Starbucks reveals its three innovation plans for next decade growth

Jasmine Lee-Zogbessou 22nd March 2018 (Last Updated March 22nd, 2018 12:31)

Starbucks CEO Kevin Johnson has announced innovation plans to propel the American coffeehouse chain’s next decade of growth at the company’s 26th annual meeting of shareholders.

Starbucks reveals its three innovation plans for next decade growth
Starbucks CEO, Kevin Johnson, speaks at the Starbucks Annual Meeting of Shareholders on innovation growth. Credit: Starbucks.

Starbucks CEO Kevin Johnson has announced innovation plans to propel the American coffeehouse chain’s next decade of growth at the company’s 26th annual meeting of shareholders.

More than 3,500 shareholders, employees, guests and board members were present yesterday (21 March) as the group president and chief operating officer, Roz Brewer, executive vice president and chief partner officer Lucy Helm, chief executive officer of Starbucks China, Belinda Wong and Johnson presented.

The company reflected on its performance over the past five years, which saw a doubling in market value and revenue growth from $14bn to $23bn, before detailing three innovation growth drivers in digital engagement, the growing Chinese market and premium brand Starbucks Reserve.

Johnson said: “No retailer is better positioned to meet the changing needs of today’s consumer, as expectations of convenience and community redefine what it takes to be a successful and relevant brand.

“The story of our growth over the past five years is grounded in key innovation investments we have been making for our future, and this continued focus will ensure we build upon on our leadership position in this rapidly changing retail environment.”

Starbucks aims to increase digital engagement by growing relationships with over 60 million current US customers per month who are not members of Starbucks Rewards.

“We see too many examples of businesses choosing between an experience that solely focuses on convenience or one that simply highlights community.”

Johnson said: “When it comes to how a retailer focuses on the customer, we see too many examples of businesses choosing between an experience that solely focuses on convenience or one that simply highlights community.

“But we don’t believe there needs to be this type of a trade-off, and our third place can and will continue to unite both experiences.”

An additional focus included growing the chain’s relevancy in China, with plans to open more than 5,000 stores by 2021.

Wong said: “We are humbled by how customers have embraced our third place experience, while the core of our success in China has been our partners, who deliver the unique moments of connections with our customers each day.

“As a key growth engine for Starbucks, we are excited to continue to scale and imagine what is possible for Starbucks in China.”

The final focus, Starbucks Reserve, will see the company continue to invest in the expansion of its premium Reserve brand, which focuses on its small-lot coffee, retail experiences and Italian artisan food by Princi.

Brewer said: “There is so much work going into our store designs and locations, how our partners show up for our customers and how we extend the in-store Starbucks Experience to a meaningful digital engagement.

“With our partners and coffee passion at the centre of it all, the opportunity to build a reimagined Starbucks Experience is real. And we have the right strategy and people making it happen.”