A Coffeehouse of Customer Convenience

For Starbucks, serving as a ‘third place’ between work and home has always been at the forefront. To achieve its vision of forming better connections with its consumers, it laid the groundwork in 2001 when it first introduced the Starbucks Card, given initially to partners as a prototype before being officially launched to the general public. A bit more fine-tuning over the years resulted in the Starbucks Card rewards program, and eventually, the Starbucks Gold Card that catered to the Starbucks “super users” with extra freebies and in-store benefits.

2009 saw the consolidation of both concepts to form My Starbucks Rewards, which was in line with the launch of the Starbucks Card Mobile application. By allowing US users to check their balance, reload their cards, and view transactions, the coffee juggernaut focused on delighting its customers with the ease of convenience. In the following years, as technology progressed, so did Starbucks’ adoption of the same to track purchase frequency, analyse performance indicators, and empower dynamic rewards. Customer-centric rewards meant tapping into customer preferences and behaviours, which meant automating offerings that drive customer retention as well as lifetime value – placing the company under titles of “neobank”, “FinTech’, and even “an unregulated bank”.

This was accompanied by achieving a more frictionless payment service for its US members, topped by the amenity of having varied payment alternatives:

• • Starbucks embraced mobile payments by teaming up with Square, shaking up the retail space by giving customers a quick way to explore nearby businesses, browse menu information, store hours and transaction history, all on their phones.

• • It later selected J.P. Morgan’s Chase Commerce Solutions as its payment processing tool, laying the foundation for a nationwide rollout considering the wave of innovation in the digital payment ecosystem.

• • By joining forces with Amazon, Starbucks came up with the “Starbucks Pickup with Amazon Go”, a store concept that lets customers bypass the checkout when they pay for pre-orders via the Starbucks app.

Now, the next thing to tick off its bucket list was ensuring the same customer convenience and human connection on a global scale:

• • In the UK, Starbucks joined Barclaycard for contactless payments, becoming one of the few high street retailers who were introducing payment technology.

• • Linking the technology play to human perception, Starbucks Japan released Starbucks Touch: The Pen – a pen with a built-in NFC wallet to pay for things.

• • Transporting to the deserts of Saudi Arabia and UAE, Starbucks and Visa helped accelerate the use of Apple Pay by offering Visa cardholders free upsize/upgrades on their orders when paying with Apple Pay.

• • It forged a regional partnership with Grab’s delivery network across Southeast Asia, bridging the ordering and in-store channels to continue making the Starbucks Experience more fulfilling.

• • It also partnered with Vietnamese e-wallet MoMo, further hoping to enhance and bring a different style of experience to customers.

The Third Place Connection to Web3

Already en route on the digitisation path, Starbucks also dipped into the curiosity around the virtual world. The coffee-titan began crafting its Web3 journey back in 2018, where it collaborated with Microsoft to allow crypto payments for its products. A year later, it struck a deal with the eagerly awaited Bakkt Bitcoin trading platform in exchange for the use of Bitcoin by customers in its stores. These collaborations opened doors for tapping into the potentially huge market, increasing the chance of popularity amongst crypto fanatics for Starbucks.

Proving its commitment to ethical sourcing, it trode down the path of blockchain adoption in 2020 to enable customers to have digital, real-time traceability of their coffee from farm to cup. Powered by Microsoft’s Azure Blockchain Service, the initiative intends to not only empower farmers with more visibility of their hand-picked beans, but also let customers view their purchase’s impact. It wasn’t until 2021 that Starbucks actually began to leverage the now-launched Bakkt wallet for Bitcoin payments in the US. In the same year, it expanded its payment services to include Bitcoin in El Salvador, the same time the country adopted Bitcoin as legal tender.

The company is ardent in enabling experiences that will allow its consumers to engage in new ways with the brand and as a community. Its most recent move in leveraging Web3 revolves around unveiling the Starbucks Odyssey – offering its US members and partners the opportunity to earn and purchase digital collectable stamps (NFTs) that will unlock experiential benefits that are uniquely Starbucks.

The Pursuit of Doing Good – One Connection At a Time

Elevating the customer experience while creating a positive impact on communities is what Starbucks aims to accomplish through its many ventures. Reaching the level of satisfaction that is savoured right from the first sip throughout the checkout journey is surely a whole latte work. With customer expectations getting more grande by the day, the coffee chain’s pursuit of rewarding its members with more of what they love only grows stronger and helps it to indulge in offering the best of tech and experiences.

And while they still can’t seem to get the names on the cups right (sorry Starbucks), they’re well on track in providing consumers the full coffeehouse experience, inspiring and nurturing the human spirit – one person, one cup, one neighbourhood, and one rewarding product at a time.