Can Starbucks' new CEO revive the company?
Brian Niccol has been the CEO of Chipotle since 2018 but is now moving to the coffee chain
![Illustration of Starbucks CEO Brian Niccol with coffee beans](https://cdn.mos.cms.futurecdn.net/LDX997tVng8LMxDVtTgGhn-415-80.jpg)
Just in time for pumpkin spice latte season, Starbucks is getting a new chief executive. The coffeehouse announced that Brian Niccol will become the new CEO of the Seattle-based company. Niccol, who has been the CEO and chair of Mexican fast-food chain Chipotle since 2018, will take over at Starbucks on Sept. 9.
Niccol will replace Laxman Narasimhan, who joined Starbucks in 2022 and served as CEO starting in 2023. In his new role, Niccol will bring a "wealth of experience and a proven track record of driving innovation and growth," Mellody Hobson, the lead independent director of Starbucks' board, said in a press release. The transition comes as the world's largest coffeehouse faces an uphill battle; Starbucks has seen two straight quarters of declining same-store sales and the company's overall revenue declined in Q1 this year for the first time since 2020. But Niccol had significant success at Chipotle, and some are hoping he will be able to translate that success to the coffee world.
What did the commentators say?
All food service companies have faced recent challenges, but unlike Narasimhan, who was often criticized as "moving too slowly with his turnaround plans for Starbucks," Niccol is "expected to hit the ground running with a track record of matching fast food sector challenges," said Jeffrey Sonnenfeld, Stephen Henriques and Steven Tian at Fortune. Niccol's "approach to rebranding, defined by premiumization and growth-focused marketing, is the opposite of Narasimhan's."
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While at Chipotle, Niccol helped "highlight the premium-quality freshness of the chain's 'food with integrity,'" which was a shift from the company's prior CEOs, said Sonnenfeld, Henriques and Tian. Taking this "approach to Starbucks would match investors' hopes of a premiumization-based turnaround," and it is why "Niccol may well be the messiah Starbucks" has needed.
Starbucks is also notably replacing Narasimhan "with a leader who has a resume filled with food industry experience," said Alex Halverson for The Seattle Times. Narasimhan, on the other hand, required on-the-job chief executive training upon taking over at Starbucks, but it "appears Niccol won't go through six months of CEO-shadowing and barista training," which could also help him in the transition.
Beyond the customers and the C-suite executives themselves, Wall Street "believes Brian Niccol is the right choice to turn around Starbucks — and move the chain past the decadeslong Howard Schultz era," said Amelia Lucas for CNBC. Though Schultz, the CEO before Narasimhan, stepped away from the company in 2023, he ran Starbucks on-and-off for years, and had a "huge influence over the company he turned into a global coffee giant." Schultz did step back into the role twice "when sales turned sluggish," but his "last return sparked concerns about the company's succession." But "having Niccol, an experienced restaurant CEO, in the driver's seat could mean that Schultz finally moves on."
What next?
There are still challenges for Starbucks — and for Niccol, as "Starbucks is a much more complicated model than Chipotle, with company and licensed stores, domestic and international locations, and a significant presence in struggling China," BTIG analyst Peter Saleh said in a financial analysis, per CNBC. Beyond this, Chipotle has a "relatively small international footprint, although Niccol has been pushing to grow its presence outside the U.S. in recent years," said CNBC, while Starbucks has a significant number of locations around the globe.
And "once the initial excitement fades, Niccol will face the realities of the significant issues Starbucks must address," said Forbes. Niccol's "primary challenge will be revamping and reconnecting the customer experience," but "while surface-level tactics can improve the customer experience, they still require fundamental improvements foundationally, beginning with employee well-being." Even as Starbucks continues to try and claw back, Niccol must realize that "revitalizing company growth, sales, and customer experience is not an overnight endeavor." To work to "recapture the brand's former glory, reinvigorating the people within the organization must be the top priority, starting with their well-being."
Niccol himself said he is up to these challenges. He has "long-admired Starbucks iconic brand, unique culture and commitment to enhancing human connections around the globe," Niccol said in Starbucks' press release, and is "energized by the tremendous potential to drive growth and further enhance the Starbucks experience."
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Justin Klawans has worked as a staff writer at The Week since 2022. He began his career covering local news before joining Newsweek as a breaking news reporter, where he wrote about politics, national and global affairs, business, crime, sports, film, television and other Hollywood news. Justin has also freelanced for outlets including Collider and United Press International.
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