Starbucks has appointed Brian Niccol, the former Chief Marketing Officer (CMO) of Pizza Hut and Taco Bell, as its new CEO.
This change comes as the coffee chain seeks to address recent sales challenges. Niccol replaces Laxman Narasimhan, who was dismissed following disappointing financial results.
Niccol, who has been a CEO at Taco Bell and Chipotle, originally trained as a marketer. Before his executive roles, he worked in brand management at Procter & Gamble and held key positions at Yum! Brands, including CMO of Pizza Hut and chief marketing and innovation officer at Taco Bell.
Starbucks highlighted Niccol’s experience in people management, brand development, menu innovation, operational excellence, and digital transformation. Under Niccol’s leadership at Chipotle, the company saw its revenue nearly double, profits increase nearly sevenfold, and its stock price rise by almost 800%.
Mellody Hobson, Chair of Starbucks’ Board, praised Niccol’s achievements. “Brian’s impressive career reflects his ability to drive innovation and growth. He understands that a great customer experience starts with an exceptional partner experience,” Hobson said.
Can Niccol Revitalize Starbucks?
Starbucks’ recent financial results have raised concerns. Revenue fell by 4% in the third quarter, following a 3% decline in the second quarter. This is a significant drop for a brand that saw an 11.5% revenue increase for the full year in 2023.
Despite these issues, Narasimhan expressed confidence in the company’s three-part action plan, which he said was starting to drive improvements. “Our focus on innovation and execution is enhancing our capabilities and steering the business toward sustainable growth,” Narasimhan stated.
In March, Starbucks restructured its global marketing strategy by eliminating the CMO role and promoting Brady Brewer to CEO of its international business. Instead of a central CMO, the company appointed regional CEOs to oversee localized marketing efforts as part of its “Triple Shot with Two Pumps” plan for global expansion.
Narasimhan also emphasized the need for organizational realignment to enhance geographical focus and invest in functional capabilities for scaling globally, aiming to boost productivity and rejuvenate company culture.
Starbucks has also faced external pressures, including calls for a boycott after suing its workers’ union over a social media post supporting Palestinians. The company responded by condemning violence and clarifying that it had not supported any government or military operations.