Starbucks Deep Brew: AI-Powered Customer Experience

Flashcards providing a comprehensive review of the Starbucks Deep Brew case study, including industry statistics, competitive landscape, technological infrastructure, and strategic implementation of AI.

Who was the chief executive officer of Starbucks facing the decision to harness AI-powered technology?

Kevin Johnson

What is Deep Brew?

An AI-driven platform designed to personalize customer experiences, optimize store operations, and manage inventory

By how much did Levi Strauss & Co. increase their sales of loose-fit jeans using AI to analyze shopping trends?

$15$ per cent

What was the valuation of the global coffee industry in $2023$?

$US\$484$ billion

What is the projected compound annual growth rate (CAGR) for the global coffee industry through $2030$?

$5.2$ per cent

What was the valuation of the specialty coffee segment in $2024$?

$101.6$ billion

What is the expected CAGR for the specialty coffee market from $2025$ to $2030$?

$10.4$ per cent

Which three companies are cited as 'third-wave coffee shops' representing major competition?

Blue Bottle Coffee Inc. (Blue Bottle), Stumptown Coffee Roasters (Stumptown), and Intelligentsia Coffee (Intelligentsia)

In what year and city was Starbucks founded?

$1971$ in Seattle

As of the case data, how many locations and markets does Starbucks operate in globally?

More than $38,000$ locations across over $80$ markets

What was the total Starbucks revenue reported for the year $2024$?

In excess of $36$ billion

How many active members were part of the Starbucks Rewards program as of $2023$?

Over $31$ million

The Starbucks Rewards program contributes what percentage of the company's US revenue?

Nearly $57$ per cent

By the year $2019$, what percentage of total Starbucks sales consisted of digital transactions?

Nearly $30$ per cent

What does the acronym C.A.F.E. stand for in Starbucks' sourcing practices?

Coffee and Farmer Equity

Who succeeded Kevin Johnson as CEO and continued the focus on AI and automation?

Laxman Narasimhan

In what year was the Starbucks mobile app first launched?

$$2011$$

Which specific IoT-enabled equipment tracks metrics such as temperature, pressure, and maintenance needs in-store?

Mastrena espresso machines

Which cloud-based computing platform provides the infrastructure for the Deep Brew AI and machine learning models?

Microsoft Azure

What does EDAP stand for in the context of Starbucks' data infrastructure?

Enterprise data analytics platform

Which two global privacy regulations are specifically named as part of Starbucks' data governance framework?

General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA)

Which healthcare start-up project failed due to technical issues and poor adoption despite using AI?

Forward Health (CarePods)

How does Deep Brew assist store managers with staffing needs?

It uses historical transaction data and AI-driven forecasting models to predict peak hours and schedule shifts effectively

Which fast-fashion retailer's AI model was criticized for environmental harm and unethical labor practices?

Shein

As a strategic leader in AI, what three core operations did Kevin Johnson state Deep Brew would increasingly power?

Personalization engine, store labour allocations, and inventory management