HBS Case Study Analysis

STARBUCKS LOYALTY REIGNS

MKTG 5606 | Jennie Nguyen

MY STARBUCKS REWARD (MSR) & STAR SYSTEM★ Speed: fastest way to pay★ Efficiency: monitoring balance★ Convenience: reload card amount★ Incentive: track your progress via

stars to earn free drinks

FOUR PILLARS

OUTSTANDING KPIs ENABLED BY MOBILE2011 2012 2013 2014 2015

By end of year, 9M of 45M

customers were paying by

mobile each week.

1st edition of app launched

(digital version of Starbucks

Card) led to a high adoption

rate.

Invested in Square -

streamlined store experienced and enabled Mobile Order & Pay

feature

Served mobile ads via MRAID

and geolocation

assisted customers to

find the nearest shop.

Earnings:$16.4 billion

Earnings: $19.2 billion

Earnings:$11.7 billion

Earnings:$13.3 billion

Earnings:$14.9 billion

Integrated Twitter to

purchase coffee for friends via the mobile app using payment

feature & handle

reference

In one year ...

MI

ST1.) Utilizing Twitter to enact a paid media campaign via @tweetacoffee,

combined social and mobile. 2.) Additionally, 94% of Facebook users were fans of Starbucks or

friends with someone who was.

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App interface is completely a native app, rather than a responsive version the website. The mobile app’s utility is designed for on-the-go ordering (GPS) and electronic payment (scan bar).

App contains exclusive features (i.e. Itunes downloads) and promotions (i.e. bonus stars on Sunday) not available on other platforms. These offers are unique only to a mobile user.

App stores an archive previous purchases, payment history, and rewards. For each subsequent visit to the app, the interface is updated according to the last interaction utilizing the app.

Suggestive SellingA la carte items are suggested to complement orders

STARBUCKS MOBILE CONTENT Store Inventory AvailabilityAvailability for a particular item is communicated during online ordering.

Prior Order RecaptureOrder history is available to enable a seamless future purchase of a customized beverage/food

News/Offers

-“Pick of the Week” allows free apps weekly via the app store.- Updates on Starbucks products and upcoming promotions

EXTENDING PURCHASES & EXPERIENCE OUTSIDE THE FOUR WALLS OF A STARBUCKS STORE

DELIVERY SERVICE SUBSCRIPTION SERVICE

Postmates only exists in densely populated areas (i.e. cities)

Uber Eats could provide coverage for regions with a large range of distance

Similar to Dollar Shave Club, those who purchase goods (i.e. kcups & bagged beans) can subscribe to a regular subscription that can be delivered or picked at their local store at a specified time.

Scheduled drink pick-ups for extreme mobile-device regulars, a service can be offered where they can schedule their account to automatically order the same drink as often as they prefer.

SOURCES

◈ Darden Business Publishing, University of Virginia. (September 26, 2016). Starbucks Loyalty Reigns.

◈ Investors.Starbucks.com

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