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Starbucks’ massive expansion plans reveal the future of service

(BUSINESS NEWS) Starbucks unveiled their five-year plan and doing so is a sneak peek into what others will soon be emulating.

starbucks touch case

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.

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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.

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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.

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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.

#Starbucks

Written By

Brian is a staff writer at The American Genius who lives in Brooklyn, New York. He is a graduate of Washington University in St. Louis, and majored in American Culture Studies and Writing. Originally from California, Brian has a podcast, "Revolves Around Me," and enjoys public transportation, bicycles, the beach.

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