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Starbucks Investor Asks CEO Schultz About Refugee Program
Starbucks' most recent controversy pledging to hire 10,000 refugees (see ROOM FOR KARMA? Starbucks’ Popularity and Sales Tank After Refugee Employment Pledge) has sparked applause from the left, but major eye-rolling from the right. Justin Danhof, an in investor of Starbucks, owns CEO Howard Schultz’s with his questions during Starbucks annual shareholder meeting:
Danhof poses some thought-provoking questions concerning the motives behind Starbucks' decision to hire refugees:
I have two quick questions: I understand that as you said ‘not every decision is based on economics,’ but economics are a hard reality. So, the first question is how much will investors have to spend so that company can properly vet refugees that the federal government admits it can’t always afford to vet? And why were you willing to have Starbucks’ reputation take a beating by attacking President Trump’s executive order when you lacked the courage to speak out against Obama/Clinton travel ban.
Mr. Danhof has done his research. With Obama and Hillary’s travel ban in 2011 came little hurrah. (see SICK: Black Lives Matter APPLAUDS Barista Spitting in Cop’s Coffee). But six years later and one new president, suddenly Schultz is afflicted with all the feels. Which he tried claiming had zero to do with politics.
Howard Schultz couldn't answer Danhof's question, so he pivoted back to lofty talking points, which he claimed was detailing Starbucks' motives in hiring refugees.
If there’s one message that I think, I hope, you came away with today it’s that none of the things we’ve tried to do as a company, which is based on humanity and compassion, is based on politics. But it’s based on principles and our core beliefs.
I can unequivocally tell you…that there’s zero, absolutely no evidence whatsoever, that there’s any dilution in the Starbucks brand, reputation, or core business as a result of being compassionate.
Schultz details the company's decision, framing it as if Starbucks' has not received backlash. Now, to be fair businesses can do what they want in the political realm. It is, after all, a free country. But said businesses must be prepared for the consequences of those actions. In Starbuck's case, a brand hit.
So Mr. Schultz can tell himself whatever he likes. He can even say his company is based on "compassion." Even though his brand is based on coffee. But his brand's perception, as seen by its customers (those people who patronize the business and drink said coffee, not "compassion") have a different perspective. When the customer's perspective on a brand shifts, so do their dollars.
Usually when someone enters a Starbucks they're looking for coffee, not compassion, not social justice. Investors invest in Starbucks because people enter a Starbucks looking for coffee, not compassion, not social justice. Well, when customers decide they're getting too much "compassion" (as defined by Schultz) and social justice rather than just coffee, customers decide to go somewhere else. For just the coffee. And when those customers go somewhere else for just coffee, investors start raising hands.
Rather than assuage the investor's concerns, though, Schultz doubled down. As is the way of the left. So if Starbucks as a brand continues to take hits, if patrons continue filling up their mugs at other locations, we can look back on this video and wonder not.
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