Starbucks Turns To A Celebrity CEO As It Struggles To Define Itself For An Era Of Mobile Orders – CoffeeTalk

Starbucks is struggling to meet customers’ changing needs without losing its coffeehouse roots. To recapture what once made it special and turn around sagging sales, the company is turning to Brian Niccol, an experienced marketer who previously led Taco Bell and Chipotle. Niccol takes over as Starbucks’ chairman and chief executive on Monday. With nearly 40,000 stores around the world, Starbucks feels like it’s on nearly every corner, but its premium prices are a turnoff to many customers who just want a quick jolt of caffeine. At a Manhattan Starbucks, a medium Pumpkin Spice Latte is now almost $8.

Consumers who want a higher-end coffee experience, meanwhile, are seeking out independent cafes or upscale chains like Blue Bottle. Howard Schultz observed the chaos he observed at a Starbucks in Chicago one recent morning, summed up the troubles of the company he long led as chairman and CEO. Starbucks is turning to Brian Niccol, an experienced marketer who previously led Taco Bell and Chipotle.

Streamlining Starbucks’ menu is key to eliminating the kind of disarray Schultz reported seeing in Chicago. Phil Kafarakis, president and CEO of the International Foodservice Manufacturers’ Association trade group, said that Niccol needs to figure out who Starbucks’ core customers are, what they like to drink, and then start trimming the excess. Starbucks baristas are tasked with making around 100,000 different variations on a consistent basis because of the many ways patrons can customize their drinks.

New drinks can also muddy Starbucks’ messaging. Six years ago, the company announced an environmental milestone: it would eliminate single-use plastic straws globally by 2020. But this summer, single-use plastic straws were back, tucked into Starbucks’ new cold boba drinks. Starbucks said the new straws are made of compostable plastic. The Ocean Conservancy, which once praised Starbucks as a “shining example” for eliminating single-use straws, said many composting systems aren’t equipped to manage compostable plastics. Companies should move away from disposables altogether, the conservancy said.

Even as the beverages have gotten more complex, baristas have come under pressure to make them more quickly. Almost 75% of Starbucks’ orders now come through Starbucks’ mobile app, drive-thru windows, or delivery partners like DoorDash. Fewer customers linger in stores.

Michelle Eisen, a Starbucks barista and union organizer, said her Buffalo, New York, store no longer has the chill coffeehouse vibe it had when she started in 2010. Starbucks recently added new brewing machines and workstations to help baristas prepare drinks, but the number of workers has remained stagnant or fallen at many stores. As a result, Starbucks has fallen behind some rivals in service delivery times.

At Chipotle, Niccol streamlined store operations to shorten wait times, beefed up marketing, and lured customers back with limited-time menu items. Remaking Starbucks could be much more difficult due to many more stores and varying challenges around the world, including low-cost competitors in China and ongoing boycotts in the Middle East.

Starbucks’ board clearly thinks Niccol has the expertise to chart a new course. Under his generous contract, Niccol could make well in excess of $100 million in his first year at Starbucks. He will continue to live in California and commute to Starbucks’ Seattle headquarters using a corporate jet, a perk that seems to run counter to Starbucks’ goal to cut its carbon emissions in half by 2030.

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