Gabriella Bock: Hello, and welcome back to another episode of the RETHINK Retail Podcast. I’m Gabriella Bock, and I’m here live at Future Stores, Seattle with my guest, John Boline. He is the Vice President of Stores at a little company called Starbucks. You might have heard of them. We are here in Seattle. John Boline: Hometown. Gabriella Bock: The motherland. John Boline: That’s it. Yeah. Thanks for having me. Gabriella Bock: We have our Starbucks drinks on deck, so welcome to the show. John Boline: Thank you. Gabriella Bock: Or welcome back to the show I should say. John Boline: Awesome. I’m glad to be here. Thank you. Gabriella Bock: Absolutely. So, the last time you were on the show was in 2019, I think it was. John Boline: My, how we’ve grown. Gabriella Bock: Yes, and a lot has changed since then. John Boline: Certainly has. Gabriella Bock: So, I wanted to start there, and I know you just were on a panel called the Evolving Role of Brick and Mortar Stores in a Digitally Accelerated World, which we’ve definitely seen a lot of digital acceleration over the last two, two and a half years, so I wanted to start there, and with more people switching to the pickup and the mobile ordering options during the pandemic, I wanted to get your take on how much that has stuck around now that people are returning to the stores, has the consumer behavior shifted? What are you seeing? John Boline: Well, we’re actually seeing it increase even more, so it’s not only stuck around, but it’s continued to increase. I think people fell in love with the convenience and the predictability. We’re at a time in history, which is going to continue to accelerate, where there’s a lot more choice and a lot less time and so mobile digital drive-through gives people channels in which to make their selections, sometimes even 12 hours ahead of when they purchase or when they’re going to come and it makes it convenient and hopefully ready the way you want it, when you want it, and on-the-go. There’s also customers now, post-pandemic, are coming through a different phase of the pandemic where instead of mobile order and pay and grab-an-go, they’ll do mobile order and stay. You might have a friend or a family member, and on the weekend instead of waiting in line or waiting for your product or your beverage to come out, you can game it ahead, and then when you come there, you can actually have that time with your friend and not be focused on your screen or talking to our partner the whole time about what it is you want, so we see it definitely increasing. Gabriella Bock: Absolutely, and so with that, how are you having to rethink store design to cater to a more prominent mobile, or a drive-through model? John Boline: Well, each of those are very different, mobile order and drive-through, they’re different customers. A lot of our drive-through customers tend to be, if you have small children or you have family members that have small children, the transitions of getting out of a car can be quite difficult. Some of those customers also want to order ahead, so we do have mobile order and drive-through, which is something we’re looking at how we can do that. Not easy because a vehicle’s much larger than a human being, so how to stack those and how to get them in and out, so what we’re looking at a number of things there. Mobile order and pay is a very different customer. It’s usually a solo or a double customer, not with children in the car because they don’t want to do that transition, but they see that as a hack in many stores where they can come in the back door and get what they want and quickly get out. Customers order a lot of times 10 minutes ahead, just so that they can game it and that they’re sure that it’s ready when they want to go. We’re doing a lot in the store design to make sure that those channels don’t necessarily cross because when you have one experience versus the other, you want it catered to that facet of your lifestyle. And so I wouldn’t say we have a silver bullet right now, but we’re doing a lot of great things there, and you’ll see some great things in the coming months and years on the future of that experience, and we hope to continue to lead in, and I think we’ve got the right team in place to do that. Gabriella Bock: Fantastic, and you spoke today about how important it is for retailers to really cater to that sense of emotion, to create these emotional connections with their customers. How is Starbucks cultivating those emotional connections with its customers? John Boline: The emotional connection’s interesting, so we did talk a little bit today about the gamut of Starbucks experiences from the roastery up the street here, may have seen in Chicago or New York. Gabriella Bock: Amazing. John Boline: Yeah, like the Disney of coffee, and you get to try origins and flights and different ways to experience the product that you may not have before. That’s a huge emotional connection and value for our brand and for people to come day-to-day. It’s almost a flywheel for some of the other channels to work, and so how do we continue to create those experiences that uplift and get you excited? That are remarkable, and remarkable isn’t just cool, it’s, “Hey, I want to talk about this experience. It was so cool that I want to tell 10 people about it.” And then that’s an idea worth spreading, and that’s something that we’re excited about, and then we do see that same customer come into the convenience format on a Monday, Tuesday, Wednesday that may spend time with us on the weekend or even on a holiday they’re going to seek out that experience. And so, even though they’re very different experiences within our brand, they both very much help meet people where they’re at. Gabriella Bock: Fantastic. I know several years ago, you guys started really focusing on the local stores and the neighborhoods and the communities, so when you’re thinking about design, how do you differentiate the insides of your stores based off of what location you’re in? How would you think about designing a store, let’s say in an area in Miami maybe, versus here in Seattle? John Boline: Localization has always been something that we’ve tried to do in the past. It was artwork and pallets. It still is. That’s important for a customer, but also format, so when you look at a mini market of how the number of Starbucks experiences may be, even in Miami Beach, you’re going to want some that are grab-and-go, go to the beach. You’re going to want some that are cafe, sit-and-stay in a safe, clean, uplifting environment where I can take a break and put my belongings down and have a connection like you and I are having here, so it’s not just the surface anymore. I would say it’s also in providing the meaningful experience that our customers are looking for and making sure that we map out those communities in a way that makes sense to them. And it’s certainly different climate-wise in Miami with outdoor seating and terraces, and some of the great things that the city offers there than it is in the Pacific northwest. People will sit outside here in 30-degree weather under a heat lamp and be content 9, 10 months a year. Seems crazy in Miami but we have slightly different ways of pulling that off, but it’s more of the array of that, and then going into the focus of artwork, materials, finishes that resonate with that local vibe and flavor. Then the third pieces are service, right? You want people of, and from that area that can create that vibe with that community. That you don’t want to come in and have the same experience in a Starbucks in Miami that you had in Seattle. You might want the same product built exactly the same way, hopefully, it is. Hopefully, it could be customized to what… You may have more ice beverages in Miami but the service level that we bring is also super important to localization because if the people are of that community and they’re fostering that excitement, it makes a huge difference. Gabriella Bock: That’s great. So, bringing on a crew that represents the diversity of the location that you’re in. John Boline: They know what music’s playing that night. They know which hotel has the best happy hour. They’re fostering that excitement about being in that place and they want to be in that place, that’s great. Gabriella Bock: That’s fantastic here, and I know you guys have made some big strides in your DE&I initiatives, as well as your sustainable initiatives as well, so how are you incorporating sustainability into your stores? I know you’ve been in quite a bit of it, and what are maybe some things you’ve learned along the way? John Boline: Sustainability is a huge goal. There’s the envelope of the store, and we’ve done a lot of things using solar to offset the amount of power we’re using. We’re looking at water, we do use a lot of water. We brew all of our beverages and Shakearato drinks with water. How can we reduce water waste? And then there’s the consumer side of it, right? There’s a single-use cups, so we’re looking at reusables, and we’ve championed that around a lot of regions on how people can be a part of purchasing a cup one time and getting a credit back in a new cup every time they use it. Difficult for grab-and-go. Nobody’s quite figured that out yet. I would say, folks that have, is where we have like a closed campus where some of our licensed stores are. Their entire operation will run actually at our support center at the Starbucks headquarters, just down the road from here. We have reusable cups throughout the building, so when I do a mobile order there, at the end of it there’s a machine, and I scan the QR code. Put it in there… Gabriella Bock: Oh, very cool. John Boline: … And then the next time I come, there’s a fresh cup waiting for me. Gabriella Bock: Oh, brilliant. John Boline: In a closed campus, it makes sense. A little bit harder in the drive-through and things like that, but we’re definitely going to go after it and figure that out over the next few years. Gabriella Bock: Very cool. I love to hear that. John Boline: And get the consumer involved, right? Gabriella Bock: Yeah. John Boline: That’s the key, getting the consumer excited and involved in that. Gabriella Bock: Very cool. And then one last question for you, so your CEO, Howard Schultz, recently made a statement saying that we need to reinvent the Starbucks of the future. So, John Boline, what do you envision as the Starbucks of the future when it comes to design? John Boline: The Starbucks of the future has to keep our people safe. We talked about that a bit today. It has to be a safe environment to work in. After the safety’s taken care of, it has to be completely uplifting. It has to have room for new product and service levels that surprise and delight in ways that you probably haven’t experienced yet, and by evolving that we keep remarkable again. We keep as a company that you want to talk about when there’s some little differentiation. We’ve tried things with curbside. We’re enhancing mobile order pay. We have a concierge that actually is dedicated to you in the mobile order experience, those kind of things that we want to continue making that connection that make you feel good about Starbucks. Knowing that we’re doing all the environmental things and behind the scenes that we’re also catering it just for you, for that one moment that can uplift you, and hopefully differentiate from other companies serving from. Gabriella Bock: Fantastic. Well, thank you so much for popping by the show. I know I am certainly a fan and you guys have kept me happy. John Boline: That’s good. Thank you for your loyalty. We appreciate all of the coffee you drink with us, and hopefully we’re uplifting you each time you get your beverages, right. Gabriella Bock: Thank you very much. John Boline: All right. Thank you.
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