K A S H R U T . C O M_©

Starbucks sees three drivers to product strategy

November 9, 2023 - from the Food Business News:

"Starbucks Corp. is gearing up for new all-day snacking platforms and an elevated baked foods offering, part of a product strategy that company executives expect to lift the brand and unlock growth.

"In terms of targeted daypart innovation, Mr. Brewer said Starbucks continues to grow its peak morning business in North America. The company also has grown its afternoon daypart, though opportunities to further accelerate that daypart exist, he said. A third daypart — the period between lunch and dinner — is set to expand through new menu offerings, he said.

"'This strategy has helped drive our North America food business to nearly $6 billion annually in fiscal ’23,' Mr. Brewer said. 'A perfect example of this is how we’ve served our customers’ love for all-day breakfast. Our egg sandwiches and our unique Sous Vide Egg Bites offer customers a high-protein, satiating recharge. In our North America company-operated business, these all-day breakfast categories grew 20% with total North America sales of these products approaching $3 billion. It grew 20% overall but 26% in the afternoon daypart. So we know we’re on to something.'

Food becoming more important to Starbucks

December 7, 2023 - from the Food Business News:

"Growing Starbucks’ food business has long been a goal for many of the company’s past chief executive officers. But as the company’s business has diversified through the surge in drive-thru, mobile and delivery sales, growing the food business has become a priority for new CEO Laxman Narasimhan.

"Speaking Dec. 5 at the Morgan Stanley Global Consumer & Retail Conference, Mr. Narasimhan identified some of the challenges and opportunities he faces to grow the company’s $6 billion food segment.

"Food application opportunities for Starbucks include all-day breakfast and snacking, particularly in the afternoon.

"Speaking Nov. 2 at Starbucks’ “reinvention update,” Brady Brewer, vice president and chief marketing officer, added, “snacking, it turns out, is one of the fastest-growing macro consumer trends in the US, reaching now a $110 billion market segment. We know our customers are looking for snacks and particularly wholesome and premium snacks. So, in addition to new grab-and-go food products, we’ll also offer a widening snack selection.”

"Helping the company achieve its food goals, Mr. Narasimhan said, are improved warming ovens and implementation of Starbucks’ Siren System. Siren is intended to simplify tasks in both the company’s beverage and food platforms. With the system, the time it takes to make a mocha Frappuccino is reduced to 35 seconds from 83 seconds, according to the company, and the time to warm a breakfast sandwich or egg bite also is reduced. A key to speeding the food warming process is the food is warmed and served in the same packaging.

"But despite the emphasis on food, Mr. Narasimhan also emphasized that beverages are the heart of Starbucks’ strategy."

cRc Kashrus information on Starbucks including a cRc kashrus guide to Starbucks beverages