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How Starbucks Turned Crowdsourced Ideas into New Products

Rachel Julkowski, Stanford University September 26, 2018

It was 2008. Nikon and Canon first introduced video-capable SLR cameras. Beyoncé released the anthem “Single Ladies.” Howard Schultz returned to Starbucks for a second stint as CEO. And the crowdsourcing platform, “My Starbucks Idea,” — which would eventually bring to life cake pops, mobile payments, splash sticks and much more — had just launched.

Matthew Guiste, now Vice President for Product Management at Starbucks, ran its crowdsourcing  platform with a small team and the voluntary support of staff from other units. At the time, Starbucks had no presence on social media. “We didn’t have a blog, we had no Twitter account, no Facebook page, there was literally zero,” Guiste shared in a presentation for a group at LeaderLab.

“When Starbucks first started as one, five, even 100 stores, we understood what customers wanted,” says Guiste. By the end of 2007, there were more than 15,000 stores around the world. The crowdsourcing initiative aimed to foster a two-way dialogue to discuss products and ideas, to recapture that sense of closeness with the customer.

The team did no marketing for the new crowdsourcing platform, and still, customers just started interacting. He attributes the engagement to the strength of the Starbucks brand and the simplicity of the platform. “There were really just three things you could do from the site,” Guiste says. Customers could submit ideas, see others’ submissions and view what Starbucks had implemented.

Submissions were tagged by customers into established categories. And, importantly, customers could vote on ideas. Internal to Starbucks, members of other units were invited to participate in reviewing the submissions. New ideas were evaluated based on feasibility, brand fit and user interest indicated by votes.

Responding to and explaining the rationale to users helped avoid mutiny and kept customers offering more ideas.

Within five years, Starbucks reported that the crowdsourcing platform had attracted more than 150,000 suggestions, and that the organization had implemented 277 of the ideas.

Reflecting back, Guiste shared four key lessons for any organization seeking to crowdsource fresh new ideas from the crowd.

1. Show Visible Change

Guiste and his team continually expressed how critical the success of the crowdsourcing platform was for every employee at Starbucks. “We built this platform. We needed to do something with it,” says Guiste. “It would be damaging to do nothing.” The team continually expressed why the initiative mattered and why suggestions needed to translate into visible actions by Starbucks.

2. Be Transparent and Direct

Customers had many ideas and challenges. Often the ideas were good and received significant support from the crowd via votes. The internal team running the platform needed to understand the importance of providing feedback on the crowd’s favorite ideas, especially if the idea was not selected. “You can’t respond to all ideas, but you needed to understand what to respond to,” says Guiste. He recalls a popular suggestion for coffee-flavored ice-cubes. The internal team loved the idea. But it wasn’t something the organization could realistically implement because none of the stores had freezers. Responding to and explaining the rationale to users helped avoid mutiny and kept customers offering more ideas. Guiste highly recommends just being direct because contributors can sense when someone isn’t being upfront.

3. Prepare the Organization to Use Crowdsourcing Data Effectively

The users who participated in the crowdsourcing platform were a small, but highly engaged audience. It was important to prepare the organization for how to interpret feedback and ideas from this group. The platform was not there to dictate organizational decisions. The platform was intended to provide a data point in addition to other performance metrics. Guiste recommends preparing your organization to effectively evaluate notes, especially negative feedback. In one case, users on the platform strongly disliked a specific kind of coffee. The team evaluated the feedback in the context of sales figures and other metrics, which demonstrated that the coffee unpopular on the platform was a top seller in stores. Starbucks continued to sell the coffee.

4. Create a Mechanism for Clear Feedback

When Starbucks launched its crowdsourcing platform, the company provided responses on the platform using the same commenting feature available to users. It was hard for users to “hear” or “see” the organization’s responses and reactions using this method. Soon after launch, the team created a blog to make the organization’s feedback and notes more visible to users. Guiste recommends thinking through how your organization’s responses will be heard. Organizations need to be able to send a clear signal through all the noise.