It is expected that Starbucks will soon have fewer promotions, which will be the result of new solutions from this company.
Last Monday, October 14, the media, citing their sources, reported that the mentioned chain of coffeehouses is scaling back the number of promotional offers through its mobile app. According to journalists, the relevant decision of the company is aimed at forming such a format of activity in terms of the specifics of the business model of the relevant process, in which customers will pay for coffee and tea at full price. It’s worth noting that this information has been confirmed by several media outlets.
The specified solution is part of the strategy of the company’s new chief executive officer Brian Niccol. In this case, it implies a strategy that aims to reposition the firm as a premium brand. Also, as part of the approach of the new head of the company, the goal is to reduce the strain on employees who get flooded with work during the most active phases of promotion campaigns.
Last month, Starbucks offered extra loyalty points on Tuesdays. The company also implemented a solution providing deals on several drink purchases on Saturdays. It is worth noting that these offers were a shift from the deeper discounts that were in effect for several months in the current year and included, among others, Buy One, Get One Free, and 50% off.
According to media reports, the company does not intend to run broad offers during the holiday season. Instead of this decision, according to journalists, the firm plans to promote seasonal drinks through advertising.
It’s worth noting that in the past, Starbucks has mostly avoided coffee promotion. At the same time, at the beginning of the current year, the company ramped up the relevant practice. This decision was made and implemented to lure back customers.
Currently, Starbucks is reversing its business strategy. The corresponding decision is one of the first structural and fundamental moves under Brian Niccol, who took over the company in September.
It is worth noting that Starbucks sales have been on a downward trajectory for two consecutive quarters. In July, information was released according to which sales in the company’s stores opened for at least a year fell by 3% worldwide. In North America, which is the domestic market for the firm, the corresponding indicator decreased by 2%.
Last week, Bank of America analysts released a research note in which they noted that recently Starbucks locations have stopped being visited by infrequent customers who usually come in the afternoon. Also in this note, experts underlined that the mentioned tendency applies to clients aged 18 to 29 years.
Brian Niccol, as reported by the media, wants to make Starbucks a coffee shop again, not just an online-driven business. Last month, in a letter to employees and customers, he stated his intention to return the company to its roots as a community coffeehouse with comfortable seats, improved design, and a clear distinction between to-go and for-here service. Brian Niccol separately noted that, according to the general opinion, the firm has drifted from its core. He also stated that the Starbucks team is currently committed to elevating the in-store experience — ensuring spaces reflect the sights, smells, and sounds that define the firm.
As we have reported earlier, Starbucks Ends NFT Program.
