Starbucks CEO Howard Schultz to Step Down
Schultz, who will remain at the company as executive chairman, will be succeeded by current president and chief operating officer Kevin Johnson.
Starbucks' Howard Schultz is stepping down as CEO from the business he transformed into the world's largest coffee brand over the past 30 years.
Schultz made the announcement Thursday, saying he will make the transition on April 3 and remain at the company as executive chairman.
Since purchasing the Starbucks chain in 1987, Schultz built the brand's empire with more than 25,000 stores in 75 countries and a market value of $84 billion, according to The New York Times. Schultz has been a highly visible CEO while leading the company to take on social and political issues such as gun violence, race relations, gay rights, student debt, veterans rights and more.
His successor will be Kevin Johnson, the company's current president and chief operating officer.
Schultz said he plans to continue to lead Starbucks' social efforts while focusing on developing its higher-end shops, such as the 15,000-square-foot flagship Reserve Roastery in downtown Seattle, as well as smaller premium stores and "bars" in current Starbucks stores. Schultz's move is sure to feed speculation that he has plans to enter politics, though he has said that is not in his current plans.
Under Schultz's direction, Starbucks has not only grown as a coffee brand but a powerful player in music. The company's investment began with the acquisition of music retailer Hear Music in 1999, initially focusing on compilations for music discovery sold in its coffee shops.
In the mid-2000s, the company developed a partnership with William Morris to help identify music to feature in its stores and Schultz helped bring in a number of exclusive music releases under the Hear Music record label in partnership with Concord Music Group. This incentive included albums by Paul McCartney, Joni Mitchell, Sia, Elvis Costello, James Taylor and more.
Hear Music also developed into a branded retail store with several Starbucks Hear Music Coffeehouses around the country, as well as "media bars" within existing Starbucks locations.
A 2006 Billboard article cites annual album sales of 3.6 million units, or approximately $65 million in music revenue, via Starbucks.
In a 2004 interview with Fast Company, Schultz noted of Starbucks' jump into music: "The nature of shopping for a CD or a piece of music at a traditional record store is, at its best, a very poor consumer experience. ... The Starbucks customer [who] might want to find a Diana Krall album, a Tony Bennett album, or anything that was not being played on the radio, well, they would have a hard time going into Tower Records. Maybe they'd find the album there, but they could not find someone who could talk to them about it. That consumer has disposable income and has had a long history of buying and enjoying music, but they have nowhere to go."
The Hear Music Coffeehouses shut down in 2008, as the company transferred the record label's day-to-day management fully to Concord that same year. And in 2015, the Starbucks coffee shops stopped selling CDs but has continued its music efforts, this year announcing a partnership with Spotify.
This story originally appeared on Billboard.com.