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“How May I Help You?”

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From customers to CxOs, Starbucks delivers world-class service

More than 70 million customers stop at a Starbucks coffee shop somewhere in the world every week. Customers are the center of what this company does—it has spent over 40 years building relationships, creating a place for communities, conversations, and connections. Everyday Starbucks strives to provide a world-class customer experience in its coffee houses.

The company’s corporate IT department shares this same mission—to provide business customers with world-class business intelligence and information products. Whether it’s coffee or IT, the customer is at the center of what they do.

How is Starbucks able to do this successfully? Laurence Norton, Starbucks’ business intelligence leader focused on strategy and solution delivery, explained at the Esri UC Plenary:

“At Starbucks, we came to the realization that one size does not fit all, whether it’s coffee or IT. For our business customers, this means a location strategy that includes everything from web maps to applications, and everything in between.”

Laurence Norton, business intelligence, Starbucks

Starbucks IT team started bold, like many of its coffee offerings, with GIS. They tackled one of their business customer’s most critical challenges right out of the gate: how to continue to grow responsibly as a company, while supporting the 20,000 stores that are already open worldwide?

To identify new store locations, more than 700 Starbucks’ employees (referred to as partners) in 15 countries, use an ArcGIS-based market planning and business intelligence solution called Atlas. Atlas provides partners with workflows, analysis and store performance information so that local partners in the field can make decisions when identifying new business opportunities.

One system for opening new stores

To explain the concept of decision making at the local community level, Patrick O’Hagan, the manager of global market planning, demonstrated Atlas to the Esri UC audience. He brought up the Chinese city of Nanning, Guangxi, population two million, on an interactive map. Currently, there are eight Starbucks stores in this city. It is the responsibility of one of Starbucks’ local partners in the field, Penny Chen, to make good decisions about opening new stores here, with the help of Atlas.

Patrick O’Hagan, manager of global market planning, Starbucks

Currently in China, there are 1,200 Starbucks stores, and the company is opening a new store almost every day. Information such as trade areas, retail clusters and generators, traffic and demographics, is important to Chen when she is making her decisions.

After analyzing a new market and neighborhood, Chen can look at specific locations. O’Hagan demonstrated how Chen would do this by zooming into an area in Nanning where three new office towers will be completed over the next two months. O’Hagan explained that after viewing this area on the map, a workflow window can be created that will help Chen move the new site through approval, permitting, construction, and eventually opening.

“This is how we start with the idea of a new store and bring it all the way through to the cutting of the green ribbon,” said O’Hagan. “And the same thing happens here in the US. In fact, our most recent store opened on July 3rd in Los Gatos, California.”

Staying locally relevant takes more than luck
Starbucks’ business partners in store development do more than build new stores. They are constantly renovating and improving existing stores to keep them locally relevant. One example is Starbucks’ Clover brewing system. 

“When you order a Clover, you watch as the stainless steel filter lower into the brew chamber, hot water is added at a precise temperature to brew your coffee for an ideal length of time,” explained Norton. “A thermal blanket surrounds the brew chamber to keep water within one degree of the ideal temperature. The result is the best cup of coffee you will ever taste: hot, aromatic, and incredibly flavorful.”

Norton showed the Esri UC audience a map of five-minute drive times to existing Clover stores in the United States. He then overlayed areas of high coffee expenditure to show potential targets where Starbucks might consider offering the Clover brewing system.

Being an outlier has its advantages

Next Norton brought in a map displaying outlier analysis of smartphone ownership. Light green areas displayed islands of high smartphone ownership. There are several areas in the southern United States where smartphone ownership is generally low, but in a few areas, pockets of high outliers can be found. Most of Starbucks coffee houses are in those locations. 

Starbucks wants to persuade these customers to start using the Starbucks mobile app. They have noticed that in areas where customers pay using the mobile app, lines move faster and overall customer satisfaction is increased. Plus, if customers use the mobile app, they can collect stars for rewards, including the ability to select beer and wine.

Esri UC attendees who just heard the great news: beer and wine is coming to Starbucks!

Yes, beer and wine is coming to Starbucks.

Norton displayed a map of pilot locations along with information on wine-away-from-home purchase patterns. As Starbucks looks to roll out the Starbucks evening menu, which includes beer and wine, to more locations, they can target existing coffee houses in areas with this type of high spending patterns.

Anticipating future events increases customer service
Starbucks is integrating its enterprise business systems with its GIS solutions in web services to see the world and its business in new ways. Norton showed an example mapping Esri partner AccuWeather’s forecasted real-feel temperature data. This forecasted temperature data can help localize marketing efforts. If there will be a really hot week in Memphis, Starbucks analysts can select a group of coffee houses and get detailed information on past and future weather patterns, as well as store characteristics. This knowledge can be used to design a localized promotion for Frappuccinos, for example, helping Starbucks anticipate what its customers will be wanting a week in advance.

Locations of Starbucks near the San Diego Convention Center.

Major events also have an impact on coffee houses. The weekend after Esri UC, 150,000 people descended on San Diego for the Pride Parade. Local baristas served a lot of customers. To ensure the best possible customer experience, Starbucks used this local event knowledge to plan staffing and inventory at locations near the parade.

From local to global – creating a sustainable business
Starbucks strives to have a positive impact everywhere—from local communities, where farmers grow the beans to roasting plants and neighborhood cafés. Sustainability and social responsibility are as important to the company as they are to its customers. 

Norton took the audience on a journey from bean to cup using an Esri Story Map. The journey began in Malawi, nicknamed the warm heart of Africa, due to its tropical climate and warm people. Norton showed images of the farms where the coffee is grown, harvested and processed by local farmers.

Starbucks Story Map at the Esri UC

To support the farmers in their communities, Starbucks developed coffee and farmer equity practices, focused on workers’ rights, economic transparency, and waste management. To help facilitate these standards, the company built farmer support centers all over the world.

Once the beans are processed, they travel from the Port of Nacala, Malawi to Seattle, Washington, where the beans are tested for quality, roasted, packaged, and shipped to coffee houses all over the globe. When the beans are sold, programs like Ethos Water and Reds Global Fund help Starbucks serve communities in Africa and across the world.

Watch the presentation by Starbucks. Learn more about GIS for business.


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