The newest version of the Starbucks Rewards program still leaves a lot to be desired. I’m rewarded for the number of transactions I make, not how much I actually spend. If I had the time, and I may still try this sometime, I’d ask the barista to ring up each item separately each time I visit, in order to earn a free drink sooner.
While I’m commenting on Starbucks, it’s always irked me that the employees don’t wear name tags. Starbucks wants me to think of it as my “third place” after work and home, but they also want me to have to ask for and remember their employees’ names? I think not!
I’m still not impressed with the Starbucks Rewards program. Karen received one of Starbucks’s key chain loyalty cards several weeks ago with few dollars loaded on it, but I still haven’t received one, and I spend a lot more at Starbucks than she does (because I’m the one who usually who goes out to get the coffee). So much for recognizing my loyalty!
Starbucks clearly has its work cut out for it, as coffee drinkers continue to seek less expensive ways to imbibe at the expense of premium coffee providers, according to the Wall Street Journal:
As consumers gravitate toward cheaper beans, higher-quality coffee retailers have been affected to a greater degree by the economic downturn.
Caribou Coffee Co., of Minneapolis, earlier this month reported fourth-quarter 2008 earnings of seven cents a share on net sales of $68 million, a 3% decline from a year earlier. Net sales at its coffeehouses open more than a year fell 5.1%, as 230 stores have closed their doors since the 2007 fourth quarter.
Caribou is the third-largest company-owned gourmet coffeehouse operator in the U.S. As of Dec. 28, 2008, the chain had 414 company-owned coffeehouses and 97 franchised stores.
Starbucks Corp., the world’s largest coffee chain, posted a fiscal first-quarter revenue decline of 5.5%. In February, the company began the process of cutting 6,700 employees, or 4% of its work force.
In an effort to offer more attractively priced fare, Starbucks has entered the instant-coffee market and is pairing breakfast items with a cup of coffee for $3.95.
High-end coffee retailers “have to convince the consumer that they can drink much better quality coffee for just a little bit more than what you can make at home for a lesser-quality coffee,” said James Cordier, coffee analyst and founder of OptionSellers.com. “That window may have closed already, but there’s a chance they can keep their customers by offering quality coffee at a discounted price, because once people invest in that good coffee maker at home, you’re done,” he said.
Karen and I continue to cut back on our own Starbucks visits, both to save money and to cut down on our caffeine usage. It doesn’t help Starbucks that they have done nothing to increase my loyalty over the last several months.
Original Post 10-31-08:
Karen and I spend too much at Starbucks, but it really is one our one indulgence (that and eating out or doing take-out dinners with the kids when we’re both too tired to cook). Starbucks knows how much we spend there, because we both use its card which automatically reloads a set amount when ever the balance goes below $5 (or any predetermined amount).
Why then do I have to shell out even more money, or make the drive out to Costco (where we do have a membership), wasting gas in the process, to get rewarded for my loyalty:
One of the moves is a new loyalty card aimed at Starbucks’s most frequent users. In the next few weeks, the company plans to introduce a Starbucks Gold card. Customers will pay a $25 annual membership that will give them 10% off most purchases and other perks. The company also has started selling Starbucks cards at Costco Wholesale Corp. outlets for a 20% discount. Mr. Schultz said Wednesday he doesn’t anticipate the chain will make any changes in its price structure.
It wouldn’t be too hard to automatically integrate with my current Starbucks card, providing me with a 20% rebate or adding free drinks if I spend a certain amount of money at their coffee shops each month. Starbucks may think it is getting more new customers by selling its 20% off card at Costo, but they are irritating me in the process.
Starbucks is giving me yet another reason to quit going there and put the money I’ll save into my heavily depleted pension account.