According to the Star Daily on December 13 (Reporter Xu Cihai), following the appointment of new CEO Liu Wenjuan in September, there has been another change in Starbucks China's management.

The Star Daily's reporter learned today from Starbucks China that the company has appointed Yang Zhen as the Chief Growth Officer, marking the first time Starbucks China has established this position to respond to fierce market competition and seek new growth points.

According to Starbucks China, the newly established Chief Growth Officer position aims to promote sustainable development for Starbucks in the Chinese market by accelerating coffee-centered product innovation and combining it with more efficient integrated marketing strategies.

Among this series of adjustments, the newly established Chief Growth Officer position is particularly noteworthy.

According to public information, Yang Zhen previously served as the head of user development at Jiyue and left before the marketing department was reformed in April this year. Prior to that, he held positions such as Senior Vice President and CMO at Alibaba's Cultural Entertainment Group, Senior Vice President at Youku, President and Partner of the digital marketing firm Tizan, and Senior Vice President at VMLY&R. His background shows that Yang Zhen has been deeply engaged in marketing and corporate digitalization, which is why he has been chosen by Starbucks China.

Since last year, the Chinese coffee market has fallen into a price war, with competition ranging from special price coffee at 9.9 yuan to ultra-low prices of 8.8 and even 6.6 yuan. In this context, Starbucks, which touts the concept of a 'third space,' is facing severe challenges as its performance in China continues to decline.

According to the latest earnings report data released by Starbucks, in the second to fourth quarters of fiscal year 2024, its brand revenue, same-store sales, and order volume, among other key financial indicators, have all declined compared to fiscal year 2023. Particularly in the fourth quarter of fiscal year 2024, Starbucks China's revenue was only $0.784 billion, a year-on-year decrease of 7%; comparable store sales fell significantly by 14%, average transaction value dropped by 8%, and order volume decreased by 6%.

Currently, Starbucks is speeding up its development pace in the Chinese market, with a net increase of 790 new stores in the 2024 fiscal year, a year-on-year growth of 12%, setting a historical high in total store count. However, this growth did not drive an overall increase in revenue.

At the present stage, Starbucks' global management is actively seeking reform. Last month, there were market rumors that Starbucks is discussing with a consulting team how to optimize its business layout in the Chinese market, including considerations to sell partial business shares, introduce local partners, and even informally assess the interest of potential investors, including domestic private equity firms.

At that time, a global spokesperson for Starbucks stated that the company is investing more time to deeply understand the operational details and competitive landscape of the Chinese market in order to find the most suitable development path.

The establishment of the CGO may also be just part of a major adjustment within Starbucks' management. In August this year, Brian Niccol was appointed as the global CEO of Starbucks. At the end of September, Belinda Wong stepped down as the CEO of Starbucks China but retained the chairperson position, while former co-CEO Molly Liu was promoted to CEO.

Yang Yang, founder of Inside Coffee, stated in an interview with the Star Daily that with the booming domestic coffee market, Starbucks is facing increasingly fierce competition. Many local brands are emerging, attracting consumers with innovative products and services in the competition for market share.

In his view, to solidify its leading position, Starbucks must continue to innovate and flexibly adjust its strategy. Against this backdrop, Starbucks appointed Yang Zhen as Chief Growth Officer, which is seen as an important exploration for brand development and market adaptation. "Appointing Yang Zhen as Chief Growth Officer is undoubtedly a bold attempt by Starbucks China in brand development and market adaptation. Yang Zhen has extensive experience in digital marketing, which may bring new perspectives and ideas to Starbucks, especially in digital marketing and user experience."