Say Good Night to Starbucks Evenings, for Now

Image: Starbucks

When the fast casual segment began pursuing beer, wine and spirits sales, it disrupted the restaurant industry. Operators within the disruptive segment saw that beverage alcohol could, at least theoretically, attract a larger percentage of LDA and LDA-plus consumers to their venues. Alcohol programs can (and do) cause consumers to make the choice of patronizing a fast casual operation over not only a quick service venue but also casual dining restaurant.

One fast casual alcohol program that certainly disrupted the quick service and casual dining segments was first tested by Starbucks in 2010. Called Starbucks Evenings, the program was officially implemented in 2014, eventually spreading to 439 stores. “We've always been your neighborhood morning stop—a place to help you start your day,” said Starbucks of Evenings on their website. “Now we're bringing a little delight to your evenings too.”

The focus of the Evenings promotion was craft beer and wine, supported by bar bite-type snacks and shareables such as flatbreads, truffle mac and cheese, and artichoke dip. The thinking, as the promotion’s name implies, was to boost evening sales. Could Starbucks lure their loyal guests back after the morning and afternoon dayparts? Sure, customers started their day with their caffeine fix, and a large percentage of them turned to the coffeehouse kingpin for a pick-me-up when they crashed in the afternoon, but how could they get them return for the evening?

Craft beer’s growth has been (up until now) explosive and likely seemed the ideal solution for Starbucks to increase evening traffic. The furthest thing from most professionals’ minds is caffeine in the evening, so again, beer and wine sales probably seemed like a no-brainer to boost evening sales. It’s also no secret that the Millennial cohort is a valuable demographic to the fast casual segment. In 2013, David Henkes of Technomic said that Millennials “certainly index a lot higher when it comes to fast-casual usage, and they’re much more likely to experiment with different kinds of drinks.” The majority of fast casual operators, according to the National Restaurant Association’s 2016 Restaurant Industry Forecast, expected their businesses to be more profitable than they were in 2015, and as industry professionals will recall, the category drove restaurant growth in 2015. Everything appeared to be aligning for the Evenings program to succeed.

However, as of January 10 of this year, Starbucks has ended the Evenings promotion at more than 400 of their stores. In 2014, the company announced their plans for one-quarter of Starbucks stores to sell beverage alcohol products. Just a few years later, Starbucks has ended the program. The question is, did the program simply unexpectedly fail to gain traction with their customers, deviate too far from the Starbucks brand, or has the company shifted their strategy?

While all three could be factors, it’s quite possible the latter is the closest to the truth. In December of last year, former CEO Howard Schultz announced the company’s plan to introduce two higher-end Starbucks concepts in the second half of 2017: Roastery and Reserve stores. Roastery, as the name implies, will feature on-site roasting, pour-over coffee, and nitro cold-brew beverages. Reserve stores will be similar in concept to Roastery, but without the actual on-site coffee roasting. It’s on the menu of these stores that Starbucks now plans to sell beer, wine and spirits. It’s possible, and only time will tell, that an Evenings-type program will succeed within these new concepts, speaking to a different consumer seeking beverage alcohol from a brand and venue to which they are wholly loyal.

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