OK, this hits right at home since we at FintekNews are at our Starbucks six mornings a week. And, let’s be clear, “order ahead” really means cutting in line or line jumping. NOT COOL. So, Starbucks has a huge problem that they created and there may be no fix for. This is an example of technology gone bad. Or, as Cramer says, Starbucks now has a mosh pit in the pick-up area.

Mobile ordering at Starbucks (and other fast serve places) saw that customers would love to skip in front of others in line and get their coffee (and stuff) quickly and save time. Well, it got TOO popular and created unforeseen problems. Crowded stores, angry customers, slower service and some loss of business. Thoughts on how to fix these issues are still going on but the benefits envisioned with the new technology may wind up costing more than Starbucks (and others) more than the savings. Great read and as a Starbucks loyal customer…………FIX IT!

(Bill Taylor/CEO)

"For some time now, restaurant chains have been adding mobile order-ahead options, betting they’d be popular with their customers. But even they were caught off guard with just how big of a hit the technology is turning out to be.TGI Friday’s Inc. mixed up orders, and Starbucks Corp. struggled with overcrowding that scared off regular walk-in-and-pay customers. And that’s likely just the beginning for a technology that’s only now really starting to catch on. Researcher Crone Consulting LLC estimates that in five years half of all sales at quick-service chains will be placed digitally before the customer ever steps on the premises. Today, less than 10 percent of the companies even offer the mobile order-ahead feature.

So swift is the growth of the technology that chains are having to rethink the way they do business, from putting a guy at the front door to greet customers to adding extra grab-and-go parking spaces. Pizza Hut Inc. is retooling its app to include order histories and suggest popular sizes to speed up the process. Fast-food chain Chick-fil-A Inc. already delivers orders curbside at about a third of its locations, and is studying whether to let customers grab their grub using drive-through lanes. Even mom-and-pop joints are jumping in: Eastman Egg Co., which runs three sandwich shops in Chicago and saw its monthly order-head sales rise 180 percent in December from a year earlier, is installing separate pick-up stations for mobile orders......

Starbucks, an early pioneer of the technology, figured out the downside of not being prepared after it introduced the feature nationwide in late 2015. Order-ahead customers flooded some stores, making it look like lines were extra long. Last quarter, mobile orders represented at least 20 percent of sales during peak traffic times at nearly 1,200 Starbucks stores. A year ago, only 13 of the company’s coffeehouses could make that claim. Order-ahead apps drove 7 percent of all transactions last quarter, double the figure a year earlier.

As walk-in customers look at the number of people hovering around the counter, it “might create a signal to them that they are going to wait to do their transaction,” Kevin Johnson, who will take over as Starbucks CEO in April, said on the company’s quarterly earnings call on Jan. 26. “We’re now laser-focused on fixing this problem,” outgoing CEO Howard Schultz added.

The coffee chain’s fixes include adding text-message notifications to alert customers when a mobile order is ready and hiring more baristas to smooth out congestion...."

Read Full Article at Bloomberg