Company | Profile
In 2016, Starbucks redesigned its rewards program with a new loyalty logic—and managed to speed up lines and boost year-over-year revenue 11%. The coffee chain’s former program prized transaction volume over dollars spent. That meant it could be gamed by people who rang up things individually to earn more points, which caused line congestion. (It was one star per purchase, 12 stars = a free drink). The new system (two stars per dollar spent, with 125 stars = a free drink) reduced transaction time, improving the in-store experience for everyone. Starbucks also expanded the program into a new kind of network, building in bonuses for people who use partner services like Lyft and Spotify. All told, the company actually added 16% more members in 2016, to a total of 12 million. Meanwhile, additional in-store offerings like nitro cold brew and caramel iced macchiatos appear prescient—that market is projected to double within the next three years. Starbucks is also hoping to streamline purchasing with its My Barista App, which promises to allow voice- and message-based ordering.