Starbucks opened its Pickup store in Manhattan late last year. (GeekWire Photo / Taylor Soper)

Get ready for more Starbucks Pickup stores.

The Seattle coffee giant is speeding up plans to roll out its new store concept designed for customers who order ahead with the Starbucks app.

Starbucks has been testing the strategy at two Starbucks Pickup stores in Manhattan and Toronto over the past seven months. But CEO Kevin Johnson revealed today that the company is moving faster with its expansion strategy due to the COVID-19 pandemic.

“While we had originally planned to execute this strategy over a three- to five-year timeframe, rapidly evolving customer preferences hasten the need for this concept and we are now envisioning the accelerated development of Starbucks Pickup stores in major U.S. cities over the next 18 months, including retrofitting and repositioning many existing cafés to expand our store portfolio with a mix of appropriate store formats,” Johnson wrote in a business update for investors.

Johnson said the company is now assessing its stores “with respect to renovations, relocations and closures” to adjust for the change in plans. Starbucks will reduce its new store opening plan and close up to 400 company-operated stores over the next 18 months “in conjunction with the opening, over time, of a greater number of new, repositioned stores in different locations and with innovative store formats.”

GeekWire tested the Starbucks Pickup experience this past December in New York City. Customers order items with the app, get an estimated wait time, then pick up their food or drink inside a small location.

Starbucks opened its Pickup store in Manhattan late last year. (GeekWire Photo / Taylor Soper)

Starbucks debuted its mobile order-ahead app feature (also known as Mobile Order & Pay) in late 2014 and it quickly caught on with Starbucks Rewards members — so much so that the innovation created a congestion problem inside stores.

Starbucks responded with dedicated stations for mobile order-ahead customers, distinct from existing in-store registers. The company also began using a new “Digital Order Manager”; reallocated employee roles; and reimagined its store designs with mobile orders in mind.

The Starbucks Pickup concept is the latest evolution of the order-ahead idea. In 2017, Starbucks piloted a version of the Pickup concept for employees at its Seattle headquarters. And this past July the company opened its first Starbucks Now store in Beijing that focuses on mobile orders and delivery.

Pickup lets Starbucks save expenses on real estate and labor while catering to a significant chunk of its customer base, as more and more people get comfortable with ordering via smartphone.

The stores could also become a hub for delivery orders, much like Starbucks is doing in Beijing with Starbucks Now.

Now with the need for physical distancing, Starbucks is doubling down on Pickup as it navigates the global health and economic crisis. Here’s more from Johnson’s note to investors:

“Our vision is that each large city in the U.S. will ultimately have a mix of traditional Starbucks cafés and Starbucks Pickup locations. With Starbucks Pickup stores located within walking distance of a traditional Starbucks café, customers can choose to enjoy their Starbucks Experience in a Starbucks café or pick up their order at either that café or a nearby Starbucks Pickup store. Starbucks Pickup stores will provide more points of presence to better serve “on-the-go” customers while reducing crowding in our cafés, thereby improving the “sit-and-stay” experience for “third place” occasions. No matter the format, we know that the Starbucks “third place” experience occurs from the moment a customer envisions their daily Starbucks Experience to wherever they enjoy that Starbucks beverage.”

Starbucks, which closed stores across the U.S. and Canada amid the COVID-19 outbreak, began reopening in early May and expects to have 90% of company-operated U.S. stores back in business this month “with enhanced safety protocols and modified schedules.”

Starbucks said today it expects revenue to decline between $3 billion to $3.2 billion in the current quarter due to the pandemic. Shares were down more than 4% Wednesday but have risen steadily since a March dip.

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