As you know I’ve been following Starbucks and their 15th Ave experiment, and it looks like the gamble has paid off.
According to the NY Times:
- Starbucks’ net income was $241.5 million up from $64.3 million in the first quarter last year
- Revenue climbed 4 percent to $2.7 billion
- Same-store sales were up 4 percent
- The company’s stock has nearly tripled to $23.29
But I’m not telling you this just to report Starbucks’ good news. What I wanted to point out was this interesting paragraph from the Times’ story:
Mr. Schultz brought Cliff Burrows, who was managing stores abroad, back to Seattle to run American operations. One of the first discoveries he made talking to customers seemed basic, but had been lost in Starbucks’ push to open stores.
Burrows goes on to say that by talking to customers Starbucks was learning how customer preferences varied by geography allowing Starbucks to better meet customer needs/desires.
What I love about this turnaround is that it nicely exemplifies how focusing on customer experience, listening to what customers want, and fulfilling their needs can directly effect your bottom line. Shultz and Starbucks are re-learning what the 460+ leaders in our groundbreaking research helped us prove some time ago: that customer experience is not a tradeoff to profits; it is the pathway to stronger financial performance.
