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What happens when a guy with a tech background gets put on the coffee beat?
Starbucks President and COO Kevin Johnson — who worked at Microsoft for 16 years — will now become its CEO, with founder Howard Schultz stepping out of the role.
Johnson joined us to talk about Starbucks’ recent tech deals, uncertainty in the economy, and how he and Schultz will handle the leadership changes.
On Starbucks’ new deal with Tencent and the message service WeChat, which will enable users to give Starbucks products as gifts:
There’s this seismic shift in consumer retail behavior to move online. And so what we have done is work to extend the experience in store to a digital experience. And with our mobile app and mobile payments and the ability to do mobile order and pay, we now have millions and millions of customers using that mobile app. So in many ways, this is just a logical extension of the digital experience that we have created for our customers.
On how online shopping and a decline in mall traffic is affecting Starbucks:
Fortunately for Starbucks, we are and have always been a destination and that is serving us well, even as this transition is unfolding in the retail sector. ..It’s clear that the traffic in malls is down. You know there’s fewer people in the mall — that’s gonna create fewer people that want to go to Starbucks in the mall. Fortunately, the vast majority of our stores are not in the malls. We’ve always architected the strategy to be a destination.
On his relationship with Schultz:
Well, Howard and I have worked together now nearly a decade. Our offices are connected by a door. We talk to each other three, four, five times a day. The fact that he is stepping into the executive chairman role to focus his energy, and his creativity and his passion on these very high end ultra-premium roasteries and reserve store experiences, and I will take over the responsibilities of CEO, I don’t think that changes how we work. We have great respect for one another. We know how to work together. And…in my opinion this is probably gonna be one of the smoother, more thoughtful CEO transitions that has probably ever happened.
Listen to our recent interview with Starbucks CEO Howard Schultz here.
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