Dive Brief:
- Starbucks' digital initiatives drove a third of its 6% comparable store sales increase during Q3 of 2019, said Kevin Johnson, CEO of Starbucks, during the company's Q3 earnings call.
- Among the key strategies laid out by the company were the continued focus on Starbucks' app-based rewards program, which hit the 17.2 million 90-day active user mark, and is growing 14% YoY.
- Digital initiatives like its rewards program look to cater to a "digitally-savvy" customer base that expects higher levels of convenience and a more personalized experience, Johnson said.
Dive Insight:
For the past four years, the company has been working to reshape its approach to technology, including a name change (from "Starbucks IT" to "Starbucks Technology") aimed at changing how business stakeholders viewed tech.
This week, the company announced its plans to dive deeper into the tech realm. A new venture called Brightloom, a restaurant tech company, will look to license of specific elements of Starbucks digital flywheel software.
"Brightloom is going to be in a position to service those Starbucks license partners as well as the broader industry restaurant merchants who need the same cloud-based software platform," Johnson said during the call. "I think this now gives us a solid strategy to bring the digital flywheel to our license partners globally."
As part of the deal, the coffee giant got an equity stake in the company, which raised $30 million in venture capital to go after an increasingly tech-thirsty restaurant industry.
In keeping with its interest in mobile app users, in May Starbucks began using Microsoft Azure's reinforcement learning technology to give customers order suggestions based on inventory at locations near them, weather, time and past orders.
