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Starbucks Digital Network: A Different Name For Loyalty

Starbucks has tried a variety of media plays in the past (magazines, music) as brand extensions, with varying success.  This digital program is a horse of a different stripe, however, and appears to be a platform that will keep the brand in a position to leverage new technology to drive loyalty benefits.  It makes their stored value card initiative look positively, well, old-school.

“Imagine a Starbucks patron is reading a review in the free version of the New York Times about a Chardonnay and suddenly their iPhone buzzes. A text coupon arrives in your mobile inbox and you are offered $5 off a wine purchase of $20 or more from a local wine purveyor. The coupon has a timed code and expires in 3 days, nudging you to act. The era of the hyper-relevant advertisement is upon us. And that example is just scratching the surface.”

This is part of a larger, quickly emerging trend of location-based, personalized, opt-in promotions and marketing.  A key development appears to that this does not stitch together commodity services like Foursquare, but is retailer-branded and unique to the experience at Starbucks. That has enormous differentiation benefits.

Although it is retailer-specific, the hypothetical contemplates an affiliate program that may – or may not – dilute the underlying purpose of getting people to and keeping them in a Starbucks, but in any case adds a level of operational complexity we won’t likely see in the near future.

We look forward to checking it out – at one of the dozens of Starbucks within shouting distance.

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