With the popularity of coffee shop culture bringing local, standalone stores to every city, longtime coffee chain Starbucks is incentivizing brand loyalty with something no one can refuse — free stuff.
Starbucks introduced its rewards program in 2009, providing members with one point for every visit to the store. They reformed it in 2016 to double the number of points for every buck that leaves your pocket, and the program is now responsible for 40 percent of transactions in U.S. stores, hinging on a simple principle: the more you spend, the more points you unlock and the more free stuff you receive.
Starbucks is again redesigning its membership loyalty program to attract more people to its stores. Under the current program, customers need to hit 300 points within a year at two points per dollar spent to just be eligible to receive free products based upon their purchases, and only after an additional 125 points do members earn a free drink.
Compared to Subway’s rewards system, where every $25 earns a free item, Starbucks’ program is much more of an investment. However, the new system, much like the fast food chain, allows Starbucks regulars to earn rewards with every 25 to 50 points.
Senior psychology major Amanda Waldemar said Starbucks is her favorite coffee brand. She shared that she grew up drinking Starbucks, so she is very familiar with their menu and is often reluctant to try new coffee places.
Waldemar has used Starbucks Rewards in the past, and she said the existence of a loyalty program is one advantage Starbucks holds over many local shops that don’t have programs in place. She said these new adjustments will likely encourage her to take a few extra coffee breaks.
“The more drinks I buy, the more free drinks I get, so that would incite me to go to Starbucks more often,” Waldemar said.
Senior digital media major Tre Pierce said he visits Starbucks for a sugar rush. He explained that the company’s target market is largely Millennials and college students, so the rewards program should reflect the needs of that group if Starbucks is to stay relevant in the coffee shop competition.
Starbucks is also inviting a couple more changes this year with the “Starbucks Greener Stores” initiative. Starbucks plans to replace single-use plastic straws with strawless lids and straws made of alternative materials across the globe by 2020.
The initiative will also focus on implementing more environmentally sustainable ways of running the stores, including the use of solar and wind power to generate electricity for the stores in the U.S. and Canada.
According to a CNBC article, Starbucks aims to save “$50 million in utility costs over the next decade as a result of the plan.”
Starbucks is planning to carry out these bigger picture goals globally by 2025.