Starbucks’ Open Bathroom Policy Comes With Heavy Cost, Study Finds

Pedestrians walk by the Hollywood Starbucks Coffee shop in...

Some 18 months after a racial incident in Philadelphia led Starbucks to institute an official policy to open its U.S. coffeehouses and bathrooms to anyone, regardless of whether they make a purchase, a study finds the Seattle giant may be paying a big price for its pledge to be a third place for all people.

Monthly visits to Starbucks dropped 6.8% compared with other nearby coffee shops after the open-bathroom policy was put in place in May 2018, according to a joint study released Tuesday by academics from the business schools at the University of Texas at Dallas and Boston College. The study, conducted in collaboration with the data company SafeGraph, examines aggregate and anonymous cellphone location data from more than 10 million devices between January 2017 and October 2018.

It covers nearly 10,800 U.S. Starbucks locations and measures them against other cafes and restaurants nearby.

“The decline in visits to Starbucks is large and significant,” the 43-page report says.

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Starbucks disagreed with the finding. “As evidenced by our earnings reports, customers are visiting us in record numbers,” spokesman Reggie Borges said. “The study focuses on cell phone user data. What we are seeing is real customers.”

U.S. comparable store sales in the fiscal year through Sept. 29 jumped 5%, including a 3% increase in average spending and a 2% gain in the number of comparable transactions that indicate traffic, Starbucks said in October. Q4 U.S. comparable sales rose 6%, the best performance in over two years. CEO Kevin Johnson said at the time Starbucks continues to see “traffic growth across all dayparts.”

With the free bathroom access, the researchers looked at the proximity of a given Starbucks store to a homeless shelter and found that customer traffic declined at almost double the rate at stores closest to homeless shelters versus those farthest away. The researchers also found fewer citations for public urination in nearby Starbucks locations as a result of its policy change.

Customer traffic wasn’t the only thing that was hurt. The average income of Starbucks’ customers has dropped compared with the average income of other nearby coffee shops, thanks to fewer visits from “its wealthier clientele.” “This would be consistent with them being more sensitive to crowding and the new visitors brought in by the bathroom policy,” the paper says.

Meanwhile, customers who visit its stores spend on average 4.2% less time in Starbucks compared with other coffee shops following the institution of the official policy, according to the research. The decline is also bigger at locations closest to homeless shelters.

“The small number of non-paying visitors who do linger and use tables and bathrooms have an outsized effect on the total number of visitors, who either stop coming and/or spend less time in the store,” the study says. “It’s unlikely that moving from the quasi-public bathroom policy to a completely open public bathroom has benefited Starbucks unless the customers increased their purchase significantly. … None of this considers any extra staffing costs involved in greater bathroom maintenance.”

Read what Starbucks employees have told me about the open bathroom policy.

While Starbucks’ latest results suggest it can withstand any potential negative impact from its bathroom policy, the study highlights the dilemma public companies like Starbucks face: how to engage in “socially responsible” activities that may not align with shareholder interests.

It’s not “clear whether provision of public goods leads to increased shareholder wealth,” the paper says. “At a certain point, stores must decide how much to curtail the provision of the good to non-patrons, who may also actively deter others’ purchases. … The negative consequences of Starbucks policy suggest that profit-maximizing companies will be likely to underprovide exactly for those groups who have the lowest willingness to pay.”

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Source: Starbucks’ Open Bathroom Policy Comes With Heavy Cost, Study Finds

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Will the open-to-all bathroom policy backfire? ‘The Greg Gutfeld Show’ weighs in. FOX News Channel (FNC) is a 24-hour all-encompassing news service dedicated to delivering breaking news as well as political and business news. The number one network in cable, FNC has been the most watched television news channel for more than 15 years and according to a Suffolk University/USA Today poll, is the most trusted television news source in the country. Owned by 21st Century Fox, FNC is available in more than 90 million homes and dominates the cable news landscape, routinely notching the top ten programs in the genre. Subscribe to Fox News! Watch more Fox News Video: Watch Fox News Channel Live: Watch full episodes of your favorite shows The Five:… Special Report with Bret Baier:… The Story with Martha Maccallum:… Tucker Carlson Tonight… Hannity… The Ingraham Angle:… Fox News @ Night:… Follow Fox News on Facebook: Follow Fox News on Twitter: Follow Fox News on Instagram: Subscribe to Fox News! Watch more Fox News Video: Watch Fox News Channel Live: Watch full episodes of your favorite shows The Five :… Special Report with Bret Baier:… The Story with Martha Maccallum:… Tucker Carlson Tonight… Hannity… The Ingraham Angle:… Fox News @ Night:… Follow Fox News on Facebook: Follow Fox News on Twitter: Follow Fox News on Instagram:


Remember The Changes To Starbucks Rewards? It Turns Out People Like Them

Last April, Starbucks made some significant changes to its Rewards program.Rather than requiring customers to wait until they acquired enough stars for a food or beverage item, it introduced a tiered system, with a variety of rewards at different levels of stars.

That offered more opportunities for freebies. But if you didn’t know to cash in your 125 stars for a free drink before the program changed, you might not have been happy to wake up and find that you now needed 150 stars.

Fast forward six months, and it turns out that the new Rewards system is working out pretty well. On a conference call with analysts last week, Starbucks said that membership in the Rewards program is up about 15 percent compared with 2018.

The program now has 17.5 million members, versus 16 million at the beginning of 2019. Starbucks, which rolled out the program in 2009, has updated it three times since then, earning this version the nickname Starbucks Rewards 4.0.

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In reality, Starbucks chief financial officer Rosalind Brewer said most Rewards members are redeeming 150 stars for a hand-crafted coffee drink. But now that different levels of rewards are available, the company is seeing more activity by occasional customers, and more activity throughout the day, as well as during peak morning hours.

These customers seem more interested in Starbucks’ beverages, and less interested in its food offerings. Brewer said the company’s cold drinks, including refreshers, iced teas, cold coffee drinks and nitro cold brew all are performing well.

“We are pleased that we did add the other layers of redemption, just so that we can expand the excitement of the Starbucks brand to a broader customer,” she said. That’s a promising development as Starbucks prepares to open its newest type of store on Tuesday near New York City’s Penn Station.

It’s called Starbucks Pickup, and it will cater solely to customers who order their drinks via its mobile app. The process is modeled after Starbucks Now, which has become a big company push in China, where Starbucks is bent on expanding its business. In order to use the store, customers must download the Starbucks mobile app, if they don’t already have it. Then, they will select Pickup-Penn Plaza as the location, and place their order.

Once they arrive at the store, Starbucks says they will find their drink via an order status board. Baristas will be there to help if needed, but they are primarily there to make drinks as orders come in on the app. It recommends that customers designate the Pickup-Penn Plaza location as a favorite, in order to save time with their next order.

The first Starbucks Now store opened in Beijing in July, and Starbucks says it plans to expand the concept to other big cities there in the coming year. Collecting that digital information on its customers is crucial to Starbucks, which plans to open 2,000 more stores in the coming year, with half in the U.S. and China. It now has 31,000 stores world wide.

“From the point of the digital relationships, the more we learn about our customer base, the better we (have) been marketing to them,” Brewer said.“And so you will see our marketing become more personalized and that will help with retention and driving frequency in our stores.”

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Source: Remember The Changes To Starbucks Rewards? It Turns Out People Like Them

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Here is a description of the changes in Starbucks Rewards program for April 2019. What is changing, what you need to know and what you need to do with your current rewards stars. Let us know what you think and what you use your Starbucks Rewards Stars on in the comments below. Our Social Media

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