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May 2, 2017 | Innovation

Starbucks CEO Howard Schultz is a visionary man. His Starbucks vision has catapulted the company to the exalted position of the world’s No. 1 coffee retailer. Today, there are some 25,572 Starbucks stores worldwide and in 2016 Starbucks registered its highest profits ever, contributing to an 11% leap in annual revenue.

While the success of Starbucks is driven in part by the Time Compression Ubertrend, Schultz has an enviable record of driving relentless innovation, while paying attention to details.

The announcement that Starbucks plans to open the world’s largest Starbucks on Chicago’s Magnificent Mile in 2019 is testament to Schultz’ orthogonal, think different, mindset.

  • Mobile app – Starbucks launched its mobile iPhone app in Spring 2009. An early entrance plus attractive offers like free music and apps, made it hit with consumers. As Mobile Marketer put it, “Starbucks is probably the only app that might make it among the average 26 on a smartphone device, because it is really more of a lifestyle app that customers use daily.”
  • Mobile payment system – Starbucks developed an electronic payment system using QR codes and launched it in January 2011 offering rewards for using the system, which further helped propel the success of its app. Today, more than 21% of transactions at company-owned U.S. stores come through the app.
  • Free Wi-Fi – Another trendsetting feature was the addition of free wireless internet access at Starbucks stores on July 1, 2010, without requiring registration or time limits.
  • Cruise ship store – In October 2010, Starbucks opened its first coffee store on a cruise ship, the Allure of the Seas. In a USA Today story reporting on the opening (now removed), the newspaper ran a reader poll, which found that 63% of article visitors wanted to see more Starbucks stores on cruise ships.
  • Employee benefits – As Fortune reports, “Starbucks was one of the first companies to provide comprehensive health benefits and stock to part-timers. To date, they have realized more than $1 billion worth of financial gains in the form of stock options.”
  • Company size – In March 2015, Starbucks passed Subway to become the No. 2 restaurant chain in U.S. sales — second 
only to McDonald’s.
  • Mobile order and pay – Seeking Alpha reported in April 2015, that “Innovations are the key to Starbuck’s success with initiatives such as ‘Mobile Order & Pay’ exceeding all expectations.” In February 2016, about Starbucks customers placed 7 million orders through mobile devices in U.S. cafés.

The Starbucks case study proves that constant innovation drives success and its contribution to the bottom line is more than $4 billion in estimated profits in 2016.

Starbucks Corp.

Year (of first major innovation): 2009
Innovations: Mobile Apps, Electronic Pay
Innovation Types: Product, Marketing

Michael Tchong

Michael Tchong

Founder, Author, Adjunct Professor, Futurist

Michael Tchong is a distinguished analyst renowned for his expertise in scrutinizing and dissecting societal, cultural, and technological trends. His invaluable insights serve as a cornerstone for guiding businesses and organizations towards more informed decisions regarding their products, services, and innovation strategies.
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