The Free Ride is Over: Starbucks Wants to Charge You Even More for Your Coffee Fix...(Thanks, Brian)

It’s time to face the music, Starbucks lovers — all those sweet BOGO deals and 50% off promos are about to be taken behind the barn and shot. Yep, Starbucks is scaling back on discounts, and just like that, my wife will soon be paying full price for her iced caramel macchiato. Thaaaanks Brian Niccol, I appreciate it. 

(Source: Giphy) 

Now in case you missed the CEO swap epidemic that swept through corporate America this year, Brian Niccol is the saving grace Starbucks brought in after an atrocious decline - and as expected, he’s shaking things up… starting with his customers' own happiness.  

(Source: New York Post) 

You see, Niccol, who took over in September, has made it clear: Starbucks wants to be your community coffeehouse again, not a discount emporium. So, no more chasing loyalty points or waiting for that “half-off Frappuccino Friday” notification to hit your app. And while that may piss off consumers, it’s actually a good thing for investors. Why?

Well because, this is the same guy who turned Chipotle around, and right now he’s steering Starbucks back to its roots of selling premium, handcrafted coffee — where every white girl in America is going to pay for it… and they're going to like it too. 

Which makes sense considering for the past year, Starbucks leaned heavily into promotions to lure back customers who were feeling the pinch of inflation. Which, let’s be honest, when your grande Pumpkin Spice Latte in Chicago costs $6.25 (and nearly $10 if you're feeling extra with syrups and flavors), a little price break goes a long way. But that’s exactly what Niccol is saying goodbye to. The company is scaling back on the flood of offers that had been rolling out through the Starbucks app, because — surprise — all those promos were wreaking havoc on store operations.

Baristas and managers have been juggling unpredictable customer surges when deals dropped, making it hard to keep things running smoothly. And yeah, nothing says “premium experience” like waiting 20 minutes for your latte because the entire city showed up for 50% off iced drinks.

(Source: Giphy) 

Now with that said, in September, Starbucks shifted to offering extra loyalty points on Tuesdays and deals on Saturdays, but that’s a far cry from the BOGOs and deep discounts that were plastered all over your app earlier this year. Simply put, Niccol’s vision for Starbucks is simple: fewer discounts, better service, and an overall elevated in-store experience. He’s already made some big moves, including shaking up the leadership team and cutting back on roles created by the previous CEO, Laxman Narasimhan, who, let’s just say, didn’t have the smoothest ride at Starbucks. Meaning, Niccol is laser-focused on making the cafes more efficient and restoring Starbucks to its former premium glory. 

(Source: CNN) 

Plus as part of this reset, he’s making a big push to improve the in-store experience. Think comfy seats, the smell of fresh coffee, and a clear distinction between your to-go orders and those times when you want to sit down, sip, and actually enjoy your $7 latte. Niccol is all about getting back to that “community coffeehouse” vibe that Starbucks was once known for.

But hey, the Starbuck “vibe” doesn’t come cheap. With revenues slipping and sales down for two straight quarters, Starbucks has decided it’s time to stop trying to serenade customers with discounts. Instead, they’re betting that you’ll still show up for your daily fix — even if it costs a little more.

So the takeaway here? Well, expect Starbucks to be even more expensive going forward while aiming to provide better service with a more polished cafe experience will make that extra couple of bucks worth it. Meaning for investors, we could be looking at a streak of better earnings numbers going forward. 

(Source: Giphy) 

Of course, only time will tell how much of an impact Brian Niccols buzzkill will be for the companies financials, but in the meantime, at least we know the man is doing the job he’s supposed to be doing: Rewriting his predecessors wrongs and f***ing ‘ish up in the process. 

In the meantime, keep an eye on Starbucks going forward and as always stay safe and stay frosty, friends! Until next time… 

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Stocks.News holds positions in Starbucks as mentioned in the article.