Howard Schultz: belief

Transcript context

…Right. The breakage. There’s this benefit of, it’s a reasonably predictable amount of cash that comes in that you get to use for your advantage. In terms of velocity, about $14 billion a year gets loaded onto gift cards. It’s unbelievable. If you actually look at all of the banks in America, if Starbucks were a bank and you treated the gift cards as deposits, it would be in the top 10% by deposits of banks in the United States. It’s this unbelievable business model that happens to exist inside of this experiential business that powers this experiential business. But to your point, you have to keep it from eating the core. Let’s just go back, not to the economics but the idea itself, and I think whether we talked about bottled Frappuccino, the cup, you just thread all these things. There is a common through line, and that is we took a commodity business and we transformed it into a premium product brand and experience. But when you are disrupting the market, there has to be some governor on the disruptive innovation to monitor how it is being used, how it is being abused, and the era of judgment in the period where this was really where we really took hold this five year period between 2018 and 2022, is the government didn’t exist. You feel like it wasn’t really taking hold in that whole before.…

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