Starbucks to close more than 8,000 stores for racial-bias training
Starbucks is plowing ahead with its crisis response—and being applauded for
On Tuesday, the coffee chain announced that on the afternoon of May 29,
it’s shutting down more than 8,000 stores in the United States for
The move follows
both a written and video apology given by the company’s chiefexecutive, Kevin Johnson, after two black men were arrested in one of Starbucks’ Philadelphia
locations. The video of the arrests went viral last week, and the company
has been in crisis mode since then.
The closures affect company-owned locations, which account for more than
half of all Starbucks stores nationwide. Nearly 175,000 employees will go
through the training.
That could set back the company, which booked $22.4 billion in revenue last
year, a mere $16.7 million in lost sales, according to Bloomberg
Starbucks said the training curriculum planned for its employees next month
will be developed with input from national and local experts on confronting
racial bias. They include Bryan Stevenson, founder and executive director
of the Equal Justice Initiative; Sherrilyn Ifill, president and
director-counsel of the NAACP Legal Defense and Education Fund; former U.S.
attorney general Eric H. Holder Jr.; Heather McGhee, president of policy
center Demos; and Jonathan Greenblatt, chief executive of the
Starbucks’ shares haven’t seen much of an effect, but the company has
called the arrests a “reprehensible outcome” and vowed to do better. The
gesture may also not affect too many customers on the day seeking a blonde
espresso or caramel macchiato, though: About 41 percent of locations aren’t
Starbucks-owned and may still remain open.
The training announcement is just the latest in a series of steps Starbucks
is rolling out to repair its image.
CNN Money reported:
Johnson … said on Monday that he wanted to apologize to the men in person.
“I’d like to have a dialogue with them so that I can ensure that we have
opportunity to really understand the situation and show some compassion and
empathy for the experience they went through,” he said in an interview on
ABC’s “Good Morning America.” “Finally as we’re working to solve this, I’d
like to invite them to join me in finding a constructive way to solve this
The company has also confirmed that the manager who called the police is no
longer working at that store. Starbucks would not comment on other reports
that she has left the company by mutual agreement. In his “Good Morning
America” appearance, Johnson refused to say whether she had been
disciplined, saying he didn’t want to “point blame.”
Starbucks’ crisis response seems especially smart after The Washington Post published a story bringing additional
allegations of racial bias at Starbucks.
The situation—which was first posted online in January—was also recorded on
video, which went viral following the arrests in Philadelphia.
In the California incident, the black man recording the video — whom
identified as 26-year-old Brandon Ward —
asks a white customer
who used the bathroom if he had any trouble obtaining the entry code. Ward
wasn’t able to himself.
… The video, which Ward
to his Facebook page two days after the Philadelphia incident, had nearly
5,500 views by Tuesday evening. Activist Shaun King posted it to Twitter,
where it was retweeted nearly 50,000 times.
Many are also taking note of the way Starbucks and its chief are handling
its crisis response due to its initiatives around social issues such as
gender and race, which some say has put the company under increased
Starbucks has continued to champion progressive causes in the workplace.
Last month, it claimed it had achieved 100% pay equity across gender and
race for all its US employees, and committed to doing the same for its
overseas operations, an initiative publicly backed by equality activist and
tennis legend Billie Jean King.
Communications experts said such policies meant Starbucks had to hold
itself to high standards in all its stores.
Jacinta Gauda, the head of the Gauda Group, a New York strategic
communications firm, said: “The more your brand is trying to connect
emotionally to people, the more hurt people feel when these kinds of things
happen. They are breaking a promise. That’s what makes it hurt deeper.”
Another communications expert praised Johnson for meeting with the men who
“That’s very rare,” Aaron Allen, founder and CEO of global restaurant
consulting firm Aaron Allen and Associates, told CNBC. “And it sends a
message not just externally, but a strong message internally.”
Allen said that for the majority of companies, the initial inclination is
to “batten down the hatches” and stall for time to figure out a solution.
One sign of the success of its strategy is that Starbucks stock has
remained relatively stable throughout the whole incident.
Though some criticized Johnson for avoiding race in his first statement,
communicators said the training highlights the actions Starbucks is willing
to take to effectively handle its crisis.
“The CEO was slow to address race, which remains a big stain on Starbucks’
brand trust,” Eric Schiffer, chairman of Reputation Management consultants,
told CNBC via email. “But, the closing of Starbucks stores for racial-bias
training is the single smartest move they can make. It shows through
action, not talk that they get it and they value doing the right thing over
earnings and customer cash.”
What do you think of Starbucks’ recent moves to handle its crisis, PR Daily readers?