Starbucks To Offer Brand Visa Card
March 24 2016 - 3:02AM
Dow Jones News
(FROM THE WALL STREET JOURNAL 3/24/16)
By Julie Jargon
Starbucks Corp. said customers using a coming branded prepaid
Visa card would be able to earn points for free coffee and other
perks.
The coffee chain outlined its latest plans to expand its rewards
system beyond its own shops during its annual shareholders' meeting
on Wednesday in Seattle. The Starbucks prepaid card could be used
at any retailer that accepts Visa cards.
The Starbucks card, which could be available by the end of the
year, will allow holders to earn "stars" for all purchases made on
the card. Those stars can be redeemed at Starbucks cafes. Customers
will be able to apply for the card through the Starbucks mobile app
or on its website.
"This is just the beginning," Starbucks President and Chief
Operating Officer Kevin Johnson said at the meeting. "We intend to
open up our digital ecosystem to more payment options." He didn't
elaborate.
Restaurants and retailers in an increasingly competitive
environment are vying to establish repeat customers, and Starbucks
has made its loyalty program a central part of its growth strategy.
Even fast food chains are jumping on the bandwagon. McDonald's
Corp. recently said it plans to develop a loyalty program later
this year or early next.
The shareholder meeting got off to a rocky start after a bogus
news release from a labor group early Wednesday claimed the event
had been rescheduled on short notice. The prank, orchestrated by
Working Washington, a union-backed group that has pushed for
minimum wage increases in Washington state, was intended to
demonstrate the difficulty workers face with unpredictable work
hours.
The Seattle-based group, under the guise of "SBUX Shareholder,"
sent an email to reporters later in the day explaining that,
"shareholders and executives got to imagine what it might be like
if the Starbucks Corporation treated everyone's time like they do
baristas' time in many of their stores -- with on-demand,
ever-changing schedules."
A spokesman for Working Washington confirmed the group was
behind the Starbucks hoax.
The meeting ended on a high note with a performance by Alicia
Keys, in keeping with Starbucks' tradition of showcasing big-name
performers at its annual meetings.
Starbucks last month announced it is changing its loyalty
program to reward customers based on how much they spend rather
than how frequently they make purchases. Under the new system,
which takes effect in April, customers will earn two rewards
points, or "stars," for every dollar spent, rather than one star
for each transaction, a move that caused a bit of a social media
uproar among customers who place small orders.
"The intent behind it was to level the playing field for our
customers," Mr. Johnson said.
Since the announcement, more than 500,000 customers signed up
for the program.
Starbucks has been seeking other ways to attract customers. The
coffee chain has teamed up with music-streaming service Spotify and
ride-sharing service Lyft Inc. to allow those customers to get
reward points that can be redeemed at Starbucks.
During the annual meeting, Starbucks also announced plans to
introduce its Teavana brand of teas to its cafes across Asia,
Europe, the Middle East and Africa by the end of the fiscal year
ending in September. Starbucks acquired the tea retailer in
2012.
In the U.S., Starbucks this summer plans to roll out a new
ready-to-drink cold brew coffee in some supermarkets and Starbucks
cafes.
(END) Dow Jones Newswires
March 24, 2016 02:47 ET (06:47 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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