Starbucks appoints interim CEO, will new CEO Niccol revive NFT and Metaverse plans?

The global leading chain of coffee shops, Starbucks, is facing slowing sales, plummeting stock prices, and unrest among activist investors. On August 13th, they suddenly announced the removal of CEO Laxman Narasimhan and his replacement with Brian Niccol, the CEO of Mexican burrito company Chipotle.

The Legend in the Food Industry

According to The New York Times, in recent years, Niccol has become one of the top restaurant leaders in the industry. He spent about three years in senior positions at Taco Bell, a subsidiary of Yum! Brands, before taking over as CEO of Chipotle in early 2018. Under his leadership, Chipotle has continued to grow and successfully navigated through the challenges of the pandemic. Chipotle's stock price has soared from around $6 in 2018 to recent highs of over $65 this summer.

Meanwhile, Starbucks' stock price has only increased from $60 to $80 during the same period. Following the news, Starbucks surged more than 20%, while Chipotle fell nearly 12%.

However, Starbucks boasts an annual revenue of over $36 billion and has 38,000 stores in more than 80 countries, far surpassing Chipotle's annual revenue of $10 billion and 3,500 restaurants, primarily in the U.S.

Starbucks Offers High Salary to Attract Brian Niccol

According to CNBC, Niccol will officially take over Starbucks on September 9. He will receive a $10 million cash bonus and $75 million in stock awards to compensate for the incentives he lost when leaving the burrito chain Chipotle. The stock awards will vest over three to four years based on the company's performance and Niccol's tenure.

Upon joining Starbucks, Niccol will receive a base salary of $1.6 million annually, with the potential to earn up to $7.2 million in cash and up to $23 million in annual stock awards. If all targets are met, his total compensation in the first year could reach $116.8 million.

Niccol received a base salary of $1.3 million last year, with total compensation of $22.5 million. Stock awards and options accounted for a significant portion of his income, in addition to a $5.2 million cash bonus.

Will Chipotle's Metaverse Strategy Be Transferred to Starbucks?

In 2021, Chipotle launched a modular world strategy on the gaming platform Roblox. Fans could visit Chipotle's first restaurant in the metaverse, don 90s-style uniforms, and unlock new virtual items inspired by 90s fashion, such as the Chipotle Pepper tie-dye shirt.

In April 2022, Chipotle introduced Chipotle Burrito Builder, allowing players to experience making Mexican burritos in the metaverse, earning burrito coins, which they could redeem for burritos or other main dishes through the Chipotle app or website.

On the other hand, Starbucks announced in March this year that its program allowing customers to earn and purchase digital collectibles through non-fungible tokens (NFTs) is coming to an end. There is much anticipation about whether the new CEO will revive NFT or metaverse-related initiatives.

Starbucks Abruptly Ends NFT Rewards Program: Preparing for Next Phase of Plans