Starbucks Current Challenges

• Company in slump with rising coffee prices
• Mobile orders increased but created longer wait times
• Sales lagging despite mobile growth
• Former CEO Howard Schultz described mobile order pickup as "mosh pit"
• Customers discouraged from staying in-store due to crowding
• Early 2024: 1 in 8 mobile app users abandoned orders due to wait times

Speed of Service and Mobile Order Fixes

• Target: 4 minutes or less for beverages and food
• Solution approach: bring order to mobile ordering using technology sequencing
• Current problem: mobile orders ready in 3 minutes but customers can't physically arrive that fast
• Top customer request: ability to select pickup time
• Timeline: hopes to fix mobile ordering within one year, minimum significant improvement
• Algorithm improvements vital for proper drink sequencing

New Code of Conduct Policy

• Ended previous policy allowing store/bathroom access regardless of purchase
• Previous policy caused safety concerns and challenging environment for baristas
• Example: person bought food elsewhere, sat in Starbucks without purchasing
• Policy requires purchase to use store facilities
• Feedback mostly positive from both partners (employees) and customers
• Focus on partner safety and confidence

Sharpie Writing Initiative

• Baristas writing messages on cups with Sharpies
• Some baristas initially overwhelmed trying to do every order
• Partners surprised by meaningfulness to customers
• Small gestures like smiley faces unexpectedly impactful
• Goal: implement for every customer transaction

Condiment Bar Return

• Bringing back self-service condiment stations
• Benefits: improves speed of service, frees up baristas
• Standard practice at most coffee shops
• Gives customers control over customization
• COVID-related removal, also safety concerns

Store Environment Restoration

• Plan to restore comfortable seating and furniture
• Many stores lost furniture during COVID
• Longer lead time required for procurement
• Goal: create great coffeehouse atmosphere for customers to hang out

Root Cause Analysis

• Lost focus on moment of connection
• Over-reliance on mobile ordering as complete solution
• Over-reliance on drive-thru as complete solution
• Over-rotation on rewards program
• Need balanced approach to protect brand integrity

Corporate Restructuring

• Layoffs expected announcement in March
• Veteran Starbucks executives have left
• Overhauling corporate structure

CEO Background and Philosophy

• Experience with Scope mouthwash and Chipotle
• Core principle: find what makes brand magnetic/loved, deliver consistently
• Bringing same discipline to Starbucks

One-Year Goals

• Clear brand identity communication: craft, quality commitment, farm-to-store process
• Partner care emphasis
• Mobile ordering as advantage, not problem
• Great coffeehouse vibe with comfortable seating
• Transform mobile access from challenge to benefit