The $63 Free Cup of Coffee.

Establishing the Value of Loyalty from Your Most Loyal Customers.

I guess I didn’t get many gold stars when I was in elementary school, which probably explains my subconscious need to hoard them all on my Starbucks app. Wednesday Double Star days; stars for the Menu Challenge; Stars Dash, Star Flavour, Gold Stars for grocery purchases…all leading up to my Gold Status. Take THAT, Ms. Deaver!

After all, Starbucks has perfected the art of doling out stars—and having us pay for the privilege. 125 stars gets us a free cup of coffee. Do the math and that’s $62.50 (excluding bonus star days and promos) for a drink or pastry of our choice. What restaurant brand wouldn’t want that kind of “star power” and return on investment?

The move to loyalty stardom for Starbucks occurred when they shifted from a visit-based program to a spend-based program. In its first iteration, customers received one star per visit, and it took 12 stars (visits) for a free reward. If you figure that an average grande-sized cup of standard, black coffee is $2.10, it would cost you a little more than $25 for that free reward. This resulted in higher return on incentives for those who actually spent less. Fast-forward to the brand’s new system launched in 2016 and the higher spenders are incentivized more, but now the stars are based on spend versus visit—and that free reward at 125 stars now costs you almost double.

Spend. Visit. Frequency. Promotion. Reward. Redemption. Engagement. These are all viable ways to gauge loyalty. But loyalty programs are only as good as the number of people who use them, how frequently, and if they truly drive repeat business.

Which still begs the question: are we really okay with paying $63 for a free cup of coffee?

For over 15 years, Push has significantly increased guest count, check average and comp sales by providing branding, marketing and media for many of the restaurant industry’s best-known brands.