Starbucks’s CEO announces a huge change to win back customers

When Howard Schultz joined—and later acquired—Starbucks in the 1980s, he was deeply inspired by the communal culture of Italian coffee bars. From the beginning, Schultz envisioned Starbucks as more than a transactional stop for coffee. He wanted to build a community-centered space for people to congregate and connect. That vision helped redefine what a coffee shop could be. In recent years, however, that vision has lost momentum.  

Shifts in how and where people work, rising costs, and intensifying competition have challenged Starbucks’s dominance in the coffee shop landscape. In New York City, the company recently lost its position as the city’s largest coffee chain to Dunkin’, according to a report from the Center for an Urban Future.  

Starbucks has since closed 42 stores in the city—roughly 12% of its New York locations—as part of a broader $1 billion restructuring plan that shuttered 400 metropolitan stores nationwide. The company that once felt like it occupied every corner is now becoming more selective with its presence.  

As part of that reset, CEO Brian Niccol, former CEO of Chipotle and Taco Bell, is attempting to reestablish Starbucks as a true “third place,” distinct from both home and work. “The third place is not something we need to reinvent—it’s who we are,” Schultz said at the Starbucks Leadership Experience 2025.  

The strategy, branded “Back to Starbucks,” calls for a shift away from the grab-and-go model that has dominated in recent years and toward a more inviting in-store experience “with comfy chairs, couches, and power outlets,” according to a CNN report. Starbucks plans to renovate 1,000 U.S. stores—about 10% of its domestic locations—as part of the effort.  

As Niccol pushes to restore the brand’s “third place” ethos, Starbucks is betting that customers still want a place to stay, not just a place to order, in a market increasingly built around speed, convenience, and efficiency.  

—By Leila Sheridan

This article originally appeared on Fast Company’s sister website, Inc.com.

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