Starbucks Is Making Big Changes to Its Loyalty Program

·3 min read
Photo:  Nor Gal (Shutterstock)
Photo: Nor Gal (Shutterstock)

Starbucks Corporation held its biannual Investor Day on September 13, and the proceedings were filled with not only a lot of caffeine but also some big updates to the Starbucks Rewards loyalty program. The implications seem big for any regular customer of the chain: not only will you soon be able to earn and redeem Stars in more locations, but you might also be able to put those Stars toward other non-Starbucks purchases in the near future.

How Starbucks Rewards is changing and expanding

Whether you grab a cup of coffee at the airport before a flight or treat yourself for a successful grocery run, you’ve probably noticed that these licensed Starbucks outlets differ slightly from the chain’s standalone coffee shops—and it’s often clear that they’re missing something. Many won’t let you pay in Stars, for example, while others won’t let you place a mobile order.

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“Today, we deliver an inconsistent experience between our company-operated stores and our licensed stores,” said executive vice president and chief marketing officer Brady Brewer at the Investor Day event. To remedy that inconsistency, Starbucks is using a technology called Starbucks Connect to allow licensed locations to provide the same mobile ordering and reward-redeeming capabilities as any regular Starbucks location.

This means that when you go to Kroger, Jewel-Osco, a gas station, or an airport and want to grab a grande Frappuccino, you will likely be able to redeem Starbucks Rewards Stars to get one (provided you have racked up at least 150 of those bad boys). However, a Starbucks representative did clarify for The Takeout that the coffee chain has no plans to bring mobile ordering capabilities to any of its locations inside Target stores. That’s slightly disappointing for those of us who like to emerge with eight new outfits and a latte from a Target run intended to yield a two-item purchase, but I digress.

The rollout of the Starbucks Connect technology has actually been in the works for some time now, a rep confirmed. Around 1,400 licensed stores have adopted the Starbucks Connect technology, per Brewer’s remarks, but about 80% of the company’s portfolio has yet to implement it. If the chain is able to turn more casual grocery-store coffee sippers into loyal Starbucks Rewards members, it stands to make huge gains in visits and sales by pushing promotions out to people who don’t usually make a special trip just to grab Starbucks at a standalone location.

Brewer also teased plans to expand the loyalty program another way: Starbucks purchases might soon earn customers rewards from other companies.

“Imagine earning miles faster at Starbucks with your favorite airline through your everyday purchases at Starbucks,” he said. “Imagine earning Stars when you shop with your favorite retailer, imagine joining Starbucks Rewards so easily by just tapping one button in another brand’s loyalty program.”

This all sounds suspiciously like a credit card, but I can’t say I’d be unhappy about earning more airline miles one Strawberry Açaí Refresher at a time. The company didn’t specify which other brands might be involved in this loyalty program crossover, but it did note that one of the first partnerships would be announced in October.

It doesn’t take a business degree to see that allowing people to redeem reward points and place mobile orders is a huge opportunity to grow sales, no matter what kind of product you sell. I hate to admit how much money Starbucks already gets out of me, but let’s just say as soon as I can use the app to advance-order a coffee at my nearest Target to walk around the store with, my wallet is going to be in serious danger.