Starbucks is demonstrating significant progress, having achieved its first growth in comparable transactions in the U.S. in the last eight quarters. However, revitalizing sales is only the initial step in their broader strategy.
As the company gears up for its Investor Day presentation on Thursday, leadership is eager to unveil the next phase.
Chief Operations Officer Mike Grams discussed with Business Insider the upcoming transition, stating, “We’re entering a stage of ‘Back to Starbucks’ aimed at enhancing the overall Starbucks experience. Our vibrant culture is underpinning this journey, complemented by the positive sentiments that both customers and partners hold towards Starbucks, making this a thrilling time.”
Industry analysts note that Starbucks still has to validate its recovery. Ahead of the investor event, some experts expressed the need for more defined long-term financial objectives, clarification on anticipated cost savings, and concrete examples of how investments in store renovations and staffing adjustments will restore profit margins.
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Analysts caution that without more transparency, enthusiasm for the company’s cultural renewal may not suffice to uphold investor trust.
Here’s what to anticipate from Grams in the years leading up to 2026 and beyond.
Store Redesigns
Starbucks has already completed roughly 200 out of its planned coffeehouse redesigns aimed at creating an environment that encourages patrons to stay a little longer, as noted by CEO Brian Niccol during Wednesday’s earnings discussion.
The Investor Day event marked the first comprehensive public showcase of these renovations, which feature digital menu boards, warmer aesthetics, and accommodating seating.
Starbucks
Grams described the remodels as a “momentum-building move,” costing approximately $150,000 each and typically completed overnight, with plans to finish over 1,000 store remodels by the end of this fiscal year in September.
Menu Enhancements
Starbucks is also refreshing its menu, unveiling a new spring selection that includes innovative espresso, matcha, and chai drinks, as well as fresh bakery offerings.
“Our pace of innovation is increasing,” Grams remarked. “We have moved from offering just four seasonal updates a year to a more rapid introduction of items.”
However, introducing new beverages poses operational challenges, as each drink requires baristas to learn distinct recipes. Grams emphasized that the objective is to collaborate closely with in-store teams to streamline this process while ensuring it does not complicate workflows.
During the earnings call, Niccol also highlighted the company’s commitment to enhancing its wellness-oriented menu, increasing the focus on protein-rich drinks and healthier snacks, particularly during the afternoon, to drive repeat visits.
Technology and Equipment Improvements
Baristas will soon utilize upgraded tools to actualize this strategy.
Green Dot Assist, Starbucks’ advanced virtual assistant, is set to receive enhancements, Grams disclosed, as it becomes available in all cafés. Staff can access this tool through an in-store tablet, which provides recipes and other essential information, eliminating the need to struggle with outdated reference materials.
Grams mentioned, “The future of implementing technology in our coffeehouses revolves around empowering baristas and leadership teams to make quicker decisions.
Looking ahead, Grams indicated plans for a scheduling system that efficiently incorporates demand forecasts, weather analytics, and staff availability.
Additionally, Starbucks is set to revamp its point-of-sale systems and roll out a new espresso shot puller designed for cold beverages, the Mastrena Presta. Beginning in 2027, the newest espresso machine, the Mastrena 3, is expected to halve the time needed to prepare a quadruple shot of espresso.
Starbucks
Starbucks serves over a billion espresso shots annually, and with a commitment to meeting the four-minute service standard, the new machinery should greatly enhance operational efficiency, an area that Niccol noted still needs improvement.
Enhanced Staffing Strategies
Grams identified a critical realization regarding the necessity for a more structured staffing framework within Starbucks locations, developing clear pathways for employees to advance in their careers, which will help diminish turnover rates.
Recently, Starbucks introduced a new “coffee house coach” position, which expands upon and redefines the assistant store manager role as part of the initiative to fill 90% of leadership positions with internal hires. According to Grams, this role aims to encourage staff to remain in the same location for three years.
Last quarter, the company promoted over 7,000 employees into management roles including barista trainers and shift supervisors.
Refined Success Metrics
Grams indicated that upon his joining Starbucks a year ago, the corporate team was tracking nearly 40 different metrics for coffeehouses; he has since streamlined this focus.
Starbucks is now emphasizing:
- Customer Experience: “Are customers satisfied? Did they receive what they expected?”
- Peak Performance: “Can we efficiently serve customers through all four channels of every store within a reasonable timeframe while ensuring a meaningful interaction?”
- Employee Scheduling: “Hire those who fit the business’s needs, while also ensuring they receive the hours and shifts they signed up for.”
- Inventory Management: The company aims to empower coffeehouse leaders to order supplies precisely when necessary, as indicated by Grams.
- Health and Sanitation: “Are we maintaining cleanliness? Are we doing everything necessary to prevent incidents within Starbucks?”
Starbucks is empowering coffeehouse leaders by not imposing top-down algorithms for tracking these metrics. Each core measure yields a “shot score” from one to five, with a five representing the highest level of performance. Grams noted that five-star locations achieve nearly three times the sales growth compared to lower-rated stores, validating the effectiveness of these selected metrics.
Updated Rewards Initiative
In a move to enhance customer loyalty, Starbucks is revamping its rewards program, reinstating a tiered structure, extending the redemption period for complimentary birthday treats, and creating a new reward tier that offers a $2 discount on any purchase for redeeming 60 points (termed stars).
Moreover, the company plans to enrich recognition programs for employees, and top-performing store managers will have unique opportunities, although further details were not disclosed.
Ultimately, Grams emphasized that this new phase is anchored in focus and execution.
“What I’ve learned is we don’t need to change our identity; we must simply excel at what we already do,” Grams noted in his discussion with Business Insider.
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### Hustle Verdict
Our take is that Starbucks’ strategic shifts mark a monumental turning point for the company as it seeks to rejuvenate its brand and customer experience. We believe these comprehensive changes are not just about maintaining relevance but also about setting a foundation for sustained growth in a competitive market. The bottom line is that if Starbucks can effectively implement its revitalization plan, it could transform industry norms regarding customer engagement and operational efficiency.
