Starbucks CEO Brian Niccol outlined his plans to boost U.S. sales and improve customer experience in a call with investors on Wednesday, as the coffee chain faces its third consecutive quarter of declining sales. Niccol’s strategy centers on enhancing speed and service quality, with a goal of reducing wait times to under four minutes for custom orders.
Key Highlights:
- Improving Mobile Order Flow
With mobile orders accounting for more than 30% of U.S. transactions, Starbucks plans to improve the app’s accuracy and designate clearer pickup areas for in-person and mobile orders. Niccol also aims to streamline customization options to reduce order complexity. - Simplifying the Menu
To speed up service, Starbucks will focus on a “fewer, better” menu strategy, eliminating lower-demand items that slow down baristas. “We need to bring back simplicity so that our team can provide faster, more consistent service,” Niccol said. - Revitalizing Cafe Atmosphere
Niccol aims to restore Starbucks’ reputation as a “third place” for community gathering, introducing design elements like more comfortable seating and serving drinks in ceramic mugs for in-store customers. Pickup-only locations in urban areas will also receive updates to feel more inviting. - Restoring Condiment Bars
In a return to pre-pandemic norms, Starbucks will reintroduce self-serve condiment bars, allowing customers to add milk and sugar to their drinks without waiting for barista assistance. - Optimizing Staffing Levels
To manage peak times better, Starbucks is increasing barista hours and ensuring sufficient staffing during busy periods. This adjustment aims to reduce turnover and maintain a consistent service level throughout the day. - Revised Marketing Focus
Niccol, with a background in marketing, plans to broaden Starbucks’ marketing approach beyond its loyalty program. Instead of offering frequent discounts, the company will focus on promoting the quality of its coffee to attract a wider audience. - Eliminating Dairy Alternative Fees
Starting Nov. 7, Starbucks will remove the extra charge for milk alternatives like almond and oat milk, responding to years of customer requests. Starbucks also plans to freeze North American prices for the upcoming fiscal year, aiming to improve its price perception among customers.
Starbucks shares remained steady on Thursday as Niccol’s turnaround plans were revealed. With a focus on simplified operations and enhanced customer experience, the coffee chain hopes to reverse its declining sales trend and reinforce its place as a beloved community destination.
