A few weeks ago, we were in New York City. We had about an hour to kill and needed to spend time on our laptop before an appointment. And so, like many people, we looked for a Starbucks.
We could not find a seat. We visited one location. All the seats were taken. We used our app to find another location. No seats there. It was only when we got to a location inside an office building lobby that we were able to sit down, but that 30-minute game of Find a Seat in a Starbucks wasn’t all that pleasant.
We were therefore not surprised to hear from the company that it pulled out some 30,000 seats from its stores, largely since the pandemic. Nor were we surprised that it is now putting those seats back, because there is demand for them, enough that the chain can quantify just how much a single seat makes.
It’s the latest lesson from Starbucks. The chain went too far in its bid to cater to the takeout customer, and in the process abandoned what made the brand Starbucks.
The coffee shop giant is hardly alone in this.
Restaurant chains spent much of their time after the pandemic adjusting to what they saw as a new normal. As consumers shifted so much of their visits to takeout and delivery, companies stopped focusing on in-store customers and instead worked to push takeout, delivery and drive-thrus.
There’s certainly plenty of evidence to suggest that this was the right move. After all, consumers are taking their food to-go in nearly three-quarters of visits, according to the National Restaurant Association. That’s up from two-thrids before the pandemic.
The post-pandemic world has also brought us a new generation of chains—mostly beverage-focused brands—that don’t have seats at all.
Given the expense of opening a restaurant, and the need for brands to generate a return on their new locations, it made sense to shrink boxes and devote energy toward where consumers were visiting the most. Why install a nice seat when customers won’t use it?
In Starbucks’ case, focusing more on that takeout customer was a financially rewarding decision.
The brand’s drive-thrus generated long lines. It boasted one of the best mobile ordering apps in the business. Most of its sales came from members of the chain’s loyalty program. There is only so much business a coffee shop chain can get from customers who spend an hour checking email on their way to a meeting.
But consumers still need the service restaurants provide. They yearn for connection, a phrase we heard probably thousands of times during the Starbucks Leadership Experience event this week.
Consumers may not always use the in-store services, but they want them to be there. Or, in the terms of Starbucks CEO Brian Niccol, “when they pick up their mobile order, they’re going to pick it up in the world’s best coffeehouse.”
McDonald’s and its franchisees before the pandemic remodeled much of the chain’s interiors, even though we knew at the time that the brand catered mostly to drive-thru customers. That remodel has remained a competitive advantage for the chain. Consumers want to visit restaurants they feel good about.
In focusing so much on takeout, restaurant chains have forgotten what they were created to be in the first place. They became food factories, intent on getting people their food and moving them on.
But we’ve seen time and again lately, in the success of brands like Chili’s and Texas Roadhouse, that customers will pay for good experiences. And even these drive-thru-only concepts like Dutch Bros are built on the service they’re providing.
A restaurant visit isn’t just about getting a meal or a beverage. It’s about giving yourself that one special moment during the day, even if that moment is brief. Brands shouldn’t forget that, because consumers haven’t.