The news: Starbucks will reintroduce tiers to its loyalty program starting March 10 in a bid to enhance its appeal and better retain customers.
How it works: This time around, Starbucks Rewards will feature three tiers: green, gold, and reserve.
Why it matters: Starbucks’ overhauled loyalty program is the company’s latest effort to address pain points that have kept customers from visiting its stores. Unlike the previous system, which made no distinction between regulars and occasional visitors, the revamped program is designed to reward the chain’s most loyal customers—and incentivize everyone else to visit more often.
By making the perks more desirable, the goal is to drive more customers to use Starbucks’ app, which enables the company to offer more targeted, personalized promotions that encourage more frequent visits.
Implications for retailers: Loyalty programs are only effective if companies can consistently deliver product and service quality. Two-thirds (67%) of consumers cite consistency as a leading driver of loyalty, compared with 36% who point to loyalty and rewards programs, according to an October Net Conversion report.
While ensuring reliability can require costly investments—as Starbucks well knows—they are necessary to ensure that customers have a reason to come in in the first place.
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