My Starbucks Rewards Goes Revenue Based… And I Like It!

Is there anything we collectively dread more than airline loyalty programs going revenue based? These types of changes are bad news for most of us, and great news for some (super high revenue) flyers.

While not an airline loyalty program, I’m also a big fan of Starbucks. It’s not that I love their coffee as such, but rather that I like getting a consistent experience no matter where I go. I go to Starbucks on a near daily basis, and they have a pretty cool rewards and elite program, called My Starbucks Rewards.

My-Starbucks-Rewards

Under the current program you earn one star for each “visit.” After earning 30 stars you get Gold status, and when you have Gold status you earn one free drink after every 12 stars.

There has always been a way to “maximize” the star system a bit, because of how stars are earned. You earn one star for every transaction. So if you buy three things in one transaction you’d get one star. If you broke it up into three transactions, you get three stars, though.

I’ve never maximized the star system, because I can’t bring myself to make the transactions more complicated for baristas. There’s usually a queue at Starbucks, and I don’t want to delay others due to my love of maximizing loyalty programs.

Well, My Starbucks Rewards will be going revenue based in April, meaning you’ll earn stars based on how much you spend rather than how many transactions you make.

https://twitter.com/SbuxGeek/status/700784641712623616/

Under the new My Starbucks Rewards program:

  • You earn 2 stars per $1 spent (rather than one star per transaction)
  • Gold status requires 300 stars (rather than 30 stars)
  • You need 125 stars for a reward (rather than 12 stars)

In other words, you need to spend $150 to earn Gold status, and you need to spend $62.50 to get a reward.

When comparing the old and new program, this makes the “breakeven point” per transaction ~$5.21 for the purposes of earning a reward, or $5 for earning Gold status.

So if you usually order “fancy” drinks or multiple things, you’ll probably come out ahead under the new program. If you usually just order a coffee or split up transactions, you’ll probably come out behind under the new program. If you’re buying coffee for the whole office, you’ll love the new program.

Bottom line

It’s interesting to see My Starbucks Rewards go revenue based. While I don’t like airline loyalty programs to be revenue based, I personally view this as a huge positive for something like Starbucks. My typical Starbucks order is a cold brew and a spinach feta wrap, so I’ll come out ahead under the new program. And this isn’t exactly “high roller” behavior on my part.

For what it’s worth, the details of the new program haven’t yet been officially announced, but rather just communicated to some associates.

What do you make of My Starbucks Rewards going revenue based? Will you come out ahead?

(Tip of the hat to View from the Wing)

Comments

  1. Seems like a devaluation because the average check is certainly below $5, but certainly understand the logic.

  2. You see, Starbucks are operated by sneaks. Order a tall coffee and with tax it comes just under $2.00. Let’s say $1.98. You get 1 star. Yep, a socialism standard.

  3. I wonder if I buy and load $300 credit on my card annually I will automatically make Gold status. I used to go to Starbucks daily for a venti cold brewed iced coffee, but ever since Trader Joe’s started selling their fantastic cold brewed coffee concentrate and can have the same (or better) quality at home with not needing to brew the coffee. Therefore I’m going to Starbucks less.

  4. It seems they want to curb abuse of the program, by going revenue based, but not too much (Birthday drinks are still a thing…)
    Does buying a gift card with a starbucks gift card actually still reward a star under the new rules (seeing as you spend 5$ or more on a gift card)?

  5. Huge devaluation. With Mobile Ordering, it was very easy to be able to do multiple transactions and not inconvenience baristas. I was getting a free reward every $30 or so. Oh well.

  6. I hope they bring revenue based to the UK it irritates me that its transaction based, as I usually use the card for two people and usually by snacks at the same time my one transaction can be pricey.

    Although is the free drink thing the only benefit in the US? Is this the one loyalty program where the UK has better benefits.

  7. I have come to the realization that most people are cheap. And they make fun of other people for being cheap. Maybe they are trying to convince themselves that they are not cheap.

  8. @ Melissa The best way to get a star (and will be eliminated bay going revenue-based) is buying the cheapest item on the menu…(here in Europe) a golden choclate coin for 50 cents. Do 30 separate transactions at a total coast of 15€ (30*0.50€) and you have reached gold status and get your gold card. I complete this in a matter of hours every year…

  9. I don’t mind the ‘idea’ of a revenue based program, but the redemption rate for a single free drink (and I usually order only a tall) is ridiculously high. Don’t like it.

  10. My typical transaction is $2.70 and maybe one $5 item every dozen, so call it $35. My typical redemption is $5 (Grande flap or latte, either with extra shot). So I was getting 12.5% back. Now it will be 7.4%, so a 14 cent increase on my typical drink.

    I can live with that at work. Less likely to patronize them on the weekends.

  11. As a gold member, I often got targeted promotions, like the other day “get two bonus stars for buying a latte”. I buy a tall latte, boom , three stars. Order is $3.75, avg. redemption after 3 or four drinks– redeem for a triple Venti anything at about $7.00. New system sucks for me.

  12. Luckily I have Gold until December 2017. This change doesn’t sound good for me as I’m an infrequent customer and I try to take advantage of bonus star offerings. Case in point, I earned about 60 stars in the last 2 months and really only paid for maybe 4 drinks. I’m sure the new program will continue offering bonus stars in some way, but I don’t think it will be as lucrative.

  13. Given that most of my Starbucks visits involve drinks for both my wife and I or treats for the office, I’ll probably benefit overall. The question for me, though, is what happens with those lucrative “bonus stars” opportunities. If those get watered down, not good.

  14. I used to maximise my stars by buying tall drip coffee and then redeeming for an ounce of loose-leaf tea at teavana or a food item. $2 a drink = $24 for a reward. If you get the most expensive tea it’s about 10$ for an ounce, if you get one of the salads it’s just over $10 and is a substantial meal. That was really good. On the other hand, and I know that this only applies in Canada and the USA, I buy tea a lot so the money based redemption may very well work out in my favour. I wonder how bonus stars will work going forward because I can usually get at least one star per reward from doing their customer satisfaction survey that is sent out every once in a while.

    In case people didn’t know, Teavana also gives and redeems stars.

  15. Here in India the Starbuucks loyalty program has always been revenue based. Well SB opened opened up a year a so ago. 1 point for every ₹300/- spent.

    My only grouse about this loyalty program is that it is limited to specific markets. Like I cannot earn points on my Starbucks loyalty card when buying coffee at a SB in Paris since I signed up for the program in India.

    I find it rather ridiculous as Starbuucks is a worldwide chain.

  16. This is NOT good! I generally spend $30 to get 12 stars. Now I’m forced to spend $62.50. I’ll probably visit Starbucks less now…Damn shame.

  17. My Starbucks Rewards in Thailand has always been revenue based since its inception.
    Furthermore, the requirement is much more higher than US.
    Basically, 100 Baht (~3 USD) earns you 1 star and you need to earn 250 stars for the gold status…
    So to earn gold status, you would need to spend around 750$.
    There are some promotional period when you earn double star but that only come once or twice a year.

  18. Terrible coffee and also serves drinks with massively high calories disguised as something benign. A company that doesn’t bother about its tax obligations in most countries in which it operates but plays the PR spin game of being all Eco-friendly and warm and fuzzy. Awful company, DREADFUL coffee.

  19. Sucks for me as I only buy the regular coffee. But for me the main draw of the Gold card was the free refill so I’ll be OK.

  20. Starbucks has always been revenue based here in China. We need to spend about 200 US to get Starbucks Gold(25 stars) ~8US per star. It is kind of disappointing that Starbucks doesn’t have a higher threshold, Starbucks needs a platinum tier with at least 1k in spend. I buy at least three drinks at Starbucks a day and want better benefits.

  21. I’m one of the low-ticket customers (tall, black coffee, no flavoring or whipped shennanigans) who has been getting good value from the current rewards program and will lose under the new one. I get it though.

    My gold status is through April 2017 so my visit habits won’t change since I’ll still get the free refills and presumably birthday reward. At my spending level I’ll lose two or three free cups of coffee a year. No big deal.

  22. Oh no, first the death of RedCard, then BlueBird, followed by Chase going to max 5 cc accounts in 24 months, and now THIS. 🙂

    My perspective may be colored by the fact that I only patronize Starbucks when traveling in Europe, where refuse to take my “American” Starbucks card. And even then only when I can’t find a Costa or Einstein store. At home I make my own, far better Mocha Lattes, rather than the sickeningly sweet thing Starbucks makes.

  23. Massive deval for me. Usually get hot chocolate or handcrafted soda. Price is lot less than $5.

    Not worth status for me now.

  24. Boo! Bad plan for customers! I have enjoyed being a gold card member for years, mainly buying lower priced items and tall flavored lattes. This sounds like it will be much more of a challenge to get rewards. I have also persuaded friends to go to SB more often to get gold cards and rewards easily, but now it will be more difficult for everyone.

  25. Not a very good program with the new plan. My $2.98 tea will only get me 2 stars. I’ve been gold since the pilot test program, but I guess I’ll start brewing my own teas at the office.

  26. $62.50 (125 / 2) for a free reward instead of 12 purchases. So now you’ll have to spend, on average, $5.21 per purchase to get the same value from the program as before.

  27. Here in Houston, the price of my go-to drink (Grande Nonfat Latte) is $3.95. For the redemption I always get a Venti Nonfate Latte, which I believe is $4.10. With the old scheme, I was getting an effective 9% rebate. Now it will be down to 3%. Still better than my cashback cards, but much worse than I can otherwise do with most other cards. We have a teacher in the family so we get a ton of SBUX gift cards though…

  28. To get extra stars ring up your items separately. For example for your cold brew and spinach feta wrap, you ring up each separately at the same transaction and get two stars. If you were ringing up your items separately then this is a major devaluation. How about free refills for gold status? Is that still the policy?

  29. I like the change. My wife and I recently met our daughter and granddaughter at a Starbucks for a visit. I spent nearly $30 on drinks/snacks for the 4 of us, but was awarded just one star. From what I understand about the program change is as of April, I would earn 58-60 stars for a similar transaction. Much better!

  30. Looks like a money grab to me. Their first reason was that people complained about people making separate transactions at the register so they HAD to come up with this plan. BS. How much time gets wasted by people waiting to microwave their Bourgeoisie Bakery item to ‘wake up the butter’? My concern now is if you already have 30 stars for the year are you gold for 2017? I’m starting to suspect not. Not to worry, the competition will be glad to step in and take care of Starbucks former customers.

  31. Over all most SB customers will LOSE!!! What a clever way to increase revenues for the corporate giant. Disgusting!!!!!! What a bunch of crap esp. the claim that the change is based on customer requests. Yes please charge me more for my daily coffee from starbucks. Because they don’t charge enough for a mediocre cup of coffee. Just lost another customer.

  32. Just posted a critical comment on the new SB reward rip off program and the comment was deleted. All I said was corporate greed raises it’s ugly head. And use the “customer requests ” for a change in the rewards program as a way of justifying a huge increase in price for those frequent customers. Pretty disgusting Starbucks. Good thing Peets is close by.

  33. I buy a Venti dark EVERY day. $2.63 everyday. On weekends I get a 2nd or 3rd drink. I average a free beverage every 10 days or less. I spend $1,400 a year on this for the past 4 years. But under the new system I’ll get a free coffee every 31 days on average. Now double this because my Wife also spends $1,400 a year but she buys more expensive drinks.

    Guess Starbucks will do what my wife hasn’t been able to do. Make me use my Keurig in my office instead. I save the time in line, no morel leaky cups, and $2,800 a year. Thanks Starbucks!

  34. Ben, your math is clearly wrong. You should crunch the numbers and rename your article “… and I don’t like it.” Even if you buy a fancy drink, let’s say $4.65. You are still going to have to purchase about 14.5 instead of 12 to get a free one. And for those of not trying to consume a daily 1,100 calorie drink, it’s a bigger gap. I’d have to purchase almost twice as many cups of black coffee.

  35. I dislike the new program as well.

    Not sure what their average customer transaction is, but most of my transactions are one drink, so under the old program it works better for me and I think for most customers. For example, if my average transaction is a $3.00 drink, I would go to gold at 30 transactions or $90. Under the new program it is $150 to get to gold, that nets to a 66% change upwards in the program!

  36. This is unfortunate. One of the core reasons I choose Starbucks over the dozen other places around where I live/work is because of the current program. If I get a coffee for $1.95/day, 5 days a week, then it only takes $23.40 to get a reward. Then I’ll use the reward for a “fancy” drink on the weekends, say, something that would normally cost $5-$6. Let’s say the reward drink cost $5.50, then I’m getting a 23.5% return on my spend. Based on what is reported above, my return on the new program would be 0.088%.

    Still better than nothing, but not enough to make me walk an extra block when I’ve got the choice of something better.

  37. I’ve been a Starbucks customer for over 20 years and a gold card member for the past few years. When I heard about the new program, I immediately looked at it and rapidly came to the conclusion that this is not to the customer’s benefit. I don’t care how Starbucks tries to spin this, most customers are going to lose on this. I think it is utterly ridiculous that one has to spend more than $62 to receive a reward. Mark my word, if everyone goes along with this so-called “rewards program,” Starbucks will find another way to cheat the clients once again. I’m really very disappointed in Starbucks. It seems to me that the company has lost sight of its focus on pleasing customers and listening to customers. Clearly, if they were listening to customers, they would realize that this change was really a bad move on their part. I never thought I would ever hear myself say this, but I think I’ll be looking for a new place to spend my money…….one that respects and honors my business. Wake up and smell the coffee, Starbucks!! Is it really worth it when your customers are pissed off and making decisions to do business elsewhere? Bad business decision!!

  38. I agree this is not a good move. In Canada one can go to the golden arches and get a better cup of coffee and get a free one after buying 6.
    I will let my Gold status lapse.

  39. I love it. We usually eat lunch there and buy drinks and the tab is around $20 per visit, so I’ve been getting screwed all these years getting one star per visit. The worm has turned, deal with it.

  40. I’m a low ticket item buyer. Now I have buy 64 drinks to get to gold, and about 29 more to get my free drink…. Yay free drink after 93 drinks!!! Not worth taking my phone out to buy…. I understand that the people who buy those luxurious drinks of 5 dollars get rewarded but Starbucks just pissed off the people that drink regular coffee everyday. Let’s just say I won’t be running into Starbucks as much and going to my local coffee place way more often. The rewards are getting worse and worse now 🙁

  41. I have mixed views about this new program. It just went into effect and I have yet to go (just have not had time). I might go 3-4 times a month. So not as often as many people, but I go often enough to have a gold card.
    If I ever went on a very slow hour in the suburbs, I was one of those people that would break down the bill… I’d get my iced chai on one transaction and banana bread on the other. I NEVER did this if the line was crazy though. I spent about $2.75 on the banana bread and about $4.25 on the grande chai. So it is nice to know my “usual” will get be 14 star points. The only annoyance will be having to get 300 star points for a free reward. Why implement a system that does not favor customers? It reminds me of when Starwood properties decided to up the point requirements by 1000 – 2000 towards earning a free night for a room. With that company, $1 = 1 point. So it was a shocker to many customers.
    I enjoy Starbucks, but out of principle I might be only going if I have a craving.

  42. Hi all! I am a partner with Starbucks and would like to give info on this since launch day was yesterday
    Instead of 1 star per transaction, it is now 2 stars per dollar.
    It is now 300 stars to gold status as opposed to 30.
    You will now need 125 stars to get a reward rather than the 12 it used to be.
    We still have double star days, still have birthday rewards, you can still get free refills on your hot and iced coffees and teas.
    And! Stars will now be kept down to the decimal! For example:
    Say you spend 4.25 on a mocha before tax, you not only get the 8 stars for the four dollars, but you get half a star for the .25 cents you spent as well!! So normally you would get one star per beverage, now you will get 8.5! It is about 15 drinks to a reward rather than 12.. But we still have benefits and ways we can make it right for you. (:

  43. Does anyone else take advantage of Starbucks’ free refill policy?

    http://starbucksmelody.com/2014/12/23/the-starbucks-refill-policy/

    Maybe this is just DC, but several stores seem to have a pretty liberal refill policy. By that I mean every day I take my cup from the day before, go to the counter, ask for a pike’s place refill, show them day-old cup, present my app showing green/gold card status, then receive free cup of coffee.

    Now this only works for brewed coffee, and I think iced coffee/tea. Definitely not for any espresso drinks. But, I save at least $2-3/day.

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