Starbucks CEO says strategy will include refocusing on community coffeehouse vibe

Starbucks Corporation (NASDAQ:SBUX) CEO Brian Niccol made it clear on his second official day on the job what his priorities are in transforming the coffee chain. “We’re getting back to Starbucks,” he stated in a letter to employees. He wants the company to refocus on what has always set Starbucks apart — a welcoming coffeehouse where people gather, and where we serve the finest coffee, handcrafted by our skilled baristas.

Niccol said that during his first 100 days he will spend time in stores and at the company’s Support Centers, meeting with key partners and suppliers, and working with his team to drive critical first steps. He said the key areas of focus that will have the biggest impact are empowering baristas to take care of customers, getting the morning daypart right, and reestablishing Starbucks as the community coffeehouse. “Our stores will be inviting places to linger, with comfortable seating, thoughtful design and a clear distinction between to-go and for-here service,” he highlighted.

Barnes & Noble and independent coffeehouses have been partially fulfilling a post-pandemic void that Starbucks’ (SBUX) former CEO Howard Schultz and the company’s marketing described as the “Third Place” or the space that is neither home nor work, but a welcoming environment where individuals can relax, connect, and enjoy the Starbucks experience. While Schultz hammered away at that concept as a top priority for years, Starbucks (SBUX) decided to move away from its “Third Place” business model in 2022 to emphasize drive-thru, pick-up, and delivery options. This led to many Starbucks (SBUX) being overwhelmed with mobile pickup traffic and some customer dissatisfaction.

Starbucks (SBUX) is up 19% over the last six weeks as investors have bet on the chain’s ability to return positive comparable sales growth. On Seeking Alpha, bulls and bears have been hashing it out on if a turnaround is likely.