All the news that’s fit to read with coffee

Starbucks as of late has been linking some big partnerships to its loyalty program. Last week, the coffee giant announced a new deal with Times in which the retailer would make available a selection of top daily news and other articles from the paper on its mobile app for free to the 10 million My Starbucks Rewards members. Starbucks customers will also be able to purchase complete digital and print subscriptions to the Times and receive reward "Stars" in the process.

"We see a future in which the Starbucks retail experience seamlessly extends to the mobile devices our millions of customers carry with them every day," said Howard Schultz, chairman and CEO of Starbucks, in a statement. "Our relationship with The New York Times is the perfect example of bringing this vision to life. We have proudly sold millions of copies of the paper in Starbucks stores for more than a decade, and are excited to bring this experience to the next level by enabling Starbucks loyal customers to take the best of The New York Times with them wherever they go, whenever they want it."

Times‘ content will become available on the Starbucks mobile app beginning in the first half of next year. Customers visiting the chain’s stores are currently able to gain free access to 15 articles published on the paper’s site through the Starbucks Digital Network. The coffee company has said that it also plans to add content from other publishers.

Starbucks NYT app=

Photo: Starbucks

The goal of the coffee chain is to reward My Starbucks members with points for purchases made inside its stores and elsewhere. The deal with the Times, along with others made with Spotify and Lyft, are examples of Starbucks’ intentions.

Back in May, Starbucks and Spotify announced a multi-year deal between the companies. Beginning in the fall in a phased rollout, My Starbucks members will be able to access Spotify via the Starbucks mobile app. There will be a dedicated Starbucks section on Spotify that features playlists from the past 20 years at the coffee chain. Starbucks will promote Spotify’s premium service in its stores and the streaming music service’s members will be given opportunities to earn Starbucks Stars.

Last week, Starbucks announced a deal with the ride service, Lyft. Drivers for the service will be awarded immediate gold status in the Starbucks program and customers will be able to use the Lyft app to send an extra "thank you" for great service in the form of the chain’s eGift to drivers.

BrainTrust

"This is smart for both parties. Starbucks is creating a total experience (and other retailers will follow with media and media property partners), and the New York Times is maintaining its relevance. The demographics are almost a perfect dovetail. Watch for more of these kinds of alliances — retail and media — in the future."

Liz Crawford

VP Planning, TPN Retail


"Well, this is the last straw...now they know exactly what I do with my first cup of coffee. Yikes. Maybe they could partner with the water gods and get us some H2O in Cali!"

Lee Peterson

EVP Thought Leadership, Marketing, WD Partners


Discussion Questions

What is your assessment of Starbucks’ use of its mobile app and rewards program to create opportunities for its business both inside and outside of the chain’s stores? Why types of partnerships or other direction do you see Starbucks taking with its mobile app in the future?

Poll

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Liz Crawford
Liz Crawford
8 years ago

This is smart for both parties. Starbucks is creating a total experience (and other retailers will follow with media and media property partners), and the New York Times is maintaining its relevance. The demographics are almost a perfect dovetail.

Watch for more of these kinds of alliances — retail and media — in the future.

Max Goldberg
Max Goldberg
8 years ago

This is a win for Starbucks and a potentially huge boost for the New York Times. Starbucks is making its app and rewards program more relevant, while the Times gains readers and potential new subscribers. Starbucks is all about lifestyle. By bringing Spotify, the Times and Lyft into its loyalty program, Starbucks extends its reach by multiplying the number of consumer interactions with the lifestyle of the brand. The cost to Starbucks is small, the potential benefits to its customers is great.

Peter Fader
Peter Fader
8 years ago

Starbucks is really leading the way on all things mobile. This is yet another nice extension of their platform, and another excellent way to attract/retain the “right” (i.e., high CLV) customers for their brand. I hope all retailers are watching carefully and will be willing/able to make bold moves like this in the near future.

Matt Schmitt
Matt Schmitt
8 years ago

Howard Schultz has always been keen on connecting Starbucks customers with content, from newspapers to CDs. The new partnerships with the New York Times and Spotify are part of a logical strategy to jump from analog to digital distribution.

Starbucks is leveraging its highly valuable brand equity, and the focus on attaching the loyalty app to content partners and to services like Lyft are indications of a very active and concerted effort to keep the Starbucks loyalty program at the top of the heap. Let’s hope other retailers are not just paying attention, but taking action to innovate in the area of loyalty programs and customer experience.

Shep Hyken
Shep Hyken
8 years ago

Once again Starbucks makes a good customer-focused decision. It is a benefit to the customer and a way for the New York Times to reach a new audience. Like almost any newspaper today, they need readers! It’s a triple win: the customer, Starbucks and NYT.

Doug Fleener
Doug Fleener
8 years ago

Love it. So many loyalty programs are nothing but disguised coupon programs and sales, but with Starbucks there are these type of additional benefits and rewards. (Besides paying by app.)

This is about a brand community. Starbucks can and will easily expand this to retailers, travel partners, other media and additional companies that don’t directly compete with Starbucks.

The Third Place that Howard Schultz talks about continues to evolve, in and outside of the Starbucks locations.

Robert DiPietro
Robert DiPietro
8 years ago

This is a terrific tie in of a retailer with a content provider. It also provides great value for the Starbucks reward program. I think this is the best extension I’ve seen yet — far better than Dunkin’ Brands and retailers like Best Buy or Dick’s Sporting Goods.

It’s also a great brand/culture fit. Who doesn’t want access to the last 20 years of Starbucks’ playlist?

Joan Treistman
Joan Treistman
8 years ago

Starbucks so far is aligning its rewards program with the lifestyle of its customers. I hope they don’t start to go beyond what fits their customers’ Starbucks experience in-store, hanging out there or on-the-go.

The New York Times content for staying in the store and Lyft to take customers where they want to go next makes a lot of sense and insures customer use. Also these partners are simple and immediate gratification applications, for content or for a ride.

If the rewards program partners with retailers and electronics, for example, I think the program will go off the tracks.

Joel Rubinson
Joel Rubinson
8 years ago

The question this raises in my digital brain is if this is a “second-party data deal” where two companies exchange first-party data for marketing purposes. Certainly I would have asked for this if I were Starbucks. No insights or inside information, just a guess. Looking for thoughts by any other community member.

Li McClelland
Li McClelland
8 years ago

A true loyalty program would give the customers a choice of the paper they get, not choose for them. How about offering the NYT, the Wall Street Journal, and USA Today and let the customers—not Howard—pick their news? This feels manipulative in a similar way to the recent “let’s talk about race” catastrophe from Starbucks. Are they forgetting that they’re first and foremost supposed to be in the business of selling coffee?

Lee Peterson
Lee Peterson
8 years ago

Well, this is the last straw…now they know exactly what I do with my first cup of coffee. Yikes. Maybe they could partner with the water gods and get us some H2O in Cali!

Mark Price
Mark Price
8 years ago

The goal of the mobile app is to connect a specific segment of customers to the Starbucks brand, both in and outside their stores. The New York Times fits the psychographic of at least one segment of heavy Starbucks users (more on the East and West Coasts) and just provides another reason to open the app and get value from it.

I see other partnerships addressing the needs of other segments of the Starbucks customer base, such as moms with young children (the late morning crowd in many places).

Seeta Hariharan
Seeta Hariharan
8 years ago

It’s all about creating a more engaging experience for your customers. Starbucks is ahead of the curve in identifying a digital retail ecosystem with NYT and Lyft that is custom tailored for their clients. Smart partnerships like this help connect digital dots for customers around services, or offerings that the customer may not be expecting, or even know they want, but will truly appreciate.

I also agree with comments about leveraging open data to drive multi-win opportunities for retailers, content providers and most importantly, the consumer. Data sharing is where the rubber meets the road. With the ability to understand more about an individual through a multifaceted, highly customer centric lens, retailers can provide more personalized and fitted offerings. Starbucks is clearly identifying with what their customers want, and what will make smart partnering sense to deliver an ever expanding connected experience.