Starbucks smells the social coffee
Starbucks CEO Howard Schultz has announced the launch of an innovative new cross-channel, multi-brand loyalty programme, along with new global social impact initiatives.
The company's existing My Starbucks Rewards loyalty and rewards programme is to be expanded to allow customers to earn rewards for grocery channel purchases, which can later be redeemed in Starbucks retail stores. This programme expansion is expected to double the number of customers enrolled in the company's programmes during the fiscal year 2013.
The company's loyalty programme already drives increased revenue, traffic and purchases, and a key point of differentiation between Starbucks and its competitors. Among the highlights of the newly expanded programme will be:
- Beginning in May 2013, customers will earn My Starbucks Rewards Stars for purchases of Starbucks packaged coffee in grocery channels. These Stars can then be redeemed for free food or beverages in Starbucks retail stores. The programme is expected to be expanded later in the year to include other Starbucks products sold through grocery channels.
- Integration of the Starbucks Card and My Starbucks Rewards loyalty programme across several of its emerging brands, including Teavana. Beginning next month, registered customers who make purchases with a Starbucks Card or through the Starbucks mobile app at any of over 300 Teavana retail stores will be able to earn Stars for their purchases.
Together, these new programme innovations are expected to contribute toward a rapid and substantial increase in My Starbucks Rewards membership, from 4.5 million active members at the end of October 2012 to approximately 9 million members by the end of this year.
In January 2011, Starbucks began to offer its own mobile payment technology combined with its loyalty programme, and the company now generates over three million mobile transactions each week in the US alone – accounting for approximately 10% of total US tender, according to the company's chief digital officer, Adam Brotman. In fact, the company claims that the Starbucks card represents some 1 in 3 transactions in the US.
New mobile users have reported that they are embracing the Starbucks mobile payment platform because of the benefits they receive and because it enables them to track their loyalty status in an interactive and engaging way directly on their mobile device.
Finally, Blair Taylor, Starbucks' chief community officer, announced the launch of a new non-profit corporation with a US$1 million seed grant to introduce job skills, leadership and apprenticeship programmes to young people throughout the company's multi-billion dollar supply chain, and further expansion of the company's support for US manufacturing through an order for 100,000 ceramic mugs from a supplier in Ohio.