Starbucks’ policy to allow anyone to use its bathrooms and camp out in its shops, announced in May 2018 following a racially charged incident in Philadelphia, appears to be driving down traffic in some of its outlets — in some cases by as much as 84%.
A study by academics from Texas and Massachusetts, using cellphone location data, found that monthly traffic to Starbucks dropped 6.8% following the change in policy compared to traffic at nearby coffee shops. Traffic to shops near homeless shelters, the study found, declined by as much as 84%.
companies constantly need to weigh short-term gains verses long-term gains. this is really hard to do – especially for large companies rewarded quarterly by Wall Street.— Auren 𝐇𝐨𝐟𝐟𝐦𝐚𝐧 (@auren) November 12, 2019
interesting study of @Starbucks using data from @SafeGraph https://t.co/07GXPQYYcQ
According to the study’s authors, the findings show the potential perils of private companies attempting to provide for the public good.
“The results in our study highlight the difficulty companies can have when trying to engage in different forms of socially responsible behavior,” the authors, David Solomon of Boston College, and Umit Gurun of the University of Texas at Dallas, said in a statement.
“While the hope is always that providing public goods will be rewarded by the market with increased sales and new potential customers, this isn’t necessarily the case,” they said. “In this instance, even taking into account new people brought in by the policy, the total number of visits was significantly lower, consistent with crowding of tables and bathrooms deterring customers.”
The research, in collaboration with SafeGraph, looked at cell phone location data tied to 10,752 Starbucks stores between January 2017 and October 2018. It found that individuals spent 4.2% less time in Starbucks stores compared with nearby coffee houses following the implementation of the policy.
After an incident involving the arrest of two African-American men at a store in Philadelphia in the summer of 2018, Starbucks announced that all its stores, and bathrooms, would be open to anyone, regardless of whether they made a purchase. The manager of the store was accused of being racist for calling the police when the men refused to make a purchase or leave.
In a statement to Forbes, Starbucks disputed the study’s findings and pointed to same-store sales increases of 5% across the chain in the most recent quarter.
“As evidenced by our earnings reports, customers are visiting us in record numbers,” spokesman Reggie Borges told the magazine. “The study focuses on cell phone user data. What we are seeing is real customers.”