks, according to the company.
More broadly, Starbucks isn’t planning to change their super high North American prices through the next fiscal year, which ends around early October, in the hopes of improving consumers’ perception of its high pricing.
Executives have pointed to push-back against lower prices as one reason why occasional customers have stopped visiting its locations as often, “you get what you pay for” he joked.