New Starbucks CEO Brian Niccol lays out vision for success

Brian Niccol officially started his role as Starbucks's (SBUX) new CEO this week. Yahoo Finance Senior Reporter Brooke DiPalma joins Catalysts to discuss Niccol's vision for the company as it struggles with weak sales and how his experience as Chipotle's (CMG) CEO could influence the direction of the coffee chain.

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This post was written by Melanie Riehl

Video transcript

Let's take a look at Starbucks, the new Ceo Brian Nichol officially starting his role this week.

In an open letter, he outlined his vision for the company and how he plans to spend his time addressing some of those key issues that Yahoo Finance's Brooke Dipalma has been closely tracking for us.

Hey, bro, good morning to you both.

That's right.

Brian Nickel coming out this letter, it's called back to Starbucks.

And what he's really looking at here is getting that business back to the core, back to the coffee that it's known for in this open letter.

He said that he's been a long time customer and since his announcement was made in mid August, he has been spending time in stores as well as with employees, but he was not shy to immediately jump into the key issues that the coffee chain faces in the open letter.

He said that there's been inconsistent product that wait times has been too long or the handoff from uh the barista to the customer has just been too hectic.

He also said that the company to elevate the in store experience, they want to move back to that.

Well, he didn't say exactly, but it really sounds like that third place that founder Howard Schultz really envisioned a comfortable place for people to go and grab Starbucks, hang out and, and do homework.

Uh Essentially, uh they said they also want to identify where is a clear place to pick up those mobile orders.

Often, analysts have pointed out that it's confusing for consumers when they walk in and they want to grab that star where they should go.

And if their order is ready or not, in addition to that, Brian Nichol, really looking to implement key strategies that were successful at Chipotle when it comes to partner, what Starbucks calls its employees relationships, really looking to provide career opportunities and a place to grow.

We know that retention as well as the relationship overall between leadership and its employees has been a bit of a 10 point over the past few years and these were awfully similar to what we heard from former three time founder and Ceo Howard Schultz back in May when he said that the issues in the US need to be fixed first, there needed to be an overhaul of the current strategy and need to go back to coffee forward innovations.

Of course, Brian Nichol, he's known to introduce throughput.

He had a dual sided grill at Chipotle.

He hinted at investing in technology at Starbucks.

But when you think about store count for to pull late to Starbucks, this is a much bigger playbook that he's now in Bump that Brooke.

Look at the end of the day.

I just wanna hear more about the unicorn Frap.

Like you could easily come out and say, you know what we're gonna lean into, like the whole barbie cation of drinks that we had seen over the past couple of years now.

And I know that's kind of fading here a little bit and Corp core.

I think that's the new thing.

But at the end of the day, I wanna hear more about where they're expanding beyond coffee.

It's good.

I just look back the unicorn frap.

I wanna see that.

I wanna see um you know, the answers to Starbucks easily could have won me over with that.

I also think that look in other times of the day because you have people spending more time there to study more time there.

Perhaps in the later evening, the day part has been something that has been for them.

But also too, when you think about Brian Nichols, he, his uh key advantage here is that he is a marketer at heart and that's something that Starbucks has thrown all these new instructions, the boba and the energy drinks and the lavender.

And when I spoke to one analyst, they were saying, hey, were the products good?

Yeah.

Did they market them?

Well, no.

So people didn't really know about them.

They weren't really enticed to go.

We know that this is Brian Nichols, Strong's food.

He knows how to get people in the door.

He's good with LT OS the limited time off.

Very good.

Yeah, we'll see how that comes to fruition.

Maybe some unicorn wraps Brooke Dipalma.

Thanks so much.

Appreciate it.