Starbucks Loyalty Reigns Case Solution

1. Which Starbucks Rewards feature in the mobile app is most valuable to the company? 

The most valuable feature in the mobile app is the MSR, namely My Starbucks Rewards. This was announced by the Company itself, whereby they declared that MSR is their biggest revenue generator. There are several features in the MSR app. These include a payment management feature for linking Pay Pal or Credit card to the app and operating it as a debit card, a Gift Card feature where users can send gifts to other users, a Rewards screen that collected stars on customers’ purchases at Starbucks. The most valuable feature under the MSR was the Rewards screen which offered rewards to customers if they shopped at Starbucks stores within malls or bigger stores, if they bought some products marked as premium, if they made some online purchases, or if they shopped at La Boulange. These helped the people earn stars on the Rewards screen, which rewarded them in the form of free drinks or snacks. 

This feature was the most valuable one since it helped Starbucks attract more customers and resulted in increased sales. It also helped them retain customers for the long term since the Rewards app increased loyalty among customers and encouraged them to use the app consistently. Rewarding customers for frequent usage of the app and for showing loyalty to the brand has helped distinguish Starbucks from other brands. It has also made Starbucks’ customers feel valued since they get a return for purchasing. It has acted as a great loyalty program for Starbucks. Since Starbucks was among the first very few brands who adopted such important technological ideas and marketing tactics, it paid off as the company was able to earn the first mover’s advantage. Hence, the app has been profitable for Starbucks and has helped in driving revenue for the Company as announced by the company itself. 

2. Could Starbucks have been as successful if it had offered only a physical Starbucks Reward card, and never introduced the app? 

Starbucks could not have been as successful if they had not switched to the mobile app from the physical card. There are several reasons for that. First, as technology changed, it became important for Starbucks to mend its ways so it could keep up with the advancement. Since mobile penetration was increasing rapidly in that era, people were relying more on mobile phones. In such a situation, people found such apps fascinating and fancy, and they liked to start using those apps. Secondly, switching to a mobile app was more convenient for the customers. When customers use loyalty cards, they can forget it home when visiting the outlet. There are also chances of losing the card since it is in physical form. Switching to a mobile app made it convenient for customers since people hardly forget their mobile phones at home.