Things are about to change at Starbucks. Or, maybe we should say that things are about to go back to normal.
That’s new CEO Brian Niccol’s plan, at least. He announced his “Back to Starbucks” plan in September and elaborated on it during a Wednesday earnings call.
In his Sept. 10 “Message from Brian” letter, Niccol said that he realized through visits to Starbucks locations that the chain is has become “woven into the fabric of people’s lives and the communities we serve,” since it first opened in 1971 at a location in the Pike Place Market of Seattle, Wash. However, he also noted that “there’s a shared sense that we have drifted from our core.”
He wants the brand to find its way back to that core.
“Our stores have always been more than a place to get a drink,” Niccol explained. “They’ve been a gathering space, a community center where conversations are sparked, friendships form, and everyone is greeted by a welcoming barista. A visit to Starbucks is about connection and joy, and of course great coffee.”
In recent years, Starbuck’s emphasis on being a “third place” (not home or work/school) for people to gather has faded – especially during the COVID-19 pandemic, when in-person dining was often prohibited. Audacy reported in June 2022 that Howard Schultz, former interim CEO of Starbucks, said during The New York Times DealBook D.C. policy forum that the company was even considering limiting bathroom access.
While Niccol said that customers still experience some of the Starbucks “magic” every day, he also said some U.S. locations aren’t “always delivering,” their best. He said that visits to shops “can feel transactional,” and that “menus can feel overwhelming, product is inconsistent, the wait too long or the handoff too hectic.”
At the helm of the company, Niccol said his goal is “getting back to Starbucks,” and focusing on making the locations places for people to gather over handcrafted cups of high-quality coffee. Specifically, he said Starbucks will focus on improvement in four key areas: empowering baristas to take care of our customers, getting morning service right, and reestablishing Starbucks as the community coffeehouse and telling the company story.
“Our stores will be inviting places to linger, with comfortable seating, thoughtful design and a clear distinction between ‘to-go’ and ‘for-here’ service,” Niccol said.
More information about specific changes was revealed this week. For example, Starbucks announced in a Wednesday press release that will end its extra charge for customizing beverages with non-dairy milk with the rollout of its holiday menu on Nov. 7.
According to CNBC, many of the other changes Niccol revealed during the conference call this week are geared towards a specific goal – getting customized drinks to customers in under four minutes. Right now, only about half the company’s transactions meet this threshold.
To achieve the goal, and the others previously mentioned by Niccol, Starbucks is slowing down its pace of new location openings and of renovations. It also plans to streamline the mobile ordering and payment process and to slash the customization selection on its mobile menu.
Niccol acknowledged that some customers might be upset about that, but that they will come to appreciate the shorter wait times.
“There’s always a long tail on the menu, and those items, frankly, we don’t execute all that great,” he said of over-customized beverages. These types of drinks have been mocked online and even covered in this 2017 article from Vice.
As the company works on wait times, it will also focus on bringing a personal touch into the mix. This plan includes bringing back ceramic mugs for in-person hangouts and a return of the sharpie-written names on cups.
“The reality is the majority of what we have are these cafes that I think don’t have the right seats, potentially have the right texture, don’t have the right layers, don’t have the right warmth. We need to bring that back,” Niccol explained.
A win for customers will also come in the return of the condiment bars that disappeared during the COVID-19 pandemic. Niccol said this is also a win for baristas, who won’t have to waste time searching for Splenda packets while they try to make drinks.
More and more Starbucks locations have also been unionizing in recent years, and Niccol said he wants to work to improve employee schedules.
CNBC said that Starbucks has reported declining sales for three straight quarters. According to the earnings release published this week, Starbucks’ global comparable store sales have declined 7%.
“It is clear we need to fundamentally change our strategy to win back customers,” said Niccol.
Starbucks announced Aug. 13 that Niccol had been appointed as chairman and CEO of the company. That same day, Chipotle announced that Niccol would be leaving as its CEO after holding the position since 2018, and as chairman since 2020. This summer, Audacy reported on how he handled a social media trend targeting Chipotle portion sizes.
Niccol officially started his new role at Starbucks on Sept. 9.