digital orders

As if it weren’t to-go-friendly enough, coffee behemoth Starbucks announced this week it is speeding up the reformatting of many of its stores to cater to more off-premises orders. Yes, the move is in response to the impact COVID-19 has had on the restaurant industry. It’s also part of Starbucks’ ongoing “Bridge to the Future” reopening plan, which CEO Kevin Johnson outlined in a letter yesterday.

A huge part of that plan is to accelerate the pace of development for what Starbucks calls its “third place” — that is, stores that cater heavily to on-the-go customers and off-premises orders. That includes drive-thru locations, Starbucks Pickup stores, and more recent formats, such as curbside pickup.

Starbucks, which claims 80 percent of its orders before the pandemic were already “on the go,” had already been moving in this direction. But as Johnson suggested in his letter this week, the pandemic has changed consumer behaviors and habits and made many folks more amenable to off-premises formats and less excited about sitting down in brick-and-mortar locations. In keeping with that, Starbucks’ plans to transition its store formats “over a three- to five-year period will now occur over the next 12 to 18 months.”

That will include building out more drive-thrus, creating more pickup locations in dense urban areas, and relocating low-performing stores (e.g., those in malls) to locations where they can have a drive thru. Johnson added in his letter that customers will “soon see more curbside pickup options as well as delivery – all formats optimized for the current crisis and a future of changing consumer expectations for the third place across the U.S.”

This emphasis on the so-called third space isn’t unique to Starbucks, although no other restaurant chain out there is pursuing it quite as aggressively. Probably because few restaurant brands have as much money or reach as Starbucks, who said this week it has now regained roughly 60 to 65 percent of prior year comparable U.S. store sales, according to Johnson.

Other brands may be able to incorporate some of these “third place” initiatives into their own operations. Buffalo Wild Wings just launched its first to-go-only concept store in Atlanta, GA, while Shake Shack unveiled its own off-premises concept earlier this month.

More interesting, though, are what smaller chains are up to. For instance, Austin, TX-based chain Torchy’s Tacos has been retrofitting existing drive-thru windows at its stores and creating on-the-fly curbside pickup at other locations. When we spoke back in April, the brand’s Chief Marketing Officer, Scott Hudler, said the company had “MacGyver’d” a bunch of technologies together to run these off-premises operations smoothly. So far it seems to be working. 

Few will be able to accomplish a total overhaul of their store formats a la Starbucks. But plucking one or two elements for the coffee giant’s playbook, at least when it comes to making to-go orders more efficient, could make all the difference as the entire restaurant industry moves closer to that third place.