Starbucks China hires first chief growth officer following rumors of saleStarbucks China hires first chief growth officer following rumors of sale

Joanna Fantozzi

Amid rumors that Starbucks is considering selling off its China business in the face of intense competition from brands like Luckin Coffee, Starbucks China has appointed Tony Yang as its first chief growth officer, as first reported by Chinese media outlet, Late Post.

According to Reuters, Yang previously worked as a partner and president of Chinese digital marketing firm, Tezign, where he has been since 2019. Before that, Yang held senior leadership positions in marketing divisions at Procter & Gamble, PepsiCo, and Alibaba Group.

In his new role, Yang will be charged with driving business growth in mainland China. His appointment comes just a few months after former Starbucks China co-CEO Belinda Wong stepped down in September amid financial pressures on Starbucks’ second-largest market. CEO Molly Lieu has since assumed sole leadership of the Starbucks China division, while Wong assumes the role of chairwoman of Starbucks China.

Over the past several months, rumors have circulated from media outlets like Bloomberg that Starbucks was allegedly considering selling the stake in its China business, seven years after originally acquiring the business. During Starbucks’ latest earnings call, the company reported a 14% same-store sales decline for Starbucks China and a 6% decline in traffic, directly comparable to “intensified competition and a soft macro environment that impacted consumer spending.”

Related:Brian Niccol wants Starbucks customers to get their cups of coffee in ‘under 30 seconds’

Starbucks’ main competition in China is Luckin Coffee, which reported a 39% increase in transacting customers last quarter, though it reported a similar same-store sales decline to Starbucks of 13.1%. As both Luckin and Starbucks continue to face pressure abroad, Luckin Coffee is allegedly planning an expansion to the U.S., as reported by the Financial Times in October.

While Starbucks CEO Brian Niccol called competition in China “extreme,” he said the company’s focus was on “strategic partnerships” that could help lead to long-term growth. Hiring Yang could be the coffee chain’s next step in trying to grow its presence in China to offset the traffic and sales challenges.

As of Oct. 30, Starbucks China had 7,596 stores in its portfolio.

Contact Joanna at [email protected]