A big five year plan
Starbucks announced its five-year strategic plan this week, which is centered around plans to grow revenue by 10 percent and open 12,000 new stores globally by 2021, largely in the U.S. and China.
Of course, the plan goes into more detail than that, pinning their premium Reserve Roasteries and new technology, both on mobile and in stores, as the big focuses.
As Starbucks’ visionary CEO Howard Schultz prepares to step down to focus on the development of the company’s premium Reserve Roasteries, it’s becoming clear that the new premium products and experiences available at these stores are a key to growth.
Kevin Johnson, the seven-year board member who will be taking the reigns as CEO in April, said he thinks the offerings of Reserve Roasteries can be segmented strategically across all Starbucks stores.
Tech meets coffee
An obvious first thing to notice about the Reserve Roasteries is the the digital ordering system and other new tech integrations. But it may be the coffee itself that deserves the most attention.
With plans to open new Roasteries in Shanghai, Tokyo, and New York City over the next two years, Starbucks is certainly betting on a concept. It also hopes customers will be as excited about pour-over as they are about pumpkin spice.
Consumers tend to like experiences, and place more value in them. A flashy store with brewed-to-your-taste artisanal coffee, in addition to innovative ordering and payment, can hit on this from two angles.
At a Reserve Roastery in London’s Leicester Square, the main draws for customers are things like fully digital ordering system and wireless charging. They also can choose from industry-leading brewing methods such as Syphon, Chemex and V60 Pour Over.
These new stores may be an attempt to put Starbucks in the same category as – or even in a category above – premium coffee roasters like Blue Bottle, Stumptown, or Philz.
What’s on the menu?
With thousands of stores around the world, Starbucks won’t limit it’s Roastery beverages or new technology to just the new stores, but they do serve as a hint at where Starbucks may hope to be in the future.
Earlier this year, the new Smoked Butterscotch Latte and Nitro Cold Brew were introduced on limited-time availability at about 500 locations in the U.S., Canada and China.
You can also now find wireless charging docks at over 1,400 locations and order from a mobile phone at any U.S. Starbucks location, but these technologies may no longer differentiate Starbucks or truly make it a memorable experience.
So, while research suggests that consumers will flock towards new concepts, new technology, and new menu items temporarily, Starbucks will have to prove long-term that their new drinks can bring the same joy as the Willy Wonka-inspired cafes they’ll be served in.
The five-year plan is largely dependent on the success of the premium concept as a whole. In the end, we’ll still likely pick (or avoid) Starbucks because of their drink menu above all else.
Too connected: FTC eyes Facebook antitrust lawsuit
(BUSINESS NEWS) Following other antitrust hearings, we’re expecting to hear more about the FTC’s antitrust lawsuit against Facebook, soon.
Facebook might be wishing it had kept the “dislike” button.
On September 15, the Wall Street Journal announced that the Federal Trade Commission was preparing a possible antitrust lawsuit against the social media titan. Although the FTC has not made an official decision on whether to pursue the case, sources familiar with the situation expect a determination will be made on the matter sometime before the end of 2020. Facebook and the FTC both declined to comment when asked about the story.
The news comes following a year-long investigation by the FTC that has looked into anti-competitive practices by the Menlo Park-based company. This past July, the United States House of Representatives held hearings in which they grilled the CEOs of Amazon, Apple, Google, and Facebook regarding their business practices. In August, Facebook CEO Mark Zuckerberg also testified in front of the FTC as part of the department’s antitrust probe into the organization.
The FTC seems to be especially interested in Facebook’s past acquisitions of WhatsApp and Instagram, which they believe may have been done to stifle competition. In internal emails sent between Zuckerberg and Facebook’s former CFO David Ebersman back in 2012, the 36-year-old seemed worried that the apps could eventually pose a threat to the social media conglomerate.
“These businesses are nascent but the networks established, the brands are already meaningful, and if they grow to a large scale the could be very disruptive to us,” Zuckerberg wrote to Ebersman, “Given that we think our own valuation is fairly aggressive and that we’re vulnerable in mobile, I’m curious if we should consider going after one or two of them.”
When Ebersman asked him to clarify the benefits of the acquisitions, Zuckerberg stated the purchases would neutralize a competitor while improving Facebook.
“One way of looking at this is that what we’re really buying is time. Even if some new competitors springs up, buying Instagram, Path, Foursquare, etc. now will give us a year or more to integrate their dynamics before anyone can get close to their scale again.” Zuckerberg said.
This isn’t the first time the FTC has investigated Facebook either. Last year the agency fined the company $5 billion for the mishandling of user’s personal information, the biggest penalty imposed by the federal government against a technology company. As a part of the settlement with the FTC in that case, Facebook also promised more comprehensive oversight of user data.
If the FTC does pursue an antitrust suit against Facebook, it could end up forcing the social media giant to spin off some of the companies it has acquired or place restrictions on how it does business. Considering how long it will take to file the litigation and prove the case in a courtroom, however, it seems that Zuckerberg will once again be “buying time.”
What you need to know about the historic TikTok deal (for now)
(BUSINESS NEWS) No one really knows what’s happening, but the TikTok deal’s impact on business, US-China relations, and the open internet could be huge.
So, maybe you’ve heard that Oracle and Walmart are buying TikTok for national security!
Um, not exactly.
Also, Trump banned TikTok!
Sort of? Maybe?
The terms of the proposal seem to shift daily, if not hourly. The sheer number of contradictory statements from every player suggests no one really knows what’s going on.
Just one example: Trump said the deal included a $5 billion donation to a fund for education for American youth. TikTok parent ByteDance, said, “Say what now?”
Here’s what we think we know (as of this writing):
Oracle and Walmart would get a combined 20 percent stake in a new U.S.-based company called TikTok Global. Combine that with current US investors in China’s ByteDance, TikTok’s parent, that would give American interests 53 percent. European and other investors would have 11 percent. China would retain 36 percent. (On Saturday Trump said China would have no interests at all. But that does not jibe with the reporting on the deal.)
Oracle would host all user data on its cloud, where it is promising “security will be 100 percent” to keep data safe from China’s prying eyes. But reporting has differed on whether Oracle will get full access to TikTok’s code and AI algorithms. Without full control, skeptics say, Oracle could be little more than a hosting service, and potential security issues would remain unaddressed.
Walmart says they’re excited about their “potential investment and commercial agreements,” suggesting they may be exploring e-commerce opportunities in the app.
The US Committee on Foreign Investment in the United States, which is overseen by Treasury Secretary Steven Mnuchin, still has to approve any deal.
As for the TikTok “ban” – which isn’t really a ban because current users can keep it – the Commerce Department postponed the deadline for kicking TikTok off U.S. app stores to September 27, to give time for the deal to be hammered out. Never mind that it’s still not clear whether the U.S. government has authority to do that. Unsurprisingly, ByteDance says it doesn’t in a lawsuit filed September 18.
Whatever happens with the whiplash of the deal’s particulars, there are bigger issues in play.
According to business news site Quartz, moving data storage to Oracle mirrors what companies like Apple have done in China: Appease the Chinese government by allowing all data hosting to be inside China. A similar move could “mark the US, too, shifting from a more laissez-faire approach to user data, to a more sovereign one,” says China tech reporter Jane Li.
In the meantime, TikTokkers keep TikTokking. White suburban moms continue to lip sync to rap songs in their kitchens. Gen Z continues to make fun of the president – and pretty much everything else.
And downloads of the app have skyrocketed.
Hobby Lobby increases minimum wage, but how much is just to save face?
(BUSINESS NEWS) Are their efforts to raise their minimum wage to $17/hour sincere, or more about saving face after bungling pandemic concerns?
The arts-and-crafts chain Hobby Lobby announced this week that they will be raising their minimum full-time wage to $17/hour starting October 1st. This decision makes them the latest big retailer to raise wages during the pandemic (Target raised their minimum wage to $15/hour about three months ago, and Walmart and Amazon have temporarily raised wages). The current minimum wage for Hobby Lobby employees is $15/hour, which was implemented in 2014.
While a $17 minimum wage is a big statement for the company (even a $15 minimum wage cannot be agreed upon on the federal level) – and it is no doubt a coveted wage for the majority of the working class – it’s difficult to not see this move as an attempt to regain public support of the company.
When the pandemic first began, Hobby Lobby – with more than 900 stores and 43,000 employees nationwide – refused to close their stores despite being deemed a nonessential business (subsequently, a Dallas judge accused the company of endangering public health).
In April, Hobby Lobby furloughed almost all store employees and the majority of corporate and distribution employees without notice. They also ended emergency leave pay and suspended the use of company-provided paid time off benefits for employees during the furloughs – a decision that was widely criticized by the public, although the company claims the reason for this was so that employees would be able to take full advantage of government handouts during their furlough.
However, the furloughs are not Hobby Lobby’s first moment under fire. The Oklahoma-based Christian company won a 2014 Supreme Court case – the same year they initially raised their minimum wage – that granted them the right to deny their female employees insurance coverage for contraceptives.
Also, Hobby Lobby settled a federal complaint in 2017 that accused them of purchasing upwards of 5,000 looted ancient Iraqi artifacts, smuggled through the United Arab Emirates and Israel – which is simultaneously strange, exploitative, and highly controversial.
Why does this all matter? While raising their minimum wage to $17 should be regarded as a step in the right direction regarding the overall treatment of employees (and, hopefully, $17 becomes the new standard), Hobby Lobby is not without reason to seek favorable public opinion, especially during a pandemic. Yes, we should be quick to condone the action of increasing minimum wage, but perhaps be a little skeptical when deeming a company “good” or “bad”.
Business Marketing3 days ago
Use the ‘Blemish Effect’ to skyrocket your sales
Opinion Editorials2 weeks ago
The actual reasons people choose to work at startups
Tech News3 days ago
Degree holders are shifting tech hubs and affordability
Business News2 weeks ago
Hobby Lobby increases minimum wage, but how much is just to save face?
Business Finance2 weeks ago
Small business owners furious over more PPP fraud this week
Social Media1 week ago
We watched The Social Dilemma – here are some social media tips that stuck with us
Tech News1 week ago
What is UI/UX? Take a little time to learn for free!
Social Media2 weeks ago
Instagram makes IGTV videos more accessible with automatic closed captions