Starbucks is rolling out a new system to convince you to buy exactly want it wants you to buy
The coffee giant is in the early stages of rolling out a new personalized rewards program that will allow it to push certain products and incentives to customers based on what it already knows about them. Each Starbucks customer will receive completely unique offers via email and the Starbucks app.
For example, I typically go to Starbucks for an iced coffee as an afternoon pick-me-up. Since I use the app, Starbucks knows exactly what I buy and when I buy it.
According to Starbucks' chief technology officer, Gerri Martin-Flickinger, starting in early 2017, the Starbucks app will likely prompt me to add some food items to my order. Starbucks may even sweeten the deal by offering extra rewards points, or "stars," if I buy a pastry.
A customer who doesn't visit Starbucks regularly may be offered rewards points for simply going more often.
"We can now use stars as incentives for personalized behaviors," Matt Ryan, Starbucks' global chief strategy officer, said at Starbucks' Investor Day in New York City on Wednesday. Generally, customers earn two points for every dollar spent.
The Starbucks app already collects a lot of data about you. It knows what you order, how often you visit Starbucks, what time of day you go, and where you live.
To figure out how to best convince customers to spend and shop more, Starbucks draws from factors like customers' established purchase history, listed preferences, account info, and even the local weather - think an iced coffee deals on a hot day.
The company says the new program, which began its mobile rollout two weeks ago, is already leading to increases in how often customers are visiting Starbucks and how much they are spending.
Starbucks is also creating new "star earning" opportunities with partnerships that will allow customers to earn stars by shopping elsewhere. A partnership with Chase and Visa, for example, allows customers to load money onto a prepaid Starbucks Rewards Card that can be used everywhere Visa credit cards are accepted.
Personalization will also extend beyond the app.
"Any screen can become a personalized screen moving forward," Ryan said.
That means everything from a drive-thru window to a smartwatch could soon push deals that specifically cater to each individual customer.
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