Starbucks CEO Brian Niccol outlines 7 plans to transform the coffee chain.

• U.S. customers are being targeted by CEO Brian Niccol's plan to attract them back to Starbucks stores.
• To reduce service times to under four minutes, Starbucks can implement several changes.
• The coffee chain intends to reduce the number of its locations in the upcoming fiscal year to fund its turnaround.

During the company's quarterly conference call on Wednesday, CEO Brian Niccol provided more information about the company's turnaround strategy.

Despite three consecutive quarters of declining sales, Starbucks is optimistic that minor adjustments to its U.S. operations will help turn the tide and ultimately lead to a more comprehensive strategy.

Niccol stated that about half of current transactions at Starbucks are completed within the four-minute goal for delivering a customized drink to customers.

To free up capital, Starbucks is planning to reduce the number of new locations and renovations in fiscal 2025 while focusing on the turnaround, as CFO Rachel Ruggeri informed investors on the call.

Starbucks reported a third consecutive decline in revenue, resulting in flat shares in extended trading on Thursday.

Here's how Niccol plans to help Starbucks' sales rebound:

Ending the disorder of mobile order and pay

Niccol aims to reduce the number of mobile orders at Starbucks cafes.

"Sometimes, despite its effectiveness, it can be challenging for both customers and partners," he informed investors during the company's conference call.

Mobile orders account for more than 30% of Starbucks' U.S. transactions.

Niccol stated that Starbucks aims to enhance the accuracy of the app's timing, allowing customers to be informed when their drinks are ready. Additionally, he intends to distinguish mobile order pickups from in-person ordering within restaurants and limit the extent to which customers can personalize their drinks.

"Currently, Niccol believes that the customization options in the mobile order app are too broad and unnecessary. He suggests implementing better guardrails to ensure that customers receive the correct customization for their drink orders, while also allowing baristas to maintain consistency in their execution."

Cutting back an 'overly complex' menu

The Starbucks menu will be getting a makeover.

Niccol suggested that the coffee chain should concentrate on providing "fewer, better" options. By reducing the menu, baristas will be able to make each drink with greater consistency, which will ultimately enhance the speed of service.

Niccol stated that the menu always includes long-tail items that are not executed as well, and baristas often take longer to make drinks that are unfamiliar.

Niccol stated that Starbucks would examine the items that wouldn't have been included on the menu if the four-minute standard was already in place.

Niccol believes that customers will value faster and more consistent service, despite any initial disappointment.

Making cafes more personal

Niccol's "Back to Starbucks" plan aims to make Starbucks locations feel like "third places" for customers to work and socialize in outside of their homes and offices.

The coffee chain's success as a "third place" helped it expand globally, but it eventually lost its reputation. Niccol plans to reintroduce personal touches, such as serving coffee in ceramic mugs to customers who want to linger in cafes. Sharpies will also return, having been replaced by printed labels.

Starbucks is reevaluating its store designs to prioritize comfort and provide additional amenities.

Niccol stated that the majority of what we have are cafes that lack the right seats, texture, layers, and warmth. He emphasized the need to bring those elements back.

Niccol suggested that the company's pickup-only locations, which lack seating and are predominantly found in urban areas, could be made more welcoming to customers.

He stated that despite some executions not fully embodying the traditional coffeehouse experience, there are still design elements that can convey the idea of a community coffeehouse.

Bringing back the condiment bars

Since the start of the Covid pandemic, Starbucks removed its condiment bars from the counter, requiring customers to request milk or sugar from baristas for their drinks, including a basic drip coffee.

Niccol stated that the condiment bars will return, allowing more time for baristas and alleviating some customer difficulties.

Better staffing in cafes

The company has been reducing its turnover and improving retention by scheduling more shifts and providing more consistent scheduling for its baristas.

Niccol wants to ensure that cafes are adequately staffed during peak hours, as well as during the busy morning and evening rush.

A new approach to marketing

Since his first week on the job in early September, Niccol has expressed his desire to revise the company's marketing strategy. During Wednesday's call, he stated that he wants the marketing efforts to focus on a broader audience than just Starbucks Rewards members and to highlight the quality of Starbucks coffee.

Niccol stated that discount-driven offers are "ineffective" and can overburden baristas, resulting in fewer deals as part of the marketing shift.

Tressie Lieberman, a former Chipotle alum, has been appointed as the new chief global brand officer of Starbucks by Niccol, who has a marketing background and previously led Taco Bell.

Dairy alternatives finally won't cost extra

Starting Nov. 7, Starbucks will stop charging an additional fee for milk substitutes, allowing some customers to save over 10% on the cost of their drinks.

Starbucks has no plans to alter North American prices during the upcoming fiscal year, ending in early October, in an effort to enhance consumers' perception of its pricing.

Occasional customers have stopped visiting the locations as often due to pushback against higher prices, according to executives.