Starbucks loses market share

Starbucks Corp., facing heavy competition, mobile-ordering hiccups and even boycott threats, has been losing U.S. customers to rivals this winter.

In February, the company ceded market share to other chains, according to data from xAd Inc., a research agency that uses location signals from mobile phones to measure customer traffic. Starbucks' share declined to 11 percent among the U.S. restaurants tracked by xAd, down from 12 percent in January.

Competitors have been offering aggressive drink deals, putting pressure on the whole industry. And Starbucks acknowledged in January that its shift to mobile ordering has hampered customer service and hurt sales.

Starbucks spokeswoman Haley Drage declined to comment, citing the company's policy of not giving details on financial performance during the quarter. The coffee chain is scheduled to report its next earnings on April 27.

The company also may have rankled some customers when it said it would hire 10,000 refugees over the next five years. CEO Howard Schultz made the move in the wake of President Donald Trump's executive order in January seeking to bar U.S. admission of refugees. Starbucks was threatened with boycotts and drew criticism on social media.

The refugee announcement 'could have upset some customers, perhaps negatively impacting sales,” Credit Suisse Group analyst Jason West said in a report. 'Our work shows a sudden drop in brand sentiment following announcement of the refugee hiring initiative on Jan. 29.”

Starbucks also cut its annual revenue forecast in January, leading to five straight days of declines for the stock. It's been hurt partly by a broader slump in the restaurant industry. A record-setting bout of food deflation has made it cheaper for many Americans to eat at home, so they're bypassing restaurants.

To get customers back in the door, chains are relying more on discounts and rolling out new services. Dunkin' Donuts recently has advertised afternoon drink specials, and Panera Bread expanded a rapid pickup service.

McDonald's, meanwhile, will start selling $2 McCafe drinks in April.

For its part, Starbucks has been advertising hot and iced macchiatos - along with hearty winter foods, such as ham-and-cheese croissants. It's also working on a solution to the problem of congested pickup counters.