In 2018, Chipotle faced a series of challenges including food safety fears, messy restaurants, and new menu items that weren’t resonating with customers. Brian Niccol, known for leading a successful turnaround at Taco Bell, was brought in to solve these issues. Niccol implemented advertising, new menu additions like quesadillas and carne asada, and digital and drive-thru ordering to position Chipotle as upscale fast food. As a result, Chipotle’s revenue has surged over 800% in the past five years, with sales increasing 11% last quarter.
Niccol has now been appointed as the new CEO of Starbucks, following a slump in the coffee chain’s business and pressure from employees and investors. Investors reacted positively to the news, causing Starbucks’ stock to rise while Chipotle’s fell. Analysts have drawn parallels between Chipotle in 2018 and Starbucks at present, attributing Chipotle’s success to offering good value for the price compared to Starbucks’ perceived high prices and lackluster offerings.
Starbucks has experienced declining sales for two consecutive quarters, with customers voicing complaints about high prices, slow app orders, and subpar food options. The company has also faced challenges related to employee dissatisfaction and union organizing. Niccol is expected to focus on improving in-store operations, advertising, and returning Starbucks to its roots as a cool coffee shop and cafe with personality and energy. He will also need to address the shift to online-driven business and increased competition from drive-thru chains and boutique coffee shops.
While Niccol has not announced specific strategies for Starbucks, experts predict he will aim to re-engage lost customers and attract new ones through improved operations and advertising. He is also expected to introduce new menu options and focus on brand image and perception. As Starbucks transitions to a more online-focused business, Niccol will need to navigate the changing landscape of the coffee industry, including increased competition and changing consumer preferences.
Niccol’s marketing background was key to Chipotle’s success, and analysts anticipate he will utilize similar strategies at Starbucks to generate brand buzz and improve customer perceptions. The introduction of new drink options and menu innovations are expected to draw customers back to Starbucks stores. Despite the challenges facing Starbucks, Niccol’s track record of success at Chipotle has instilled confidence in investors and analysts, who believe he has the skills to lead Starbucks in a successful turnaround.
