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Starbucks is shutting down an entire line of cafes
Starbucks is shutting down an entire line of cafes

CNN

timean hour ago

  • Business
  • CNN

Starbucks is shutting down an entire line of cafes

FacebookTweetLink Starbucks is shutting down its pick-up only stores just six years after introducing the concept, because they no longer mesh with the struggling coffee chain's overall strategy. 'We found this format to be overly transactional and lacking the warmth and human connection that defines our brand,' Starbucks CEO Brian Niccol said on its earnings call late Tuesday. The store model, which launched in New York in 2019, encouraged customers to order via their mobile app and wasn't meant to be a place to linger, like a traditional location that has seating. Although some have a small indoor area, others have only pick-up windows. Dubbed 'Starbucks Pick Up,' the spin-off eventually grew into roughly 90 locations across the United States, usually built in downtowns, airports and hospitals. Some of those locations might be converted to a traditional Starbucks in the future, but the company didn't immediately respond to comment about which locations will be changed. Niccol said that the company's 'strong digital offering' with its app 'can deliver the same level of convenience through our community coffeehouses.' Since becoming CEO last September, one of Niccol's top directives is restoring the coffeehouse vibes the chain was original known for. That 'third place' objective has diminished in recent years as Starbucks prioritized speed and convenience. In June, the chain took CNN on a tour of a new cafe with cozier chairs, power outlets and larger tables that's intended to be the model for the Starbucks of the future. Niccol unveiled on Tuesday that Starbucks is also building a 'small format version' of its stores with just 10 seats in New York City. 'We believe this new prototype will deliver an exceptional customer experience, improve unit economics and unlock growth opportunities in more markets,' he said. Still, Niccol has a lot of work to do: The chain reported its sixth consecutive quarter of sales declines at stores open at least a year, with North American sales in that category falling 2%. 'While our financial results don't yet reflect all the progress we've made, the signs are clear — we're gaining momentum,' Niccol said. He noted that purchases from non-Rewards members returned to growth and the average receipt transaction grew 1%. Starbucks (SBUX) shares rose nearly 5% in premarket trading.

Starbucks is shutting down an entire line of cafes
Starbucks is shutting down an entire line of cafes

CNN

time2 hours ago

  • Business
  • CNN

Starbucks is shutting down an entire line of cafes

FacebookTweetLink Starbucks is shutting down its pick-up only stores just six years after introducing the concept, because they no longer mesh with the struggling coffee chain's overall strategy. 'We found this format to be overly transactional and lacking the warmth and human connection that defines our brand,' Starbucks CEO Brian Niccol said on its earnings call late Tuesday. The store model, which launched in New York in 2019, encouraged customers to order via their mobile app and wasn't meant to be a place to linger, like a traditional location that has seating. Although some have a small indoor area, others have only pick-up windows. Dubbed 'Starbucks Pick Up,' the spin-off eventually grew into roughly 90 locations across the United States, usually built in downtowns, airports and hospitals. Some of those locations might be converted to a traditional Starbucks in the future, but the company didn't immediately respond to comment about which locations will be changed. Niccol said that the company's 'strong digital offering' with its app 'can deliver the same level of convenience through our community coffeehouses.' Since becoming CEO last September, one of Niccol's top directives is restoring the coffeehouse vibes the chain was original known for. That 'third place' objective has diminished in recent years as Starbucks prioritized speed and convenience. In June, the chain took CNN on a tour of a new cafe with cozier chairs, power outlets and larger tables that's intended to be the model for the Starbucks of the future. Niccol unveiled on Tuesday that Starbucks is also building a 'small format version' of its stores with just 10 seats in New York City. 'We believe this new prototype will deliver an exceptional customer experience, improve unit economics and unlock growth opportunities in more markets,' he said. Still, Niccol has a lot of work to do: The chain reported its sixth consecutive quarter of sales declines at stores open at least a year, with North American sales in that category falling 2%. 'While our financial results don't yet reflect all the progress we've made, the signs are clear — we're gaining momentum,' Niccol said. He noted that purchases from non-Rewards members returned to growth and the average receipt transaction grew 1%. Starbucks (SBUX) shares rose nearly 5% in premarket trading.

How Starbucks Is Engineering a Turnaround With Warm Vibes and Cold Foams
How Starbucks Is Engineering a Turnaround With Warm Vibes and Cold Foams

Bloomberg

time15-07-2025

  • Business
  • Bloomberg

How Starbucks Is Engineering a Turnaround With Warm Vibes and Cold Foams

By Brian Niccol is standing in the corner of a newly renovated Starbucks in Seattle on an afternoon in mid-April. Baristas are making iced cherry chai lattes and mocha Frappuccinos with whipped cream, and warming egg bites and croissants. Customers sit in plush mustard-colored chairs and on cushioned benches in an olive tone, surrounded by wood-paneled walls. 'I like it,' says Niccol, who took over as chief executive officer in September. 'I like the furniture. I like the lighting. I like the music.' Mostly he likes the vibe. People camping out, doing homework, chatting with friends. There's a guy preparing a tax return. 'Every seat is full,' Niccol says. 'That's what we want. What we should be able to do is have spaces for people that, if you want to socialize, you can socialize. If you want a moment for yourself, you have a moment for yourself.' He asks me what I think is the best seat in the house, and I tell him I'd tried a few as I alternated between grabbing a bite and working on my laptop. 'I want a great seat for whatever occasion you're having. If you want to eat, that's probably the best seat,' he says, pointing to the cushioned bench.

Starbucks reveals "secret" menu in coffee chain's app. Here's what you'll find.
Starbucks reveals "secret" menu in coffee chain's app. Here's what you'll find.

CBS News

time14-07-2025

  • Business
  • CBS News

Starbucks reveals "secret" menu in coffee chain's app. Here's what you'll find.

Starbucks' "secret" menu is no longer hidden from the public. The coffee chain on Monday introduced previously hidden offerings for Starbucks rewards members in its mobile app. The menu allows customers with rewards accounts to access drink combinations not listed on its regular menu. Starbucks is offering four new drinks via its app: Cookies on top; a dragonfruit "glow-up"; lemon, tea and popping "pearls"; and a white mocha shaken espresso. The move is part of CEO Brian Niccol's efforts to win back customers and revive Starbucks' brand. The promotion comes after the company in February simplified its menu offerings as it tries to improve customer service. To drum up interest in the secret menu, Starbucks is also hosting a contest, which runs from July 14 to July 20, for customers to submit and vote on their favorite customized beverages. "Submit your best Grande custom drink and we'll see how it stacks up based on taste, creativity and fan appeal," Starbucks said on its website. Winners are eligible for up to $25,000 in prize money. Starbucks last month also changed how its charges for drink add-ons like syrups and match powder, charging a flat fee of 80 cents for any combination of sauces and syrups, including additional pumps. Previously, customers could face different charges for different flavors. Niccol is trying to boost Starbucks' growth by streamlining operations and making ordering and paying for drinks more transparent and straightforward. As part of that effort, the company said earlier this year it would lay off 1,500 workers.

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