American Starbucks wants to grow the next few years through its tea subsidiary Teavana and through expansion in China and India, according to CEO Howard Schultz's remarks during the annual shareholders meeting.
100 billion dollars market value
Starbucks has more than 20,000 stores and over 200,000 employees in 64 countries and gets some 70 million customers per week. The Seattle-based group has ended its fiscal year 2013 with a record turnover of 14.9 billion dollars (10.8 billion euro, + 12 %) and a 2.5 billion dollars (1.8 billion euro, + 23 %) net profit.
CEO Howard Schultz is planning to keep this pace going, which he made very clear during the annual shareholders meeting in Seattle: "We are heading towards and past a 100 billion dollars market cap", he said of a company that is currently valued at 57 billion dollars (41 billion euro).
Apps and loyalty program
Schultz has Chinese and Indian expansion in mind to achieve this ambitious goal, but he also has to halt the slowing growth in the American market. That is why it is building new apps, to allow customers to order even when they're not even in the Starbucks store yet.
Adam Brotman, Starbuck's chief digital officer, is also fully backing the Starbucks Card and the My Starbucks Rewards loyalty program, which makes sense as a quarter of all transactions comes from these customers. In the United States alone, there are over 8 million customers in these loyalty programs.
Tea category "ripe for innovation"
Starbucks is also looking for expansion in other markets than coffee, with strong growth envisioned in the tea branch which is currently worth some 60 billion euro worldwide and "ripe for innovation", according to Schultz. It had bought Teavana a year ago and it wishes to "do for tea what Starbucks did for coffee", by turning it into an experience.
The company has already opened nearly 40 new Teavana stores (mostly in shopping centres) since it had acquired the brand, with another 20 planned for 2014. Shareholders were also told that the redesigned Teavana Fine Teas (strictly sales) and Tea Bar (local consumption) will be rolled out in Chicago, Los Angeles and New York City.