How Starbucks’ 20,000 Square Foot Innovation Center Will Bring New Tech To Its 27,000 Locations

From http://www.geomarketing.com
Starbucks is currently building a 20,000 square-foot space that will house its TRYER Innovation Center. As Brent Cashell, TRYER’s director, describes it, rthe center is “a combination of a makers space and a Starbucks store where everybody who works at Starbucks can come down and test their idea.”

Those ideas can range from “a cool idea for a new drink or a payment process, and then collaborate with others to figure out how that’s going to work in the real world,” Cashell said, speaking to the audience at Kwolia’s Retail Innovation Lounge during SxSW this past Saturday.

Cashell has worked at Starbucks for 16 years, starting as a barista at one of its locations. The name of the center comes from the use of a “tryer,” which is a piece of equipment used as you’re roasting coffee to constantly check whether the beans are ready. “The tryer is Y-shaped, and looks kind of like a tuning fork. The funny thing is, you can have a million dollar system running a coffee roaster and if you don’t use the Tryer, you’ll burn the coffee.”

In that sense, the TRYER Innovation Center reflects Starbucks’ approach to technology as a search for the necessary tool to solve basic problems.

“Innovation is one of those things where it’s really easy to use the name and the buzzword and it’s really hard to define what it is and what is the purpose of it,” Cashell said. “Let’s think about it this way: the purpose of a shovel is not to have a metal spade and a nice long handle and to be strong and look great in a shed. The purpose of a shovel is to dig a hole. So the purpose of running innovation at Starbucks is not so that we simply have something cool or launch something to get attention for its own sake. The ultimate goal is to have something that matches what your consumer actually needs, wants, and has an emotional connection to.”

Innovation, From Definition To Implementation
After figuring out what innovation means, the hardest part comes when attempting to implement it seamlessly at a company as vast as Starbucks.

“We have 27,000 locations, globally, and 10,000 of those are here in the U.S. — 15,000 if you count all of our licensed store locations domestically — so, even if I have a great idea that I want roll out tomorrow, I still live in a very physical world,” Cashell said. “Where in order to get that thing installed in 15,000 locations, just here in the U.S., is really time consuming. And it’s kind of catastrophic to the physical environment, because that beautiful bar that we’ve created that holds our coffee equipment is made out of real things that are made to last a long time, so if I cut it in half, and try to shift it over, that just kills every business space, if we do it.”

The other big universal questions Starbucks wrestles with when it comes to advancing technology and services is “how does a new feature or program actually appear in a store setting? And is that worth the time and effort in pursuing?”

The process that will govern Starbucks’ TRYER Innovation Center will involve the ability to take an idea to a prototype, whether that’s physically on a station, or just a digital mock-up, in less than 24-48 hours so the company can understand the basics of how an idea might work in the real world.

“None of us are shopping the same way we were three years ago, none of us are working in the same routine we were three years ago,” Cashell told the Austin audience. “We’re wearing different clothes, we’re eating different foods. Everything’s always changing, and we always have to be relevant. What we’re really trying to solve here is ‘the pace of innovation,’ the ability to learn as fast as possible with as least investment as possible and then over time, to create and transform how we innovate.

“We do that through the physical locations that we innovate in,” Cashell continued, “we do that through working together more collaboratively and really focusing on the customer value and designing everything with our customers in mind together with our partners in the store.”

We caught up with Cashell after his RIL talk to discuss additional ways Starbucks applies those principles to mobile ordering, voice activation, and on-demand.

Starbucks Develops Its Voice
In essence, Cashell said that Starbucks’ pioneering use of Mobile Pay & Order has served as a template for other technology and store features. It starts with focusing on a small number of store locations to approximate the experience of being a “startup” (as much as a public company currently trading around $60 per share can adopt that posture).

From there, it’s about learning and asking more questions as opposed to trying to get everything 100 percent correct and anticipating how these services will be used in five years as opposed to five months down the road. So flexibility is prized over comprehensiveness.

For the moment, Starbucks is applying that sensibility to voice activation. In January, Starbucks unveiled its Amazon Alexa “skill” that allowed for voice ordering (a Google Android version for the Google Assistant will be rolled out later this year) via the “My Starbucks barista.”

Given Starbucks’ 13 million “rewards members” who access ordering through its apps and online, the idea of extending that ability to voice activation assistants is a way for Alexa, Google Assistant, and eventually perhaps Apple’s Siri, to take advantage of such huge scale for what’s still a relatively new technology feature as far as most consumers are involved.

“The Starbucks experience is built on the personal connection between our barista and customer, so everything we do in our digital ecosystem must reflect that sensibility,” said Starbucks CTO Gerri Martin-Flickinger, in January. “Our team is focused on making sure that Starbucks voice ordering within our app is truly personal and equally important was finding the right partner in Amazon to test and learn from this new capability. These initial releases are easy to use providing a direct benefit to customers within their daily routine and we are confident that this is the right next step in creating convenient moments to complement our more immersive formats. We expect to learn a lot from these experiences and to evolve them over time.”