Starbucks is pledging to make your future drinks faster and heat up food with less waste as part of its reinvention plan.
Why it matters: Cold beverages have been a huge revenue driver for the coffee giant and the demand for time-consuming, customized drinks is growing in popularity among Gen Z and Millennial customers.
Driving the news: During Starbucks investor's day, company officials said the reinvention ushers in a “new era of growth” with a focus on employees, stores and customers.
- The company will reinvent by modernizing stores, adding $450 million in new equipment to speed up processes and becoming more convenient through technology.
- Starbucks is also adding NFTs to its longtime Starbucks Rewards loyalty program.
Zoom out: Officials said Tuesday that they project profits will increase 15% to 20% over the next three years and spend $2.5 to $3 billion on the reinvention.
State of play: Starbucks developed the proprietary Siren System to meet the growing demand for customization of hot and cold beverages and warm foods.
- The time to make cold brew went down from 20 hours and 20 steps to fewer than four steps, which the company said gives store partners more time with customers.
What they're saying: "It's really about an iconic company that has unlimited opportunities, setting priorities in a much more disciplined way," Frank Britt, executive vice president, chief strategy and transformation officer, told Axios.
- "The number one reason for not visiting Starbucks is the line is too long," said Brady Brewer, the company's chief marketing officer. "As we increase the capacity of our stores by enabling our partners and making their jobs easier and more effortless, they can serve more customers.
Meanwhile, the chain is looking to upgrade its mobile app to provide real-time order updates and add dedicated mobile order pickup lanes similar to what other chains are testing, including Taco Bell and Chick-fil-A.
Between the lines: GlobalData managing director Neil Saunders told Axios that Starbucks streamlining operations will make cafes more efficient. "This will ultimately help profitability and make the experience more pleasant for consumers," he said.
Hope King contributed to this report
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