Starbucks sales continue to outpace the quick-service industry; in its fiscal third quarter, the coffee giant saw global comparable sales increase by 4 percent, even as overall restaurant sales growth softened. But the company’s growth would scarcely be possible had the company not made gigantic strides at the drive thru in recent years.
Yes, Starbucks has now clearly emerged as an innovator in the drive thru, lauded for new mobile payment and ordering systems, as well as bringing its distinctive in-store experience to the drive thru. For a company that has been praised virtually since its inception, this may come as no surprise. But five years ago, Starbucks’ drive thrus were nothing special by the company’s own admission—not even on par with other drive-thru concepts. The story of its rise to industry leadership includes adopting a new way of looking at the business through individual customer zones, several “aha” moments, and a commitment to developing solutions based on customer needs and behaviors.
Early on, Starbucks’ customers told the company they wanted a drive-thru option. But several years ago, Starbucks’ drive thrus had “hit a wall.” They lacked differentiation; communications were limited to menuboards. The brand was nowhere near best in class. The vision was to find ways to think differently about the drive thru. What could be done to speed throughput, increase transactions, provide better service, and grow ticket? What could be done to make the Starbucks’ drive-thru experience dazzle its customers? Where to start?
The answers to these questions show a company willing to change in order to generate continuous improvement.
Initial audit leads to customer operating zones
Starbucks asked King-Casey to evaluate its drive thru and make recommendations. The first step was for King-Casey to do an audit of drive thrus in the Seattle area, looking at Starbucks’ operations through the lens of the customer. A small team of Starbucks executives accompanied King-Casey, and they found the results eye opening, to say the least. By the third site visit, the Starbucks team was driving the audit, pointing out how little consideration was being given to the customer at the drive thru; at one point, one of the members said, “There aren’t even any signs to mark where the drive thru is.” The audit provided the first “aha” moment for Starbucks: the drive thru was something more than just an order point.
COZI then enabled Starbucks to home in on the solutions. The acronym stands for Customer Operating Zone Improvement, and it is a methodology pioneered by King-Casey. Starbucks cafes are not just branded boxes. Rather, each store is a collection of many individual “customer operating zones,” and customers behave differently in each one. Their needs and expectations are different. Their attitudes and mindsets are different. Each of these unique zones is right for one merchandising strategy and dead wrong for another.
COZI is applicable both inside a restaurant and at the drive thru. In this case, Starbucks needed to identify each of the drive-thru zones, such as approach, entry, pre-order, order, pickup and pay, and exit zone. The company needed to understand how customers behave in each zone, what their needs are, and establish specific business goals for each zone.
The COZI methodology was introduced to Starbucks at two half-day management workshops, each attended by 20–30 executives, a combination of senior officers and line managers. These “roll up your sleeves” sessions built on the enthusiasm for the audit results and an understanding of the possibilities for significant growth, as well as the need to change internal culture. As a result, Starbucks made the requisite time and resource commitments for a new drive-thru experience.
Recognizing customer zones was a breakthrough moment for Starbucks. Instead of thinking about the drive thru as a whole, Starbucks started thinking about the different and distinct customer zones. Being able to dissect the drive thru into key customer operating zones helped Starbucks think through many different improvement opportunities. New zone-specific strategies were developed for the different customer zones. Messages were now cognizant of customer needs, attitudes, and behaviors, and were tailored to meet specific, zone-appropriate business objectives.
These changes alone made a big difference in sales performance and customer satisfaction that exceeded expectations. But Starbucks didn’t stop once it nailed zone-specific messaging. The team asked King-Casey to return to evaluate their progress. We pointed out that they had definitely made significant evolutionary improvements and could now be considered equal to best in class in the drive thru. King-Casey also challenged the company to continue to make revolutionary changes that would vault it to world-class leaders. To its credit, Starbucks accepted the challenge—and met it.