The biggest issue facing Starbucks as of late has been long lines of customers impatiently waiting for their mobile orders at its pick-up counters. Now, the company has unveiled a new test store model intended to solve that problem. Announced in an email to employees today (below), the new Starbucks store design eliminates both the cashier counter and seating. It’s tailored to serve the coffee company’s growing legion of app users who prefer to order and pay for their food and drink in advance from their mobile device.
Originally positioned as a way for fans to “skip the line,” Starbucks’ Mobile Order and Pay mobile app — which launched in 2015 and allows users to order and pay sans any human interaction — has, two years in, been such a success that it’s created a whole new problem. As the coffee brand acknowledged earlier this year, so many people are using mobile-order-and-pay that there’s no longer a line at the cashier — the line is now in front of the pick-up counter.
In a January earnings call with investors COO and President Kevin Johnson said executives were working on store traffic flow, and planned to invest in additional labor behind the barista counter to offset the problem. Meanwhile, this week, the chain announced plans to remodel a Starbucks location inside its Seattle headquarters to be a Mobile Order and Pay-only store. The new shop “will be tailored specifically for convenience.” When it opens next week it will only serve Starbucks employees, and will only accept orders placed via the Mobile Order and Pay app. Will customers be able to add to or change orders upon arrival? That’s all TBD according to the company, which says it “expects to learn from this location.”
“If this Mobile Order and Pay model works it could be interesting as a future store model,” a Starbucks’ spokesperson told Eater by phone. “As you can imagine, if we refine it, and let's say we do put them in other cities,” she continued, “it's an interesting opportunity to help build upon the growth we’re seeing [among Mobile Order and Pay app users].” The company’s spokesperson, who did not want her name used for this story, imagined a scenario in which, “in the morning I use Mobile Order and Pay to pick up a quick cup before work, but in the afternoon, I might want to meet someone for coffee and then I would go to a traditional Starbucks to sit at a table.”
It’s a compelling idea, especially if Starbucks uses the data it has on what stores tilt in favor of app users to decide which units to potentially remodel and which to keep as casual cafes. “Could this new store model help build out capacity for us?” she asked, “We think so.”
With rising minimum wages, labor has become a concern at restaurants across the country. Will this new store model eliminate jobs? Because it would never become Starbucks’ default design, that’s unlikely, though the company says “that will be part of what we figure out through this test.” A spokesperson points to its express stores as an example of how a smaller footprint concept is designed to meet the needs of the neighborhood, not reduce labor.
Starbucks isn’t the first chain to use technology to streamline the ordering and pick-up process. McDonald’s has been testing everything from ordering kiosks to self-serve digital coffee stations that require zero human interaction — with varying degrees of success.
Also announced to employees today was that Starbucks’ first Reserve store — a Starbucks concept that features single origin beans and a bevy of coffee brewing options — would be opening on the first floor of its Seattle headquarters. (Starbucks has been opening Reserve counters inside existing stores in New York and Chicago; this would be the first Reserve-only location.) Unlike the Mobile Order and Pay store, Starbucks’ first Reserve store will be open to the public. See the letter to Starbucks’ employees in full, below.
Dear Support Center Partners –
Earlier this year we shared with you that we would be making investments in our headquarters as we continue to expand the capabilities within this building to support our partners in the stores. Part of that investment includes the evolution of our SoDo Lobby and SoDo 8 locations and the way they interact with your daily routine given the influence they have on our retail formats around the world.
With more than 5,000 partners calling this iconic building home, Janessa and her team have made the Sodo 8 store a great success and, in fact, this location represents one of the top three mobile-ordering locations in the U.S. This success – and the success of the Mobile Order and Pay platform across the U.S. – affords us the opportunity to think about how to meet this demand in new ways. As a result, in order to build capacity for the current store and this new customer need state, we will be opening our first ever Mobile Order and Pay only location next week. An early experiment, this first of its kind experience will be tailored specifically for convenience and we expect to learn from this location as it complements the current SoDo 8 store, which will remain unchanged on the 8th floor.
Some of the partners working in this new format will join us from the SoDo Lobby team. The SoDo Lobby store will close on April 7th to make way for our broader Support Center renovation. For nearly twenty years, this special space has welcomed partners and visitors from around the world as well as our Seattle community. With that in mind we are excited to bring our first Reserve store to the main floor of the building. This one of-a-kind store format combines our immersive coffee experience -- threaded directly from the Roastery -- with fresh baking on site by Princi bakers, and will open later this fall.
As we undergo this construction process and with the summer months ahead of us, now is also the perfect time to introduce you to one of our most sought-after licensed store formats – the Starbucks mobile truck. Over the next few weeks, the teams are preparing to “roll in” this unique experience on the front patio so that there can be a gathering place for partners and customers, outside, during the much-anticipated warmer weather of Seattle’s summer.
While there is much more to come in the Support Center these first steps for our stores are an exciting moment for the working teams. Surrounded by some of the savviest coffee connoisseurs in the world, our hometown and this building continues to serve as inspiration - where we try new things and create a culture of first-ever experiences.
Thank you for your patience as we work through this process and the remodel gets underway, we will be sure to update you on our progress.
Proud to be your partner.
Andy Adams, senior vice president, Global Store Development