Last quarter, Starbucks pulled the plug on its olive oil-infused Oleato coffee line as part of a broader push to streamline the menu and impro1ve store operational efficiency.
Oleato was among Starbucks’ boldest and riskiest experiments in recent years. It was the brainchild of founder and then-CEO Howard Schultz, an assertive visionary. During a visit to the olive groves of Sicily, Schultz was inspired by the Mediterranean tradition of consuming a daily spoonful of olive oil. He envisioned merging this health practice with Starbucks’ coffee expertise, creating a unique fusion of wellness and indulgence.
Debuting in Italy in February 2023, Oleato expanded globally, offering lattes and cold brews infused with extra virgin olive oil, marketed as luxurious, innovative, and health-conscious. While some customers liked the smooth, velvety texture, many found the flavor odd or the concept hard to swallow. Scaling the product and educating consumers proved challenging, leaving many unsure of its benefits beyond novelty.
Oleato’s flop revealed the risks of niche innovation. Starbucks thrives on pushing boundaries, but not all bold ideas hit the mark. Smart innovation requires knowing when to nurture an idea and when to cut losses. Schultz’s vision of Oleato kept Starbucks daring, but disciplined decision-making is key to ensuring innovation remains a strength, not a liability.
The Oleato dud highlights the perils of leadership driven by unchecked conviction. Schultz’s love affair with Italian espresso bars during a visit to Milan sparked the creation of Starbucks. However, visionary leaders like Schultz often turn bold ideas into untouchable pet projects. Even a passing thought can rapidly evolve into a sweeping directive, leaving little room for dissent. In such environments, feedback is stifled, and ideas can quickly take on a life of their own.
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