Starbucks’ Introduction of Vibrating Buzzers: The End or Evolution of Communication?

Why Did Starbucks Choose Cold Machines Over Calling Customers by Name?

• The real reason Starbucks abandoned ‘Call My Name’ and introduced vibrating buzzers and kiosks
• Starbucks’ survival strategy balancing rising labor costs and premium positioning
• The two types of Starbucks stores we will encounter going forward

How Did Starbucks Become a Symbol of Customer Experience?

The Starbucks we loved was more than just a coffee shop. Before the advent of Starbucks vibrating buzzers and kiosks, it was a space promising a special experience with people. All of this was meticulously designed under the brand mission to “inspire the human spirit.”

The Third Place: Selling More Than Just Coffee

At the core of Starbucks’ success lies the philosophy of the ‘Third Place’—a sanctuary away from home (first place) and work (second place) where one can simply be themselves. Like Howard Schultz’s belief, Starbucks created deep bonds by embedding each customer’s story into the space. Baristas were the communication hub of this connection.

Call My Name: The Peak of Human Connection

This philosophy shone brightest in the Korean-born ‘Call My Name’ service. Instead of order numbers, customers’ nicknames were called out, adding an analog warmth in the digital age and receiving explosive feedback.

Paradoxically, the success of this most human service proved the need for technology adoption. It showed how open customers were to well-designed digital experiences (Siren Order) and revealed physical limitations during peak times when partners’ voices were hard to hear.

The Dawn of Change: The Trojan Horse, Siren Order

The decisive moment Starbucks transformed from a coffee company to a data technology firm was with ‘Siren Order’. Created to solve the chronic problem of long lunch lines, this mobile ordering app completely changed Starbucks’ future.

Siren Order was not just a convenience feature. It was a ‘Trojan horse’ binding customers to Starbucks’ digital ecosystem. Every order data point (personalized options, visit times, etc.) from registered users became Starbucks’ most valuable asset. This data and the digitally savvy customer base later laid a solid foundation for introducing kiosks and Starbucks vibrating buzzers.

Kiosks and Vibrating Buzzers: Two Hidden Truths

Why did Starbucks abandon its hallmark of human communication and choose machines? Behind the official explanations lies a much more pragmatic business logic.

1. Kiosks: Friendly Assistants or Cost-Cutting Tools?

Starbucks explains kiosks were introduced to overcome language barriers for foreign tourists and ease peak-time congestion. But behind this is the uncomfortable truth of soaring labor costs.

In recent years, labor cost increases at Starbucks Korea have far outpaced revenue and operating profit growth. Labor costs now account for up to 31% of total sales, putting significant pressure on profitability. Ultimately, kiosk adoption was an unavoidable economic choice to alleviate uncontrollable labor cost burdens.

2. Vibrating Buzzers: Practical Tools or Brand Betrayal?

Starbucks vibrating buzzers are officially presented as solutions for special stores like ‘Deobukhan Mountain Branch’ where the store is too large or multi-leveled to call out names. This explanation is close to the truth but there is deeper context.

This is not a mere exception but an inevitable choice supporting Starbucks’ new ‘premium strategy’. Calling out customers loudly in experiential stores over 300 pyeong (approx. 9,917 sq ft) actually harms the premium experience. The seemingly impersonal vibrating buzzer paradoxically acts as a ‘premium experience protector’, helping customers focus on the space’s value without disturbance from noise and chaos.

Two Starbucks: A Sophisticated Market Segmentation Strategy

Ultimately, Starbucks’ moves are not identity confusion but a highly refined ‘market segmentation’ strategy responding to fierce competition. The era of providing the same experience in every store is over.

1. Throughput-Focused Stores

• Features: Located in high-traffic areas like office clusters or subway stations, prioritizing speed and convenience.
• Core Technologies: Heavy use of kiosks and Siren Order to maximize transaction volume and control operating costs. These stores act as ‘defensive moats’ against low-cost coffee brand incursions.

2. Experience-Focused Stores

• Features: Located in special places like the Bukhan River or ‘Gyeongdong 1960 Branch’, offering rest and unique experiences.
• Core Technologies: Use of Starbucks vibrating buzzers for smooth operation and top-tier coffee equipment to maximize brand value. These stores serve as ‘offensive spears’ providing experiences low-cost brands cannot imitate.

Conclusion: Your Choice Shapes Starbucks’ Future

Starbucks has evolved from the romance of human connection to embracing machine logic amid rising labor costs and market competition. This was a meticulous strategic choice for survival.

Key Takeaways:

1. The Paradox of Human Connection: The success of ‘Call My Name’ ironically proved the possibility and necessity of digital transformation.
2. Realistic Pressure: The introduction of kiosks and vibrating buzzers was driven by uncontrollable labor cost increases and profitability decline.
3. Dual Strategy: Starbucks now targets the market with two store types focused on ‘efficiency’ and ‘experience.’

The final question remains for us: When you face a kiosk at the store or feel the vibrating buzzer in your hand, you are sending Starbucks a signal. What do you value more in your cup of coffee? A warm voice or perfect speed? Our choices will shape tomorrow’s Starbucks.