Starbucks loses market share as rivals roll out deals


(Source: | 8 March 2017)

Starbucks, facing heavy competition, mobile-ordering hiccups and even boycott threats, has been losing U.S. customers to rivals.

In February, the company ceded market share to other chains, according to data from xAd Inc., a research firm that uses location signals from mobile phones to measure customer traffic. Starbucks’ share declined to 11 percent among the U.S. restaurants tracked by xAd, down from 12 percent in January.

Competitors have been offering aggressive drink deals, putting pressure on the whole industry. And Starbucks acknowledged in January that its shift to mobile ordering has hampered customer service and hurt sales. The hassles could be driving some people to other coffee shops, said Bloomberg analyst Jennifer Bartashus.

“The operational issues may be keeping people out of stores,” she said. “There’s also just a lot of competition out there.”

The company may also have rankled some customers when it said it would hire 10,000 refugees over the next five years. Chief Executive Howard Schultz made the move in the wake of President Donald Trump’s executive order in January seeking to bar U.S. admission of refugees. Starbucks was threatened with boycotts and drew criticism on social media.


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