Create individualized offers at enterprise scale: Starbucks created millions of offers each week across multiple offer types. Each type of offer was constructed with dynamic actions and rewards to improve certain customer behaviors including frequency, category exploration, cross-sell and upsell. Dramatically increase execution speed and reduce manual work: Starbucks automated many facets of the offer process using the Formation platform, including development and measurement.
This led to dramatically faster operations and improved operational efficiency. Conduct advanced experiments: The rewards program safely, incrementally and reliably tested initiatives in the market using Formation's rapid experimentation capability. Starbucks prioritizes creating an individualized experience for customers from their app to their baristas. Starbucks first launched their rewards program in with a punch card.
In September , they announced that customers could now earn stars by preloading their app and even saving a credit card. Rewards have an expiration date because we want to encourage members to use them. As our most loyal customers we want you to enjoy all your rewards because you deserve that free hand-crafted beverage, size upgrade and customization. We hope you will visit us often enough that your rewards won't ever come close to their expiration date. You can always check the status of your rewards if you log into your account at www.
Click on "Account Rewards" and there you will find the number of Stars and the status of the rewards you have earned. You can also use the Starbucks India mobile app to keep track of your rewards. Rewards can be redeemed by using your registered Card and letting your store partner know you have a birthday or earned reward on your account.
Your store partner will redeem it on the item of your choice. Can I qualify for multiple years in a single year? For example, if I earn 50 Stars in the next year, will I be in the Gold level for the next two years?
Every year on your anniversary date the date you qualified for the Gold level , our system will look back and confirm whether or not you have earned the minimum 25 Stars during that timeframe. If so, you'll remain at the Gold level for another year.
You can only qualify for 1 year at a time and earning more than the necessary Stars does not make you eligible for the Gold level for multiple years. If you do not earn the necessary 5 Stars to maintain your Green level status in the program, your Stars will be reset to 0 and you would be at the Welcome level from where you would need to earn 1 additional Star to stay at the Welcome level or earn 5 additional Stars again to go back to the Green level.
Will I get to use the unused Birthday Reward as well? Any unused Birthday Rewards will not be carried forward to the following year. Can I redeem multiple rewards at one time? Yes, you can redeem multiple rewards that you have in your account at a single time as long as they are within the expiry period. Can I redeem multiple offers on the same beverage? How do I redeem the offers?
Any time-limit in collecting Stars to reach the next level? The Stars accumulated will be calculated annually on your anniversary date the date you qualified for the current level of membership to determine the level of membership you are in.
Stars accumulated will be calculated independently each year. Do I have to bring my card to earn Stars? Yes, you will need to pay by the physical Starbucks Card or use the Starbucks India mobile app at the time of purchase in order to earn Stars.
Do I have to register my Gold Card again after I received it? Your Gold Card has been pre-registered to your account and you may transfer funds from one of your cards or reload value to your Gold Card once you receive it.
You can use the Starbucks Card registered to your account to earn Stars and redeem rewards. All Starbucks Cards registered on www. Are they served more slowly? Maybe this is why Starbucks is doubling down on its Reserve Roastery high-end concept, to segment out the grab-and-go types like me from the coffee shop experience-seekers.
Your blog post reminds me of our first case in class on Dominos Pizza. But as competition moved quickly, other players such as UberEats and DoorDash threaten the competitive advantage these single-brand apps, such as Dominos, had developed. Interesting read! I think the membership programs that have become increasingly common in retail are an interesting way for traditionally analog companies to begin to experiment in the digital world.
There is clearly value on the table for both the company and the consumer so I can imagine it would be an easier internal sell than some other digital transformation projects. I wonder how Starbucks will continue to improve their application to build an experience that connections the physical and digital worlds for their consumers and differentiate against other big chain coffee shops.
Thanks Leah for the interesting post. I completely agree that the reward loyalty program is an effective initiative to reduce the customer churn due to the entry of new coffee players. However, I believe that it is even more important to improve the customer experience by creating new products that match with the evolving preferences of customers.
As you mentioned in the article, data will play a critical role in the future to offer a more personalized service. Starbucks has developed some initiatives in this line. For example, in Starbucks installed 1, Mastrena II expresso makers, which have IoT sensors for preventive maintenance purposes. In , Starbucks implemented a value-based loyalty scheme that awards customers two stars for every dollar spent. And, the customers who collect stars were able to redeem a free drink and food.
Today, customers can directly download the Starbucks Rewards app to their phones and use it as a digital card in store. Members can access the menu and place orders before they even get to the cafe. To encourage customers to return to the store more often, the app also sends push notifications advertising promotions. Starbucks informs their customers about how they can earn points and redeem rewards via the app as well as a dedicated landing page on their website.
Members who play the games in the app or on email are able to earn bonus stars. To show how much they value their members, Starbucks offers members free drinks on their birthdays. To delight and surprise their loyal customers, Starbucks announces seasonal promotions and new product releases to its members first.
They also create double star promotion campaigns to reward their loyal customers. By following a similar strategy, you can easily convert one-off customers into loyal members, and scale up your business.
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