How to combat the Starbucks structural advantage

This article is a part of a series dedicated to taking your coffee shop from surviving to thriving in 2021. This article, focuses on Starbucks' advantage in the coffee space and how to go head-to-head with corporate coffee.

How to combat the Starbucks structural advantage

The pandemic accelerated many consumer trends that have been emerging in recent years, and few sectors saw this change more than QSR. Drive-thru and online ordering saw major acceleration during the COVID lockdowns, and large chains like Starbucks have responded in dramatic fashion.

In 2020, Starbucks announced a significant change in its store format strategy, signaling a major change in its philosophy around customer preference. Realizing how customers’ preferences were changing in favor of convenience and order ahead, and de-prioritizing the “third place” format, Starbucks announced it would close  850 traditional stores focused on “remain in store” experiences, and open 900 new ones focused on order ahead, curbside pickup, and drive-thru.

They also confirmed they are focused on leveraging the power of AI and data to optimize offers and upsell customers - “right store, right offer, right time.” But don’t take our word for it - here’s Starbucks CEO from Q1 ‘21 earnings call:

“Not only have we been adapting to and benefiting from these consumer behaviors, but we also see a clear opportunity to further modernize and reinforce our leadership position, leveraging our strength in technology and predictive analytics, as well as the continued transformation of our store portfolio, offering experiences that will drive greater customer loyalty in ways only Starbucks can do”

A single independent shop operator or even multi-store regional player can not match the Starbucks network power and data insight on its own - unless it can tap into a broader network and leverage data and customer preference across a much broader base. This is the key insight that drove the development of joe. When customers can have the same convenience they expect from corporate coffee at their local store, and find other great local shops when they aren’t near home, they will opt for local 7 times out of 10. That convenience factor includes things like stored payment, automated loyalty programs, personalized offers and upsells, and the ability to easily find great stores whether the customer is simply across town or across the country.

Joining a network like joe allows a local coffee operation to deliver a “best of both” proposition - the convenience and reliability of a corporate coffee network, but the high-touch and unique experience that only local coffee operators can deliver.

joe brings together the largest community of local-coffee lovers in the U.S.! Join the network to get unfair advantage over corporate giants. Interested? Email us at sales@joe.coffee to get started.