Starbucks a Data Technology Company in the F&B Industry?
With 90 million transactions in a week in about 25,000 stores worldwide this coffee giant is in many ways on the cutting edge of using Big data and Artificial Intelligence to help marketing, sales, and business decisions.
What is Artificial Intelligence doing in Marketing?
We are staying in the era of a technological revolution. AI marketing is a process of utilizing customer’s data and AI concepts to predict customer’s next moves and perk up the customer journey. It enables marketers to build a clearer picture of their target audience to provide them with what they need and demand.
For Artificial Intelligence to survive in Marketing one core element is Big Data. People say Artificial Intelligence Marketing has made the life of marketers easy in the area of marketing. Yes, it has. But to make it easy we need Big Data. Big Data is the large volume of data of the company’s consumers and their behavioral patterns.
A company thus combines big data and artificial intelligence to deliver a strategy or campaign to drive consumer conversions.
How Starbucks uses it?
“We haven't seen you in a while, please take a complimentary coffee the next time you come to our store.”
I just received this mail from Starbucks a day before writing this blog. How does Starbucks know that because of COVID I haven't stepped out of my house to buy a cup of coffee?
I realized Starbucks is not short on data. Starbucks just doesn’t make coffee, but it uses its customer data to make it’s coffee worthwhile. It uses its customer’s data and technology to enhance customer experience and streamline its operations.
We all know about the Starbucks App which has a Loyalty and Reward Program. The app has 17 million users and the reward program has 13 million active users. We users create overwhelming data about our preferences, choices, our location, and our experience. That helps Starbucks give us a special promotion.
While researching more about this topic, I realized the Starbucks does more than their reward program to satisfy us. It uses our data for a lot of other purposes and mixes with the technology available to them to give us our perfect cup of coffee.
Have a look at this infographic for a better understanding.
Does this mean AI will replace Marketers at Starbucks?
Just because AI and Big Data are able to give great customer satisfaction and give Starbucks great revenue doesn't mean the marketing team at Starbucks will be fired. For AI to give results and to measure those results there is a team behind it and that team consists of marketing professionals. AI can be created but it cannot replace a human function. AI needs creative strategies to work. The creative thought behind those will be given by marketers. A critical strategy is required to ensure the smooth functioning of the AI. As mentioned above Big Data is also important to make an AI feature. AI functions well because of the data the company has.
As marketers, we collect data and understand their trends. A technology can collect the data, give you behavioral patterns probably even tell you the trends but not tell you how to change your strategy or make changes to it. A human brain and human understanding are required for that.
On the upside, I feel the introduction of AI technology is making marketers think more strategically, as to know they will think of how this could be used to my brand advantage.
No AI technology will replace what Starbucks marketing team is bringing on the table.
“Artificial Intelligence has the same relation to intelligence as artificial flowers have to flowers.”
-David Parnas
Interesting right!
So the next time you go to Starbucks, take a minute to appreciate the Data and Artificial Intelligence that are at work to provide you with the best delightful experience.
Enjoy your coffee and see you next week.
