Thanks for Visiting!

Register for free to get the full story.

Sign Up
Already have a Placer.ai account? Log In
Dining

Starbucks' New Makeover

We dive into Starbucks visit data to see how the coffee chain is doing, and what lies behind its newly unveiled expansion plans.

By 
R.J. Hottovy
September 26, 2022
Starbucks' New Makeover
SHARE
Explore our free tools to get timely insights into key industries
Check out the latest trends for
No items found.
Key Takeaways

Starbucks, the most prolific coffee chain in the country, recently unveiled a dramatic expansion plan. The chain hopes to not only add 2,000 stores to its nearly 16,000-strong fleet by 2025 but to also new implement new strategies in a bid to maximize sales and customer reach by embracing technology. 

We dove into the foot traffic data for the coffee giant to understand what lies behind this decision and whether the opportunity is really there.

Coffee Chain's Continued Confidence

Starbucks was a pandemic winner, with elevated visits throughout much of the period. This was an especially impressive feat for a brand that does see heavy traffic in urban areas and on work commutes - two areas that were hit especially hard by the pandemic. 

As the new year began, the chain did see its visits drop as a combination of Omicron, and inflation kept people from venturing out. Yet, even within this difficult environment, the coffee chain has seen visits above or near pre-pandemic levels throughout the year. And looking at recent visits compared to a January 2019 baseline shows August visits up by 2.6%, an impressive showing considering the economic climate.  

Tapping Into Unfulfilled Demand

And in an effort to maximize the ongoing surge of demand the brand is still seeing, the company is putting a heavy emphasis on driving efficiency. "One of our challenges today is that we're not able to meet the capacity of demand that is coming through our stores," said Brady Brewer, chief marketing officer at Starbucks. Long wait times and lines are one of the culprits keeping potential customers from visiting Starbucks. 

In hopes of addressing the long wait times and improving customer reach, the chain announced that it would be rolling out more of its small-format stores, which cover around 400 sq.ft. compared to a typical Starbucks store's 2,000 sq.ft. 

And there is reason to believe this strategy could help improve efficiency. Looking at a group of small-format locations over the past twelve months (trailing-12 month, or TTM) compared to nearby full-size locations, shows that small format stores saw around 15% more visitors per square meter than the regular locations. These numbers are likely driving the decision to dedicate a significant portion of its expansion plans to ramp up infrastructure for pickup and drive-thru by 2025, unveiling automatic drink machines, and enhancing its in-app ordering capacities to lower bottlenecks at the register. By optimizing store size and focusing on automation, Starbucks should see a more efficient reach in key markets.

Expanding into New Markets

But for a brand that already owns so much of the market, how much expansion potential is there? 

Looking at the data indicates that it could be quite a bit.

Starbucks identified where it was underrepresented on a store per population basis and is planning its expansion in those areas, which are primarily clustered in the Midwest and Southeast. And reviewing Starbucks visits as a percentage of the total restaurant industry revealed that stores in those markets were underperforming Starbucks’s national average of 7.3%. Visits to Louisville, Memphis, and Knoxville Starbucks locations made up roughly 5% of all restaurant visits in those cities. In comparison, Cincinnati and Indianapolis made up 3.2% of all restaurant visits. 

These smaller markets are often the most receptive to new retail investment. Choosing locations in an unsaturated market allows the chain to capitalize on reduced rent and overhead, as well as tapping into unmet consumer demand – a potential driver of sales. 

Things Looking Up For Starbucks

Starbucks has the largest market share of any coffee chain across the country. It hopes to expand its dominance by implementing growth strategies based on data, tapping into unfilled markets, and automating its drink-making processes. 

Will this expansion help Starbucks capture more of the market? Visit placer.ai to find out.

Learn how downtown regions across US cities are measuring up with our free tools.
Check out the latest trends for
No items found.

Related Topics

Explore our free tools to get timely insights into key industries
Check out the latest trends for
No items found.
SHARE
Get 3 brand & industry
breakdowns every week
Subscribe to the newsletter
Oops! Something went wrong while submitting the form.

Get a Demo

Please enter your first name
Please enter your last name
Please provide a valid email
Please enter your email
Please enter company name

Thanks for reaching out!

One of our experts will be in touch soon

Try Placer.ai Free
Oops! Something went wrong while submitting the form.

Recent Publications

Get 3 brand & industry breakdowns every week

Subscribe to the newsletter
Text Link
Coffee
Text Link
Starbucks
Five Below and Ollie’s Bargain Outlet: A Pre-Holiday Snapshot
Kroger: Getting into The Seasonal Swing 
Avison Young Launches Office Busyness Index Powered by Placer.ai to Provide Unmatched Insights on Office Utilization Across Major U.S. Markets
Off-Price Ahead of the 2024 Holiday Season
A Beautiful Season Ahead: Ulta and Sally Beauty Supply
Sportswear Ahead of the 2024 Holiday Season 
Placer 100 Index: October 2024 Recap 
Placer.ai Office Index: October 2024 Recap
Placer.ai Mall Index: October 2024 Recap 
Halloween’s 2024 Retail & Dining Impact – Party City Carries the Season
Checking in With Department Stores: Nordstrom and Macy’s
Superstores and Wholesale Clubs Ahead of the Holidays
Home Depot and Lowe’s Heading Into the Holidays
Starbucks and Dutch Bros: Short Visits Lead the Way
Planet Fitness: Raising the Bar(bell)
Checking in With Full-Service Restaurants: First Watch, Chili’s, and Outback Steakhouse
RBI and Yum!: QSR Resilience in 2024
Boot Barn and DSW: Stepping Up Their Game
Target’s October Circle Week: A Data-Driven Snapshot
Chipotle, Shake Shack & Wingstop: Dining Success in Q3 2024
Playa Bowls and Tropical Smoothie Cafe: Berry Big Business
Cheesecake Factory & BJ’s Restaurants: Full-Service Success
Checking in on McDonald's and Wendy's 
Sprouts Farmers Market: A Specialty Grocer With a Traditional Twist
CAVA: The Craze Continues
Placer.ai Reaches $100M Annual Recurring Revenue
Catching Up With Carter's 
A Texas Roadhouse and LongHorn Steakhouse Showdown
Placer.ai Mall Index: September 2024 Recap – Labor Day Peaks and Holiday Season Predictions
Albertsons Q3 Check-In
Looking Ahead to the 2024 Holiday Season
Trader Joe's: Continuing to Thrive in 2024
Bowlero and AMF: A Ten-Pin Knockout
Recreational Retail: Store Performance in 2024
Placer.ai White Paper Recap – September 2024
A QSR and Fast-Casual Face-Off
Sam’s Club’s In-Store Retail Media Network Opportunity
The Rising Stars: Six Metro Areas Welcoming Young Professionals
Costco in 2024: A Deep Dive
Sherwin-Williams in 2024: Brighter Than a New Lick of Paint
Life Time and Orangetheory: Premium Fitness Flourishing
C-Stores: More Than A Pit Stop
Darden: Dining Dominance Undeterred 
Placer 100 Index for Retail and Dining: August 2024 Recap
Placer.ai Office Index: August 2024 Recap
Placer.ai Mall Index: August 2024 Recap – Back-To-School In Full Swing
Auto Parts Retailers: The Traffic Continues
Pumpkin Spice Works its Magic Once Again
School Season Sparks Retail Growth
Placer.ai White Paper Recap – July & August 2024
Big Lots’ Big Rightsizing Move in Four Data Points
Fun Away From The Sun: Checking in With Eatertainment
Domestic Migration and Population Growth: Strong Currents Off The Carolina Coast
The Civic Impact of Summer Events
Retail Trends in College Towns: A Back-to-School Snapshot
Five Below and Ollie’s Bargain Outlet: Consumers Still on the Hunt for Discounts
Macy’s & Bloomingdale’s: Into 2024 and Beyond
Limited Time Only: The Trend Continues
Beauty in 2024: Many Ways to Win
Dollar General & Dollar Tree: Powering Ahead in Q2 2024
The Home Depot and Lowe's Foot Traffic Remodel in Q2 2024
Superstore Update: Summer Savings Spree
Placer.ai Mall Index: July 2024 Recap – From Fourth of July to Back-to-School
Placer.ai Office Index: July 2024 Recap
Summer Movie Madness: Blockbuster Films Boost Foot Traffic
Driving Success: Toyota in 2024
Denny’s and IHOP: An All-Day Breakfast Matchup
Warby Parker: Seeing Clearly Now
Planet Fitness at the 2024 Halfway Point
Serving Summer 2024: RBI and Yum! Brands Q2 Foot Traffic
Starbucks, Dutch Bros., Dunkin’: Finding Summer Success
Fast Food and Fast Casual Favorites, Plus CosMc’s Takeoff
Chipotle and Sweetgreen: Fast-Casual in Q2 2024
First Watch, Texas Roadhouse, and Applebee’s: An FSR Roundup
Albertsons Companies: H1 2024 Recap
Teaming Up For Success: Sports Stadium Sponsorships
Limited Time Offers: Price Wars Boost Visits
Placer 100 Index for Retail & Dining: June 2024 Recap
Placer.ai Mall Index: June 2024 Recap
Placer.ai Office Index: June 2024 Recap
Inside Out 2: The New Blockbuster Bringing Crowds Back to Theaters
Petco and PetSmart: A Head to Head
Frozen Delights: Exploring Ice Cream Chains Across America
Placer.ai White Paper Recap – June 2024
Barnes & Noble: Writing a New Story
Small Format Stores - Sprouting, Blooming, and Expanding
Retail and Dining on Father’s Day
Thrift Store Visit Scores
Charting Value Grocery’s Visit Growth
Placer 100 Index for Retail & Dining: Introduction and May 2024 Recap
Digging Into Darden: Q2 2024 Update
2024 Retail and Dining Trends Update
TRU and avid: Midscale Hotels on the Rise 
Diving Into Kroger: A Strong Start to 2024
Placer.ai Mall Index: May 2024 Recap – Mall Visits on the Rebound
Placer.ai Office Index: May 2024 Recap
2024 Memorial Day Recap
Las Vegas: A Tourism and Migration Deep Dive
Eatertainment Chains: Full on Food, Fun, and Foot Traffic
The Promise of Luxury Apparel