Today I thought I’d compare the loyalty programs of the two coffee shops closest to me: Starbucks (of course!) and Peet’s.
As of this writing there is still no ‘official’ Starbucks Android app, so I’ve been using the popular third party Starbucks card app by Birbeck. I was at the Starbucks yesterday at the US Bank tower in Portland. Whenever I’m there, I notice a lot of people whipping out their smart phones and holding them against the bar code scanner to redeem cash from their Starbucks card, and in so doing, earn points on Starbucks Loyalty Program. There was a lull in traffic so I asked one of the baristas (‘partners’) approximately what percentage of folks are paying using the mobile app. I was impressed to find out that according to their estimates. . .about half of the customers pay this way!
I have to admit, its a slick application, and to my knowledge, is the first popular implementation of the ‘virtual wallet.’ Even though the points are not loaded real time (not sure what the process is to confirm my star. . .perhaps after the transaction batch is transmitted), the convenience of not having to carry around an extra plastic card in my wallet is compelling.
So the execution of the Starbucks program is truly superior. . .but how about the value?
On the value scale, Peet’s is the better choice. . .at least based on my drink purchasing habits. Peet’s has the old school plastic card. And yeah, I hate having to carry that in my physical wallet. Still, with a $25 reload of the card, I get a free beverage of my choice.
My drink of choice is a 12 oz. latte with two shots. Lets do the math.
Peets: 9 visits x $2.80 Small Latte (two shots standard) = $25.20
Starbucks: 15 visits x $3.10 Tall Latte (add shot) = $46.50
So assuming the only thing I buy is a 12 oz latte with two shots, it takes only 9 visits at Peet’s to earn my reward vs. 15 visits at Starbucks. . .In dollar terms, I have to spend 84% more at Starbucks to get the same reward.
Also, this benefit at Starbucks is only availableafter I attain Gold status at 30 visits. Its on the 45th visit when I get my first reward! (I’m still stuck in Green status).
Overall Advantage: Peet’s