Starbucks CEO Kevin Johnson likes to talk about the company’s “innovation strategy” to accelerate its next wave of growth.
The Seattle-based coffee giant plans to increase digital engagement with its customers, expand further in China, and leverage the Starbucks Reserve brand as the company’s “innovation lab for the future,” Johnson told shareholders at the company’s annual meeting last month.
“No retailer is better positioned to meet the changing needs of today’s consumer, as expectations of convenience and community redefine what it takes to be a successful and relevant brand,” Johnson said. “The story of our growth over the past five years is grounded in key innovation investments we have been making for our future, and this continued focus will ensure we build upon on our leadership position in this rapidly changing retail environment.”
To increase digital engagement, Starbucks is opening its app’s mobile-order-and-pay capabilities to non-Starbucks Rewards members, and will also launch a series of targeted digital marketing campaigns to bring customers into the stores more often.
The company continues to expand in China, and remains on track to open more than 5,000 stores in that country by 2021. Starbucks will also expand its Reserve Roastery store locations, centered around its small-lot coffee, immersive retail experiences and Italian artisan food by Princi.
The company also has plans to bring standalone Princi stores to Seattle, Chicago, New York and Shanghai and will open Roasteries in Milan and New York later this year, in addition to Tokyo and Chicago in 2019. Over time, Starbucks premium store segmentation will include more Starbucks Reserve Roasteries and up to 1,000 Reserve stores, and 20 percent of the Starbucks store portfolio will become Starbucks Reserve bar locations.
“The Starbucks Reserve brand represents the pinnacle of coffee theater and passion, serving as inspiration to the entire organization,” Johnson said. “As these store innovations become refined, customers can expect to see an evolution of our innovation through our broader store portfolio, elevating the entire premium experience for Starbucks and the coffee industry.”
The CEO also reaffirmed the company’s commitment to a number of social impact initiatives, including Starbucks’ goal for 100 percent gender pay equity in all company-operated markets globally. The company has already achieved 100 percent gender pay equity in the U.S.
Johnson first joined the company in 2009 as a board director, and in March 2015, left his job as CEO of Juniper Networks to take on the role of Starbucks’ president and chief operating officer. He assumed the role of president and CEO in April 2017, as founder Howard Schultz transitioned into the role of executive chairman.
“Howard and I are two different people,” Johnson told attendees of the 2017 Fast Company Innovation Festival. “I’ve got 32 years in tech. He’s got decades as a retail merchant. It’s a very complementary relationship. My office is connected to his by a little door—not a little door; it’s actually a pretty big door. Every once in a while he opens that door and he sticks his head in and he says, ‘Kevin, what are you doing?’ ‘Well, I’m just sitting here working, Howard. What are you doing?’ And I know that we are about to go on some wonderful adventure together.”
He’s No. 130 on Chief Executive and RHR International’s CEO1000 Tracker, a ranking of the top 1,000 public/private companies.
Kevin Johnson, President & CEO, Starbucks
Headquarters: Seattle, Washington
Education: New Mexico State University (Bachelor’s degree, business administration)
First joined company: 2009
First positions with company: Board of directors, president, chief operating officer
Named CEO: 2017