Starbucks rolls out its summer lineup as cold drinks drive sales growth

Key Points
  • Starbucks announces its summer food and drink menu.
  • The coffee chain said last week that cold drinks helped drive sales during all times of the day.
  • Starbucks is bringing back three Frappuccino favorites and introducing a new iteration of the cold brew, along with the Dragon Drink.
Mark Makela | Reuters

Starbucks is signaling the start of warmer weather by rolling out its summer menu, and investors can expect sales to heat up as customers clamor for its chilled drinks.

Even in the chilly winter months, cold beverages have helped Starbucks' sales grow. So the company's strategy has focused its innovation on cold options, like cold foam. Another chilled beverage innovation, Nitro Cold Brew, is available in about half of its U.S. stores as Starbucks targets nationwide availability by the end of year.

In its second quarter, the company reported that sales at stores open at least 12 months rose 3%, beating Wall Street's estimates of 2.9%. Starbucks attributed the growth to a 3% increase in average customer ticket. Nearly half of the ticket growth came from customers trading up to pricier drinks like the Cloud Macchiato.

Additionally, cold drinks are helping attract customers into stores during all parts of the day, way past the busy morning rush. Afternoon performance during the latest quarter was the best it's been in three years.

"We have seen when we introduce more of our cold beverage innovation, it's improving afternoons and our nonmembers [of Starbucks Rewards] tend to shop with us in the afternoons," COO Roz Brewer said on the quarterly conference call with analysts Thursday.

But, one cold option has been getting less love. Starbucks has been moving away from limited-time Frappuccinos. The last one to make a noticeable impact on sales was the Unicorn Frappuccino, which was introduced in April 2017. Since then the Seattle-based company has largely failed to replicate its success with another version of the blended drink. This year, its summer menu is bringing back three popular versions of the blended drink without introducing any new Frappuccino options.

"We're learning that it's an 'and' and not an 'or," Brewer said in an interview, adding that Frappuccinos will always stay on its menu.

The coffee chain is also introducing a Crispy Grilled Cheese Sandwich, Baja Black Bean Veggie Wrap and Frosted Doughnut Cake Pop for the summer.

Here's its summer drink lineup announced Tuesday:

Dragon Drink

Starbucks Dragon Drink
Source: Starbucks

The new summer offering combines Starbucks' Mango Dragonfruit Refresher with coconut milk for a fruity and creamy beverage. Like the Unicorn Frappuccino, this option is designed for Instagram. Dragonfruit sourced from Vietnam gives it that bright pink color.

Cold Brew with Salted Cream Cold Foam

Starbucks Cold Brew wth salted cream foam.
Source: Starbucks

The latest addition to Starbucks' lineup of cold brew features a hint of caramel topped with its frothy cold foam. The beverage is a year-round addition to the menu as Starbucks tries to entice customers looking for healthier options with a cold foam that's light on the tongue and on calories.

S'mores Frappuccino

Starbucks S'mores Frappuccino
Source: Starbucks

Last summer, Starbucks disappointed customers when it didn't bring back the S'mores Frappuccino. After reading their complaints on social media, the coffee chain is bringing it back this season — and it doesn't sound like Starbucks will make that mistake again. Brewer said the company thinks that the blended drink could be summer's version of the pumpkin spice latte as the popular way to usher in a new season.

Mocha Cookie Crumble Frappuccino

Starbucks Mocha Cookie Crumble Frappuccino
Source: Starbucks

Another summer favorite is also returning. The Mocha Cookie Crumble Frappuccino was introduced in 2012. The blended drink is made with vanilla syrup, chocolate-flavored whipped cream and chocolate cookie crumbles.

Caramel Ribbon Crunch Frappuccino

Starbucks Caramel Ribbon Crunch Frappuccino
Source: Starbucks

Starbucks rounds out its limited-time Frappuccino offerings with a version that incorporates caramel syrup, dark caramel sauce, caramel drizzle and a crunchy caramel sugar topping.

How Starbucks went from one coffee bean store to an $80 billion business
How Starbucks went from one coffee bean store to an $80B business