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Why Loyalty Matters at Starbucks

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Why Loyalty Matters at Starbucks
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The next time someone asks you for an example of whether loyalty matters in today’s market, you can refer to an article in the Navigator, published by First Annapolis Consulting. Navigator is a great resource and you can subscribe here.

John Grund and Allison Brenner combined to share summary statistics for My Starbucks Rewardssourced from public filings including Starbucks Investor Relations and Starbucks 2013 Quarterly Earnings Calls.

A few highlights:

  1. In 2012, customers prepaid for over $2.9 billion worth of future purchases using the Starbucks Card
  2. The Starbucks Card accounts for 30% of all US transactions
  3. The Starbucks mobile app, tied to the Starbucks Card, now accounts for 10% of all US transactions
  4. Nearly 25% of US transactions are associated with My Starbucks Rewards

The impressive penetration of the card has expanded beyond US borders. China has 2.5 million My Starbucks Rewards members and penetration on the card product exceeds 35% of total tender in China.

Starbucks has identified a way to deliver high value and convenience to its customers at the intersection of loyalty, payments, and technology. It’s an example that is more than just another case study to put in your next presentation. It’s a trend to watch, and we suggest you consider how it might fit into your business to build customer loyalty as well as shareholder value.

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