Starbucks’ loyalty program has some flaws. Let me explain…
I don’t recall the first time I got hooked on that sweet milk and espresso. It was sometime before I began working for Starbucks back in 1997. After a couple years there, I no longer had the choice to enjoy a latte or not; it was simply part of me. Just look at my ‘Spending by Merchant’ trends in Mint.com—it tells of my coffee…let’s say “enjoyment”.
In 2008, I picked up the $25 per year Starbucks Gold Card. You pay a little up-front, but the benefits far outweigh the cost if you are actually loyal. It worked for me. I got 10% off each visit, plus some other cool features.
On December 26, 2009, a new loyalty program, My Starbucks Rewards, came in, and out went the Starbucks Gold Card. Unfortunately, I didn’t know what to do or how to switch. A blog from Starbucks mentions the existing Gold Card members should have automatically moved into a Green Card level. Did I know? Nope.
I gave up on the card for a while. I felt dumped and didn’t get migrated. I was busy and didn’t want to learn something new. After all, I had been a loyal customer for many years. It shouldn’t have been my job to figure it out.
In mid 2010, someone gave me a Starbucks gift card and I decided to enter the new loyalty program. I signed up online and downloaded the iPhone app. Cool, I was back.
I knew it was 5 stars to Green Level and 25 more to Gold Level. Keep in mind, a star is a visit. Doesn’t matter if you buy 24 lattes for your team at once, you get 1 star. Any which way, no worries— I’d be there soon. And, I was. But, was I happy? Sort of. Am I a brand advocate? No.
- Starbucks dumped me: It’s not the customers job to figure out how to transition their loyalty card. Starbucks dumped me and it took me some time to jump back in.
- Starbucks forgot me: I’ve been going to Starbucks for 16 years, worked there during college for two years, and have been loyal as can be. I paid for the early Gold Card back in 2008 but wasn’t migrated in the transition. When I hit Gold status on My Starbucks Rewards, my card was sent with my name (cool) and ‘Cardmember since 2011′ (not so cool). Made me feel like my 16 years of loyalty didn’t count anymore.
- Starbucks doesn’t really want me to have a free drink: Most Green or Gold Level rewards are given at the time of purchase by paying with your phone or Starbucks card, but not your free drink. Why? Because they are hoping you don’t redeem. They send you a postcard in the mail. Yeah, it’s a cool matte black postcard and you can redeem it when you want. But, when I want to redeem my free drink is exactly when I’ve reached that free drink. Don’t make me wait two weeks to get a postcard in the mail. I know Starbucks gets lower redemption rates by mailing postcards, but they should know that you create loyal customers by actually rewarding them. Not by making them think you are rewarding them.
- Starbucks must not realize the power of sharing via mobile: Why is the Starbucks app so static? It doesn’t connect me with my friends or allow me to share the fact that I just hit uber Gold status. Yes, I can login and share from the full website view, but not from my phone. It doesn’t incentivize me to bring others into my coffee madness. Influence is important in measuring loyalty. More important than just measuring visits.
- Quality: Starbucks drinks are not what they once were. The product is the reason you become loyal in the first place. If the product suffers, so will your loyalty. What happened Starbucks? You went super automatic. Drinks suffered and still do. When I was trained at Starbucks back in 1997, the quality mattered. That training matched what Howard Schulz wrote about in the book that inspired me to work there. In “Pour Your Heart Into It”, it was truly about a culture, an environment, the quality, and the experience. Today, it’s about speed, efficiency, and reducing workers injuries from pulling shots on manual machines.
How does this sort of “Starbucks’ Kind of Loyalty” sit with you?
*My fave two shops are Mike Perry’s famous Coffee Klatch in San Dimas and the quaint Classic Coffee in downtown Glendora. Their product is so good, they don’t need a loyalty program.