Want an NFT with a Starbucks latte? The coffee giant this week announced plans to enter the Web3 space with the launch of its own NFT collection later this year, where selected digital collectibles also grant their owners access to exclusive content and other benefits.
The company spoke about its plans to investors at its Fiscal 2nd Quarter 2022 earnings call explaining how NFTs can help Starbucks expand its brand concept of the “third place”—that is, a place between home and work where people can feel connected over coffee.
“New technologies related to Web3, and especially NFT, now support that drive and allow us to expand on what Starbucks has always been at our core,” Starbucks chief marketing officer Brady Brewer told investors. “We are creating a digital third place. To do this, we will expand our concept of what it means for people to be members of the Starbucks community, adding new concepts such as community-based ownership and membership models that we see evolving in the Web3 space,” he added.
The company said it will build its NFT community on an “environmentally sustainable” Web3 platform, a solution it says will be more in line with its existing sustainability commitments. However, the company did not specify which blockchain technology will be powered by its NFT collections, but said it would likely be “multi-chain” or “network independent.”
While Starbucks didn’t elaborate on what its debut set of NFTs would look like, who would develop them, or what membership features they would provide, it did explain. in the next blog post he sees the potential to create a growing business near his stores, where digital collectibles are not just bought and sold in a speculative fashion, but are effectively doubled as an access pass giving shoppers special experiences and privileges.
“We plan to start with our first collection of NFTs, memberships and community later this year based on coffee art and storytelling. It will bring many unique experiences and benefits worthy of the Starbucks Genesis NFT collection. This collection will then serve as the basis for future collections and collaboration within the Web3 community, the company said.
While some companies are launching NFT without thinking about how the technology fits into their larger business plans, Starbucks seems to be taking a different approach. He brought in Adam Brotman, the architect of Mobile Order & Pay and the Starbucks app, to help as a special advisor on the project.
Notably, the company is also looking for a new CEO who understands the potential of these new technologies, current acting CEO Howard Schultz said. From a longtime performer back at the head of a chain of coffee shops – Now subjected to union pressure – after the departure of Kevin Johnson, who has served as CEO since 2017.
In addition to a deep understanding of the Starbucks brand and global experience, he said, the new CEO should have an understanding of Web3 technologies as they can help Starbucks communicate better with young people. NFTs can also provide a way to generate additional traffic and revenue, not only in terms of retail, but also additional revenue from your own business, the CEO added.
“I think the next CEO will be a creative person who understands that Starbucks brand equity has real legitimacy and relevance outside of our stores. And in the world we live in today, our customer base is getting younger, they are digital natives and they expect Starbucks to be as relevant outside of our stores as we are inside,” Schultz explained. “… The new CEO obviously needs to have the understanding, the understanding and the conviction that we can play multiple theaters that can be rewarding in their own right and complement our retail business,” he said.
Investors did not ask many questions related to the new Starbucks NFT venture, instead focusing on learning more about the impact of the labor movement on Starbucks’ business, the suspension of share buybacks, and the situation in China, among other things.
It’s no surprise that Starbucks is willing to experiment in the NFT space, given that the company has proven to be a leader when it comes to adopting new technologies. Its mobile payment system, for example, helped promote the idea using your phone to pay for orders long before Apple Pay and other NFC-based touch payment methods were widely available. Today, Mobile Order & Pay is a $4 billion+ business, Starbucks says, up 400% in five years and up 20% over last year. Starbucks said it is working on implementing improved digital tips so that customers can tip even if they didn’t pay with a Starbucks card.
The coffee giant beat expectations for second-quarter revenue. from $7.64 billion vs. expected $7.6 billion and earnings per share of 59 cents adjusted in line with expectations despite losses in China due to new Covid lockdowns. Net income for the second quarter was $674.5 million, or 58 cents per share, compared to $659.4 million, or 56 cents per share, in the year-ago quarter. The company did not provide guidance for the coming quarters, citing several factors including China, inflation and investment in stores and employees.
Credit: techcrunch.com /