Starbucks’ Niccol aims to tame the chain’s mobile order floods

By Juveria Tabassum and Waylon Cunningham

(Reuters) – Starbucks’ new CEO Brian Niccol has a vision of making Starbucks a classic coffee house, but he has to struggle with an unusual challenge: The company’s mobile orders are as disturbing as they are popular.

“They come in faster than our customer can get there,” Niccol said in a call with investors on Tuesday. He said that Baristas’ haste with pile these orders on the counter comes at the expense of giving a more personal touch to customers in the store.

Niccol called Mobile Order as a bottleneck five times during the call and said the company-on Tuesday, issued a less than expected fall in comparable sales-ville work against sequencing mobile orders using an algorithm to improve efficiency behind the counter.

In some ways, Starbucks’ abundance of mobile orders have presented an opposite problem for what Niccol was facing six years ago when he was the CEO of the Mexican restaurant chain Chipotle as he monitored the launch of a mobile app and reviewer dedicated to orders From that app called chipotlanes.

Niccol told investors in October 2018 that he thought less than half of Chipotle’s customers knew they could order through digital channels. “We have to improve it dramatically,” he said at the time.

Starbucks introduced mobile ordering in 2015 and customers quickly took advantage of it.

Mobile orders took precedence for Starbucks under Niccol’s predecessor Laxman Narasimhan as the company focused on driving traffic through its reward program members who tapped on offer and discounts on the app.

In contrast, comfortable seating, ceramic mugs and baristas with sharpnesses and personalized messages on coffee cups have been at the center of Niccol’s attempt to take Starbucks back to its roots, and the congestion of mobile orders contradicts this strategy.

The company is piloting a priority algorithm in the store to sequenced mobile orders away from the current first-come, first-served, Niccol said, awarded compensation of almost $ 96 million in 2024, a year in which he took up Starbucks as CEO in September. The salary package made Niccol one of the highest paid leaders in Corporate America.

“I was in one of our stores this morning, where we have already started putting this algorithm in,” Niccol said. “It happens behind the scenes and it smooths these speeds of mobile orders so that our teams are able to give good moments of connection to in-cafe customer and mobile order customer.”

(Reporting Juveria Tabassum in Bengaluru and Waylon Cunningham in New York; Editing Leslie Adler)