Starbucks Corp. (NASDAQ: SBUX | SBUX Price Prediction) recently said that it would launch a secret AI barista. What isn’t clear is why that’s a secret. Fortune picked up CEO Brian Niccol’s comments. He said Starbucks is well underway in launching an artificial intelligence project. The results, Niccol added, will be a system to help store staff predict in “real time” what customers order. This will specifically apply to people who order their items in advance. It won’t help. All of Niccol’s other schemes have done little or nothing to improve results, and this should be proven when it releases numbers for its most recent quarter.
Niccol is still fighting a share price that is down 10% over the past year, while the S&P 500 is 18% higher. Niccol started his job last September, so the entire drop has come on his watch.
Niccol has come up with several other tactics to turn around the company. He limited what baristas may wear. He has said he wants to turn Starbucks stores into local cafes and community gathering places. He has fired over 1,000 managers. More recently, he has closed several hundred stores, which has angered some Starbucks landlords. Few new CEOs have grasped at straws so rapidly.
Starbucks’s success, or lack thereof, is defined by same-store sales and how much customers spend per visit. Among the complaints customers had was long wait times. There is no solid evidence that this has improved in the United States. Occasionally, Starbucks stores do not open on time. They also run out of food. These issues would seem simple to fix, but they persist.
Starbucks has tremendous competition. As coffee prices have risen, some people prepare their coffee at home. Others go to major fast-food chains like McDonald’s and Dunkin’ Donuts. Starbucks still has to come up with reasons people should visit their stores.
Even if Starbucks has machines that can help reduce wait times, it still has to fix half a dozen other problems.
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