Starbuck's (SBUX) new CEO Brian Niccol pinpoints what's currently wrong and how he plans to make it right

On the second day as the new CEO at Starbucks (SBUX), Brian Niccol pointed out some crucial issues and things that are wrong with the mega coffee chain.

In a sincere, heartfelt letter to his employees and customers, Niccol wrote:

There's a sense that we've drifted from our core... We're committed to elevating the in-store experience-making sure our space captures the sights, smells and sounds that define Starbucks."

Losing the spirit of Starbucks

Over the years, it seems that Starbucks has lost the thing that makes Starbucks; the recognisable smell of the signature Arabica coffeebeans, the Jazz music playing in the background, and the conchophony of people talking with one another; the fundamental fabric of the Starbucks experience that have slowly disappeared from the Starbucks we see today.

Losing these unique traits has caused Starbucks many of its loyal customers, and this could be clearly seen from their sales numbers. Starbucks has faced a decline in recent years, with sales dropping as customers are shifting away from the traditional sit-down coffeehouse to a more convenience-oriented model where customers order via mobile apps and pick up their drinks at the counter.

Under the leadership of its Ex-Ceo Laxman Narasimhan, the revenue of Starbucks has dropped since the first time in 2020, and its stocks has plummeted by 25%. For a company that claims to be the world's largest coffeehouse chain, this was a disaster.

Arrival of the messianic hero of Starbucks

But as soon as Laxman was out and Brian Niccol was named the new CEO, Starbuck's stock price shot up by 25%. It seems that people are very optimistic about this new CEO, for very good reasons.

Niccol, known for successfully reviving brands like Chipotle and Taco Bell, is seen as an industry "Mr. Fix-It." He becomes Starbucks’ fourth CEO in just two years, taking charge during a time when the company faces slumping sales and increasing pressure from employees and investors alike.

Niccol has announced that his transformation of Starbucks will start with a focus on comfort. So it seems that we can expect more comfortable chairs to sit on-maybe bean bag sofas instead of the traditional tables and chairs that we are so used to in the traditional Starbucks setting.

For two consecutive quarters, Starbucks has seen a decline in sales. Customers have voiced concerns over rising prices, slow pickup times through the Starbucks app, and a lack of compelling food options. Additionally, frustrations over working conditions, pay, and benefits have sparked union organizing efforts in various stores, challenging Starbucks' reputation as a progressive employer.

Starbucks has gradually transitioned from a predominantly brick-and-mortar brand to a business increasingly driven by mobile and online sales. Across the 9,500 stores located all around the U.S., more than 70% of sales come from mobile apps or drive-thru orders.

In his letter, Niccol acknowledged having visited stores recently and conversed with both employees and customers. He admitted that in some U.S. stores, the experience feels overly "transactional," with overwhelming menus, inconsistent products, long wait times, and chaotic handoffs.

To address these issues, Niccol outlined plans to empower baristas by providing them with the tools and time needed to craft high-quality drinks. Some employees have expressed concerns that an influx of mobile orders often overwhelms stores, putting strain on workers.

Niccol's unique climate solution

Niccol has also expressed his commitment to making his 1,000 mile super-commute from his home in Southern California to his office in Seattle more sustainable by using his private jet engines to roast Starbucks' coffee beans.

Niccol said in an interview that:

"I'm all about innovative climate solutions, and that's why Starbucks now has a new roastery in the sky that's offsetting a massive carbon footprint I make flying three days a week from Newport Beach to PNW."

Despite Niccol's bold, environmentally friendly strategy, some are wondering if the unprecedented roasting technique will really be all that efficient long-term.

After continuing to hear criticism from environmental activists about his corporate private jet commute even after offering his green coffee-roasting proposal, Niccol is reportedly researching for other options to make his plane ride more sustainable.