Starbucks: Cool or a commodity?

Coffeehouse conundrum facing returning CEO Howard Schultz

By Jasmin Aline Persch

Jan 29, MSNBC

Starbucks brought us the Italian coffee experience, teaching us to sip fancy espresso drinks in quaint cafes. Now the trendsetter is falling out of vogue — and some question whether the ubiquitous coffee chain can be cool again or will sink to a commodity.

That’s the conundrum facing Howard Schultz who’s returning as head of Seattle-based Starbucks, which for years was hailed by customers, investors and business professors, alike. That changed recently: The company’s stock price was slashed almost in half this past year. And store traffic slipped last quarter for the first time since the company went public.

Many trust, though, that Schultz can do something to help Starbucks — but what? He’s expected to spill further details about the turnaround agenda Wednesday, when the company reports first-quarter earnings. So far, Shultz’ plan involves closing some slacking stores, retarding growth here and amplifying it abroad.

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photo: A Starbucks coffee shop in the financial district of Boston experiences a high volume of business during the noon hour Wednesday afternoon, Aug. 1, 2007. Starbucks is expected to release quarterly earnings on Wednesday (AP Photo/Stephan Savoia)