Brian Niccol, the new CEO of Starbucks, recently said that the company will be making a lot of big changes to try to boost sales and get people to come back to its shops.
Customers will no longer have to pay extra for drinks with nondairy milks like soy, oat, or almond milk. The cafe will also have a condiment bar again and give clay mugs to people who stay longer.
In its most recent quarterly earnings report, Starbucks SBUX 1.49% said that sales in the U.S. were lower because fewer people were going to its shops.
Clark Wolf, a consultant with over 35 years of experience in the food business, told MarketWatch, “They should stop charging for all the different milks. Part of the reason is that it’s not worth the time to ask and do.” “And the condiment thing is normal at a coffee shop.” For running a business to be easy, there are too many possible outcomes.
Wolf said he agrees with all of Starbucks’s new rules, but he pointed out that many of the changes are just Starbucks going back to some of its old rules instead of coming up with something completely new. He thinks the business should put more emphasis on the in-store experience for customers and speed up the buying process.
“They have paid more attention to online ordering at some places than to the window or the counter.” “The most loyal customer is leaving,” Wolf said. “A loyal Starbucks customer is one who talks to someone when they go in.”
“It’s okay for the person who wants all that nonsense, but not for the people behind them.” “We go to coffee shops to get the drink we want, make ourselves at home, and have a nice time,” he said.
Other analysts who recently talked to MarketWatch were also generally positive about Starbucks’ changes. However, some analysts think that the new way of doing things could cost a lot of money. “The early effects of intensified investments will likely cause 2025 to be a ‘reset year’ for earnings,” said Oppenheimer analysts not long ago.
What do people who buy things think? Do they like these new additions? Do they think there are other things that should be fixed?
A 28-year-old content maker from New York named Cord Lehman said he goes to Starbucks almost every day and really likes some of the changes, like getting rid of the extra charge for nondairy drinks.
Lehman told MarketWatch, “Getting rid of the extra fees for the nondairy items is a win.” “Everybody’s body is different, and each stomach can handle different amounts.” Because you like soy or almond milk better than whole milk, you shouldn’t be “punished.”
Megan Nicholson, a teacher from California who is 37 years old, also gets her Starbucks order with soy milk and liked the change.
Nichlson said, “Because I can’t handle lactose, I have to order the soy milk, and I don’t believe I should have to pay more for it.” “Getting rid of these fees will make me keep coming back.”
It was said by Starbucks that adding nondairy milk is the second most popular option after adding a shot of espresso. Since the extra fees would no longer be there, the prices of those drinks would go down by 10%.
A 22-year-old from West Virginia named Chanakya M. is one of many regular Starbucks customers who told MarketWatch they want the chain to offer better food. People told them they want “healthy breakfast sandwiches, not the frozen ones,” and they hope the quality gets better overall.
A separate value menu for some foods or drinks was another change that many Starbucks customers who spoke with MarketWatch brought up.
Nicholson said, “I think a value menu would work well, with some drinks being on sale regularly or almost regularly.” “Sometimes they have deals where you can get two for $10. There should be more of those.”
Chiccol, who came to Starbucks from Chipotle Mexican Grill Inc. CMG 1.03%, said that the most recent earnings report was “very disappointing.” He also said, “It is clear we need to fundamentally change our strategy to win customers back and return to growth.”
Starbucks’ net income was $909.3 million, or 80 cents per share. This is less than the $1.22 billion, or $1.06 per share, it made in the same quarter last year. Sales at the same shop went down by 7%.
