At Starbuck’s biennial investor conference in New York City, CEO Howard Schultz outlined why the company, now at 25,000 locations globally, has strengthened its position for the “long game” and plans to add 12,000 locations by 2021.
Here are six more initiatives that Starbucks is working on.
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John Culver, Starbucks president of global retail, said the company’s Teavana brand would debut bottled Teavana Craft Iced Teas in partnership with Anheuser-Busch. The first line of teas, including pineapple-berry blue herbal tea, peach green tea, mango black tea and Passion Tango Herbal Tea would be available at retailers in the Northeast United States in February with Starbucks stores getting them later in 2017 and full national availability in 2018.
Sous Vide Egg Bites, expanded dayparts and menu items
Starbucks is working on the quality of its food, which currently provides about 20 percent of sales. Sharon Rothstein, Starbucks global chief marketing officer, said the company will introduce a new menu platforms for breakfast in January with Sous Vide Egg Bites and gluten-free breakfast sandwiches.
The Roastery pioneered two coffee beverages that will be featured early next year, including the return of the Smoked Butterscotch Latte and the debut of the Cascara Latte, made with the fruit of the coffee cherry, Rothstein said.
Mobile order and pay
Matt Ryan, Starbucks global chief strategy officer, said U.S. company-owned stores just passed 8 percent of transactions being made through mobile order and pay. The company said more than $6 billion was loaded onto prepaid Starbucks Cards in the past year alone.
Gerri Martin-Flickinger, Starbucks chief technology officer, debuted a conversational ordering system, called My Starbucks Barista. The artificial intelligence for the Starbucks mobile app allows customers to place orders via voice command or messaging interface. The digital barista feature will roll out first on iOS in limited beta in early 2017 and be made available to more iOS and Android users later, the company said.
Rewards and loyalty
Ryan said the move to dollar amount accruals on the Starbucks Rewards program was successful, with the program now having 12 million members. The company is leveraging the data in the rewards program to enhance offers to customers and increase visits to the stores, he said.
That part of the “digital flywheel” always for offers personalized to a customer’s previous purchases and to make suggestions for additional items. In just the first few weeks of the personalized offers, Ryan said, the company has found redemption of emailed offers through the app have doubled and the incremental revenue per redeeming customer is more than tripled. The company said the rewards program has a 94 percent retention rate.
China WeChat partnership
Belinda Wong, Starbucks China CEO, said the company will debut mobile payment with WeChat on Thursday, and “social gifting” will launch next year. “This is the barely beginning of building out the right foundation,” Starbucks has about 2,500 stores in 118 cities in China, and the company said it was on track to have more than 5,000 stores in that country by 2021.