The Starbucks loyalty program demonstrates growth in not the most favorable conditions for activating positive trends.
Source: Pixabay.com
The negative conditions are that the company has made changes in the structure of remuneration for the interaction of consumers with the brand exclusively in its favor. But clients continue to participate in the program, adhering to the belief that loyalty applications offer benefits even when the company demonstrates some greed to reduce costs.
The coffee giant last Tuesday, May 2, published the results of operations for the second quarter of fiscal year 2023. According to these data, the Starbucks Rewards app continues to gain popularity. The number of active users of this application increased by 15% year-on-year and amounted to almost 31 million.
Laxman Narasimhan, the brand’s new CEO since March, announced a record high level of transactions related to Starbucks Rewards. In the structure of the company’s operating revenue, the share of the loyalty program is 57% according to the results of the second quarter of fiscal year 2023. This figure is 3% higher than the result of a year ago.
The CEO of the brand said that the company is pleased with the increase in the number of participants in the loyalty program, and noted that this trend contributes to the formation of a steady level of demand. He also says that Starbucks is one of the pioneers in the field of customer compensation and intends to continue to direct investments in the implementation of relevant business solutions.
The increase in the number of Starbucks Rewards participants is indicative, as it demonstrates that consumers will continue to receive rewards even when the brand decides to reduce discounts. The February changes to the loyalty program included doubling the number of points required to receive hot coffee, baked goods, and hot tea while reducing by a third the number of points required to receive cold coffee and iced tea. Consumers perceived this decision of the brand as a devaluation.
Experts say that a discount in any size and format is attractive to consumers who are always interested in offers that reduce the level of their financial spending. For example, in February in the USA, according to the results of the study, 26% of restaurant visitors paid a reduced price for their last purchase. In March last year, this figure was equal to 14%.
The demand for discounts and incentives is higher at Quick Service restaurants (QSR), such as Starbucks. The results of the study indicate that in the USA 49% of the customers of these establishments are members of loyalty programs.
The expansion of the scale of consumer interaction with Starbucks is not only indicative, but also surprising in a certain sense, because customers of fast food restaurants expect significant discounts, and in this case, their expectations are faced with the opposite decision of the brand. At the same time, the application of this company has those indicators of consumer activity that the mobile platform of any other restaurant does not have.
As we have reported earlier, Starbucks reinvention plan includes Web3 rewards program.
