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In this age and time, when most consumers are increasingly shifting their retail shopping towards online shopping and e-commerce, one company has made a decision to shut down its online e-commerce store. I am talking about Starbucks, one of the worlds biggest coffeehouse chains. In late August, the company put a notice on its online store informing people about the closure, and just last week, they finally shut down their online store.
Maggie Jantzen, a company spokeswoman said that this decision was made to simplify the companies sale channels. Shutting down the online stores does decrease the amount of distribution channels Starbucks has, but according to me, it eliminates one of the easiest distribution channels Starbucks has. It is a zero intermediary distribution channel, in which the producer (Starbucks) sells directly to the consumer. The company would directly earn revenue from the consumers.
The major disadvantage of this decision would be that consumers would lose access to two important things. First of all, they will not be able to get Starbucks merchandise and syrups delivered right to their doorsteps from Starbucks. Second of all, Starbucks will be permanently discontinuing its syrups, such as the Pumpkin Spice Latte because these are only sold on the online store. Some customers are very sad about this decision and have been constantly posting on Twitter to show how they are against this decision. This decision could potentially lead to a negative consequence for Starbucks, which is that they may lose some customers who only shopped on the online stores, and the company may face some loss of revenue but it would not be anything major as a lot of people still buy products from the stores or groceries.
A Starbucks Syrup
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Starbucks has also said that this decision was taken so that retail stores would increase their performance and provide customers with a very good experience. Starbucks recently shut down around 400 branches that were underperforming, and wants to make sure that more stores do not continue to underperform. Customers would now go to the retail stores to buy the merchandise, as well as bulk buy their coffee supply. While they are purchasing this they might decide to buy a snack and a coffee to eat over there. These are ways performance is being increased.
I personally believe that if Starbucks wants to increase the performance of their retail stores, then they should start selling the syrups they sold online in these retail stores. No one is gaining anything from discontinuing the syrups, as consumers are losing some of their favourite products and Starbucks is losing the revenue made on these syrups. This would be my recommendation to Starbucks
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