It seems Starbucks CEO Howard Schultz’s anti-Trump, 10,000-refugee-hires plan not only caused consumers to largely boycott their coffee, sales have been so bad Schultz is actually stepping down from his position. (He will stay on as executive chairman.) Company COO Kevin Johnson will assume Schultz’s position as of April 3, 2017.
YouGov BrandIndex’s Buzzscore availed Starbucks’s customer-popularity levels fell by two-thirds from January 29th to February 13th.
Upon this move, Schultz “will shift his focus to innovation, design and development of Starbucks Reserve® Roasteries around the world, expansion of the Starbucks Reserve® retail-store format and the company’s social-impact initiatives [and] focus on Starbucks’s next wave of retail innovation.”
Schultz was anything but silent when it came to having a heart in terms of managing profit margins simultaneously with being mindful of socio-economic progression. Additionally, the former CEO’s was pro-Clinton—and a well-known Democrat. There was a time he thought about being Hillary’s would-be vice president. In his letter to company employees, Schultz expressed his concern about the American Dream falling apart—that it “[was] being called into question… …the civility and human rights we have all taken for granted for so long are under attack. … The following note came from the president of Kantar Millward Brown (our long-term partner in providing brand- and consumer-equity research) clarifying current Starbucks-brand perception. Reports suggesting anything other than this should be viewed skeptically and do not reflect the customer satisfaction and perception trends we are seeing so far in 2017. … In fact, in February 2017 (after the announcement) we did not observe any substantive impact on Customer Consideration, Future Visitation Intent or Brand Perceptions or any other key-performance metrics for the Starbucks brand.”
It’s not like Schultz’s hurting over this demotion—his net worth is $3.1 billion. Even if he managed to spend all that money in one lifetime, he himself purchased and grew Starbucks into the coffee giant it is today—from four stores to 25,000 franchises globally! Ultimately, he’d think of something else to succeed in.
More, the company’s worth nearly $85 billion. While Schultz’s words caused Starbucks’s share price to decrease, it has recently increased to $55.78. Before the CEO spoke out, 30 percent of consumers were likely to buy Starbucks coffee—a YouGov spokesman said the price declined 26 percent as a result of Schultz’s public statement. “Consumer perception dropped almost immediately,” YouGov BrandIndex CEO Ted Marzilli said. He further explained the statistical decline availed people being unlikely to purchase Starbucks products. “That would indicate the announcement has had a negative impact on Starbucks and might indicate a negative impact on sales in the near term,” Marzilli added.
“We’re not just here to raise the stock price,” Schultz said in a 2016 interview with Forbes. “What can we do to use our strength for social good?”
At one point, Schultz spoke of helping on-line-degree-seeking baristas via subsidizing their tuition. Additionally, he led the effort in putting Starbucks on military bases so veterans and soldiers’ spouses could have employment.
While Schultz’s speculated, election outcome didn’t happen, The Seattle Times wrote, “[he] is definitely being pursued” for the DNC’s 2020 candidate. (Hmmm…)
In the meantime, Starbucks boycotters are pushing friends to join them in their transition to Dunkin’ Donuts. This makes for a vulnerable Starbucks. They were also part of US restaurants experiencing an overall decline in consumer traffic in the current quarter. Starbucks corporate officers explained this was due to their mobile orders getting backed up. There’ve been mobile-app-customer traffic jams at Starbucks’s pick-up counters, which deterred traditional-order folks.
Perhaps Starbucks is simply biting off more than they can figuratively chew?