Starbucks is still 'third place,' but now it's shifting to drive-thru stores
Photo / Peter Van Allen
A Starbucks under construction on Payne Road in Scarborough will feature a drive-thru window.
Starbucks is on the verge of opening three coffee shops in Maine. But, in line with other post-pandemic retail shifts, the stores will follow a different model than previous locations have.
In the past year, Starbucks closed two stores in downtown Portland, on Middle Street and Congress Street. The Maine Mall store has also closed.
Yet the Seattle-based coffee giant is growing in other ways — with a drive-thru window being a key feature.
There's a new store under construction at 465 Payne Road in Scarborough, near Marden's. Two others are under construction in Bangor. For each, a key element will be the drive-thru window.
Anne Krieg, director of community and economic development for the city of Bangor, said one store is planned for a front pad outparcel at 693 Broadway, not far from the Husson University campus. She reports that the shell of the building has been completed.
The second new Bangor location will be at 570 Stillwater Ave., next to the Kohl's and L.L.Bean stores, in the mall area.
The Starbucks on Bangor Mall Boulevard has a long queue pretty much all day, as Krieg noted. So it's not surprising that another shop is planned nearby.
A Starbucks spokesperson said the Payne Road location in Scarborough and Stillwater Avenue store in Bangor are scheduled to open this spring. The Broadway store in Bangor will open this summer.
For now, Bangor has that one Starbucks and another inside a Target store.
Post-pandemic shifts
With the new locations, customers will still have the option of coming into the store. But a large percentage of walk-ins now make mobile orders, so the customer visits will be in-and-out.
Die-hard customers who like to hang out or work remotely from a Starbucks will still find seating.
For years, the company promoted its philosophy of being the customer's "third place," along with home and work. Customers were encouraged to linger. There were comfortable chairs, WiFi and Starbucks' own blend of soothing music. A growing food menu encouraged long stays.
But when the pandemic shifted everyone's business model, Starbucks shifted much of its business to mobile apps, which allow customers to order in advance and pick up either at the drive-thru or inside the store.
A 'reinvention'
Sean Dunlop, an analyst who follows Starbucks for Morningstar, says that what Maine is seeing is part of a trend.
"About 80% of the chain's net new stores in the U.S. have a drive-thru, which is leaps and bounds ahead of the historical mix. Today, 30% of the business comes through mobile order and pay or delivery, and 70% comes through [market operating price] and drive-thru," Dunlop tells Mainebiz.
"The firm is simply tweaking its real estate to reflect a world where 25% of traffic no longer comes through the in-restaurant channel," he adds.
In the restaurant industry in general, he says, deliveries make up nearly 20% of sales, driven in a large part by pizza and Chinese food. In-restaurant dining continues to lose market share, with customers favoring quick-service restaurants.
"We live in a world where consumers increasingly value the convenience provided by mobile ordering, loyalty programs, saved payment methods and scheduling," Dunlop says. "That's just starting to get reflected in the restaurant estate, and figures to continue to play out for years to come."
Portland changes
Amid the Starbucks reinvention, the chain has applied for a zoning variance to open a store with a drive-thru in a Portland strip mall, across the street from a Starbucks branch in Northgate Plaza. The proposal for the location, at 84 Auburn St., is working through the Planning Board process and is expected to be reviewed in March.
An outlier in the shift toward drive-thru stores may be Starbucks' location at 145 Commercial St., in an area of the Old Port with heavy foot traffic. That store just underwent an extensive renovation.
With the closing of the stores on Middle and Congress streets in the past year, the city of Portland now has three Starbucks stores, plus a location at the Portland International Jetport.
Starbucks (Nasdaq: SBUX) reported a record $36 billion in revenue in the most recent fiscal year. In 2022, the company launched a "reinvention" plan that included an expansion from under 36,000 stores worldwide to 55,000 of them by 2030. The plan also includes doubling the number of rewards customers from what was then 75 million people. Much of the store growth will be international.
As of 2022, the company had 16,300 U.S. stores, and planned to grow that number by a relatively modest 4%.
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