Stacey Widlitz, founder of SW Retail Advisors, analyzes why Starbucks' stock price is soaring after announcing a new CEO on “Craman Countdown.''
Starbucks CEO Brian Nicol said the company plans to simplify its menu and revise its pricing strategy to win back customers and reverse declining sales.
Nicol, who left Chipotle in August to lead the coffee giant, said in a video message Tuesday that customers are coming to its stores less frequently and that its fourth-quarter results “speak for themselves.”
“Welcoming all customers and returning to growth requires a fundamental shift in our recent strategy,” Nicol said, adding that the plan includes “simplifying overly complex menus and revising our pricing structure. “This includes efforts to ensure that all customers can use the service with peace of mind.” I feel like Starbucks is worth it. ”
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Nicol also said the company, which has faced years of pressure to unionize, needs to address store staffing as well as eliminate bottlenecks and “simplify life” for baristas. I admitted it.
Starbucks CEO Brian Nicol said in a video message Tuesday that customers are visiting stores less frequently and that the company's fourth-quarter results “speak for themselves.” (Alexander Kalka/NurPhoto via Getty Images/Getty Images)
He also acknowledged that the company has been focusing on Starbucks Rewards customers rather than all customers, saying this is “fundamentally changing our marketing.”
Nicol said the company will also focus on improving its mobile ordering and payment operations “so that it doesn't overwhelm the cafe experience.”
“We know how to make these improvements, and we know that if we do them, our customers will come back more often,” he said.
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The company reported a 7% decline in stores open for at least a year in the three months ending Sept. 29.
Brian Nicol, CEO of Starbucks. (Robin Merchant/Getty Images/Getty Images)
The company said in its preliminary earnings release that the results were “driven by weaker North American sales in the quarter.” Specifically in the US, same-store sales declined 6% and comparable transactions declined 10%.
Nicol took over last month, starting with initial steps to rebuild the U.S. business, including making stores more comfortable for customers, improving in-store efficiency and improving employee morale. He announced that he would lay the foundations in the first 100 days. .
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One of the key areas of focus, he previously noted, is ensuring drinks and food are made “on time.” Stores will become more attractive.
His goal is to create more comfortable seating, help people stay longer, and make it easier to differentiate between “to” and “to” services.
