Locator: 48455SBUX.
Updates
Later, 7:49 p.m. CDT: I was wrong -- CNBC thinks Starbucks' big problem is its mobile app, link here:
Original Post
Starbucks. New CEO. Two things to watch:
- how the new CEO cuts costs to increase earnings to excite investors:
- close under-performing stores quickly; surely there must be many;
- take a lesson from GE's Jack Welch's "cut 10%" policy (stores, not baristas)
- close "uncomfortable" stores (high crime areas); symbolic but will appeal to investors;
- how the new CEO changes the product to excite customers; the product?
- price: perceived as high-price option; coffee and a bagel costs as much as a Chipotle burrito; prices have to come down, but I just don't see it; will probably market "value" for price, maybe offer more specials at slow times of the day.
- service: perceived as slow (with which I disagree)
- is there an opportunity for self-serve for simple black coffee like most other places?
- fare: perceived as bland, little change in ten years
- could they add smoothies during the summer? I honestly don't know.
- loyalty rewards: perceived as really, really chintzy (with which I agree)
- give local baristas more latitude in rewarding daily visitors, especially those who actually spend time in the restaurant; offer a free refill and see if a customer might be ready for another snack (at cost)
- seriously, how much revenue is lost when a barista offers a free refill on a tall black coffee;
- the app: seems okay to me
This will be absolutely fascinating; a new CEO is generally given a year to make his/her mark.
Where to watch the new CEO's successes / failures? On Cramer's Mad Money.
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.