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Howard Schultz
Howard Schultz

If there was any doubt that Starbucks CEO Howard Schultz sees his coffee retailer as a tech company, that was put to rest today in the company’s third quarter earnings call.

Schultz spent nearly all of this time discussing many of the retailer’s digital initiatives, including the retailer’s ambitious order-ahead service which is expanding to all company-owned stores in the U.S. this holiday season.

Schultz said that Starbucks sits in an unique position given its early investments in digital initiatives, which began about three years ago under the direction of Chief Digital Officer Adam Brotman.

“We have to keep pushing innovation inside and outside of our stores, and we have to be as relevant for our customers on their phone, as we are inside the Starbucks experience,” said Schultz. “And I think that is exactly what we are doing.”

Schultz said that the company’s digital efforts are paramount, representing a very “big idea.”

Here’s how Schultz kicked off the call:

“Two years ago, I reported on the seismic shift in consumer behavior that would significantly impact traditional bricks-and-mortar retailers. I was not clairvoyant. The coming change was apparent. Since then, many traditional retailers and consumer brands have responded simply by substantially increasing their digital advertising budgets, significantly driving up their cost of customer acquisition and producing little to show for it.

We, on the other hand, took a very different approach. By further enhancing our already world-class digital technologies, through the introduction of capabilities like Mobile Order & Pay and soon-to-be delivery, and expanding our loyalty program, we are driving traffic as reflected in the 4 percent growth in traffic in Q3 — bringing in new customers and deepening our connections to our existing customers, elevating the Starbucks brand and our customer experience, and streamlining our in-store operations.

At the same time today, you will hear about unique digital partnerships that we are forging with like-minded businesses in a number of verticals that will further leverage the Starbucks brand and our digital assets in order to further reduce our already low cost of customer acquisition and drive additional incremental traffic.”

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