How Far Can Starbucks Loyalty Program Reach?
During Starbucks’ last conference call in January, chairman, president and CEO Howard Schultz was pumped about the growth of the My Starbucks Rewards program. Over the course of a year, he said, membership of the program grew 86 percent.
"It’s not that these new card customers didn’t know where to find us last year," said Mr. Schultz. "It’s that we are more deeply connected, and even more relevant, to them than any other time in our history."
Mr. Schultz attributed growth of the program to the integration of the company’s "mobile, web, card, and loyalty program strategies." In January 2011, Starbucks became the first national retailer to marry its own mobile payment technology with a loyalty program.
Now, comes word from Starbucks’ annual meeting that it will expand the program to allow members to earn rewards buying its bagged coffees in grocery stores. The new program, which will launch in May, will be expanded in the fall to include other Starbucks products.
The integration of the Starbucks Card and the My Starbucks program will be integrated with other company divisions including 300 Teavana retail stores.
Adam Brotman, chief digital officer at Starbucks, said the company expects the program to grow from 4.5 million active members at the end of last October to roughly nine million members by the end of its current fiscal year.
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What is your reaction to Starbucks expansion of the My Starbucks Rewards program to grocery channel purchases? What can other retailers learn from Starbucks development of the program?