Starbucks CEO unveils plan to keep customers in stores longer

New Starbucks CEO not required to move to Seattle

Starbucks' incoming CEO could make well in excess of $100 million in his first year with the company under an incentive-laden contract, and he will not be required to relocate to Seattle.

Starbucks’ new chairman and CEO said Tuesday that he plans to focus on improving service – particularly during the morning rush – and reestablishing stores as gathering places as he takes over at the struggling coffee giant.

In an open letter on the Seattle coffee giant's website, Brian Niccol said Starbucks is a beloved brand but that he found during conversations with employees and customers over the past few weeks a "shared sense that we have drifted from our core."

Starbucks' sales have fallen this year due to weaker U.S. store traffic and other issues, including rising competition in China and boycotts in the Middle East. Niccol said improving the store experience for both baristas and customers will help turn that around.

"Many of our customers still experience this magic every day, but in some places — especially in the U.S. — we aren’t always delivering," said Niccol, who was named Starbucks' CEO in August but officially started the job on Monday. "It can feel transactional, menus can feel overwhelming, product is inconsistent, the wait too long or the handoff too hectic. These moments are opportunities for us to do better."

Niccol, who was the CEO of Chipotle before coming to Starbucks, said the company "founded on a love for high quality coffee" needs to make sure baristas have the proper tools and time to make drinks and personally deliver them to customers.

A rise in different channels -- like mobile, drive thru and delivery, which now make up 75% of orders -- has made store operations more complex and added to wait times. Store design should acknowledge that change and make a clear distinction between "to-go" orders and in-store service, and stores should be an inviting place to linger with comfortable seating, he said.

Niccol also said Starbucks needs to ensure it’s meeting the needs of morning customers.

"This means delivering outstanding drinks and food, on time, every time," Niccol said.

Coffee is the heart of the company, Niccol said, and Starbucks' marketing should remind customers of its coffee expertise. That may have been a subtle dig at recent product introductions at Starbucks, including bubble tea and energy drinks.

Niccol said he plans to spend his first 100 days in Starbucks' stores and support centers and meeting with suppliers.