Seattle-based Coffee giant Starbucks is looking to grow its technological reach through a significant partnership with Microsoft. The partnership enlists the software giant’s Azure blockchain cloud services in combination with other Artificial Intelligence and Internet of Things offerings to bolster its bean-to-cup and other initiatives.
At Microsoft’s Build Developers Conference in Seattle, on 6 May, the two companies announced the initiatives they are working on to boost the coffee company’s stature as an innovation leader in its field.
Starbucks first announced its bean-to-cup initiative in a 2018 pilot, stating that it would work with farmers in Costa Rica, Colombia, and Rwanda to pilot a blockchain-based coffee-tracking system.
The system is said to allow customers to track the production of their coffee and could open up potential financial opportunities for coffee bean farmers at the other end.
The next step for this initiative, through the help of Microsoft, is to allow for things like predictive drive-thru ordering, connecting of coffee-making machines, and a further boost to the bean-to-cup tracking.
A new technological era for Starbucks
Starbucks, in 2018, amassed $24.7 billion in revenue and has firmly established itself as a major global corporation. But this rise to prominence has been accelerating of late. The value of its shares dipped to around $4.50 at the end of 2008 but over the last ten years has steadily climbed to over $50.
However, it is in the last year that the stock price has exploded, climbing to $78 in less than ten months. This spike in growth may well have to do with the company’s decision to become more tech-reliant and take advantage of emerging nascent technologies.
Of course, current Starbucks CEO Kevin Johnson is a former Microsoft executive who ran the worldwide sales and the Windows divisions before joining the coffee giant in 2015.
Microsoft CEO Satya Nadella also noted that the coffee company has been following recent trends to its benefit. He applauded the collaboration between Starbucks’ software engineers and its business side citing Starbucks as one of many examples of a consistent theme: increased hiring of software engineers at companies outside the industry that are embracing high tech solutions.
New initiatives
While the bean-to-cup initiatives is a sound one with supply chain management becoming a blockchain staple - and especially relevant in the coffee industry where fair trade is a huge concern - there are new and exciting ideas.
Starbucks is looking to Microsoft to help with connecting their coffee-makers across its 30,000 stores. By using several Azure cloud products Starbucks could connect and secure the more than a dozen pieces of equipment in each of their stores; from coffee machines to grinders and blenders.
These IoT-enabled machines could then collect more than a dozen data points for every shot of coffee pulled, including the type of beans, the temperature of a cup of coffee and water quality.
Moreover, they are also looking at predictive drive-thru ordering where the app, which already makes suggestions based on previous orders, would extend to digital billboards. This could well be the foundation for facial recognition and targeted recommendations, but that is not being talked about just yet.
The primary blockchain use for Starbucks remains the bean-to-cup initiative which has the overall aim of connecting coffee drinkers with coffee farmers to ensure fair trade, but also for the farmers, it can potentially then allow them to take advantage of new financial opportunities.
