Schultz Announces 1,000 More Job Cuts at Starbucks†

Senior VP-Global Strategy Michelle Gass Shifts Back to Marketing Role as Part of Reorganization

Advertising Age, July 29, 2008 — Starbucks CEO Howard Schultz said the coffee retailer will cut 1,000 jobs in addition to those resulting from the 600 store closures announced earlier this month. It's unclear how many marketing personnel will be affected, but those familiar with the matter said some groups are facing double-digit cuts in what's being described internally as a "bloodbath."

In another organizational move, Michelle Gass is back in the marketing department, as senior VP-marketing and category. Ms. Gass, a 12-year Starbucks veteran, is credited with much of the Frappuccino's success. She was elevated to senior VP-global strategy in January, and has been overseeing Mr. Schultz's much-discussed (and debated) turnaround plan. Her move is viewed as a need for her expertise in marketing and product development and not as a demotion. Those familiar with the matter suspected that the research-and-development pipeline had been found wanting.