On March 16, Starbucks announced that its current president and CEO, Kevin Johnson, will retire. He will hand over on April 4 and will continue to serve as special advisor to the company and the board until September of this year.
Kevin Johnson has been with Starbucks for 13 years, and in 2015 he was named president and chief operating officer (COO), followed by Starbucks founder Howard Schultz on April 3, 2017 Ended the CEO tenure and began to fade out of the company, and the CEO was succeeded by Kevin Johnson.
Kevin Johnson (left) and Howard Schultz
It is worth noting that Starbucks does not currently have a CEO-designate. The announcement mentioned that it will be returned by Howard Schultz, who will work as interim CEO from April 4 until a permanent successor is determined. He will also rejoin the company’s board of directors, and his salary at the company is only a nominal $1.
The announcement said that the selection of a new CEO is underway and “expected to be completed by the fall of this year.”
Kevin Johnson, who was born in 1960, will turn 62 this year, an age that, by executive standards, looks more like a new challenge. The “successor” Howard Schultz was born in 1953 and is almost 70 years old.
Kevin Johnson said he considered retiring from Starbucks a year ago when “the global pandemic neared an end”. Melody Hobson, non-executive chairman of the Starbucks board of directors, also mentioned that he would like to thank Kevin Johnson’s leadership team for their efforts in responding to the global epidemic, which is “one of the most difficult times in modern history.”
Kevin Johnson has fully led Starbucks for 5 years (including more than 2 years in response to the epidemic), and the performance of Starbucks is not bad. Kevin Johnson served as an executive as a reformer who promoted new technologies. During his tenure, Starbucks really promoted digitalization, and more digital products were introduced to the nearly 45 million Starbucks Rewards members in important markets such as China and the United States.
In addition, during the tenure of Kevin Johnson, Starbucks opened 5 roasting workshops (Shanghai, Milan, New York, Tokyo, Chicago), comprehensively promoted employee care and welfare, and worked hard to promote sustainability (such as eliminating plastic straws, etc.), Starbucks has also formed a “Global Coffee Alliance” with Nestlé, allowing Starbucks products to be sold in nearly 80 markets through Nestlé’s channels.
Starbucks Shanghai Roastery on opening day, December 6, 2017
The new CEO has not been determined, and the return of Howard Schultz is logical, and this is not the first time he has returned – Starbucks was in trouble during the financial crisis in 2008, and it was Howard Schultz, who had left office for 8 years. Return to lead the company out of trouble. No one worries about founder accountability.
However, times have changed. For companies at this stage, it is still not a normal thing for founders to “fight out fires”. Although Starbucks’ stock price rose by more than 7% after the announcement, and the market expressed its expectation for the return of the soul, the bigger problem of Starbucks is the pressure of performance growth.
According to the latest data, Starbucks’ revenue in the first quarter of fiscal 2022 increased by 19%, and the same-store sales in the United States increased by 18% year-on-year, but the data in the international market fell significantly: international same-store sales fell by 3%, especially as the second largest brand. In China, Starbucks’ same-store sales fell by as much as 14% this quarter.
In addition to rising prices, the emergence of new brands on the same track, and frequent appearances in various social news, Starbucks needs to find new ways to communicate with the Chinese market (of course, Howard Schultz is also famous for his emphasis on the Chinese market. ).
Before that, on October 1 last year, Leo Tsoi had replaced Wang Jingying as the CEO of Starbucks China (Wang Jingying continued to serve as the chairman of Starbucks China, focusing on Starbucks’ future long-term development strategy, innovation and enhancing social influence in China. ). From this point of view, within half a year, Starbucks has completed the coaching change in the two major markets of China and the United States.