It's a dark, cold night. We're gathered outside around the campfire. There's a noticeable uneasy feeling lurking in the air.
So with flashlight in hand, our scary story begins...
...Once upon a time there was a consumer that met a brand and became its devoted customer.
The brand also expressed it's love for the customer with a loyalty program and promise of valuable rewards.
But the brand failed to live up to its loyal customer's expectations.
And so, what was once a devout customer turned into a beastly creature that threatened the brand, eager to gain revenge.
So what became of the brand and customer that were once in love?
It’s one of the oldest stories in the book, and a good reminder for brands out there on what can happen when you don’t deliver on customer expectations. Your most loyal customers can go from brand advocates to brand detractors – something we refer to as the Dr. Jekyll/Mr. Hyde predicament. But don't fret too much, you still have the power to choose how your story ends.
The Chilling Tale of One Coffee Rewards Program
This story stood the test of time yet again when Starbucks recently made some major changes to its rewards program, catching some of its loyal customers off guard.
Its old program let customers earn 2 points (stars) for every dollar spent. Once their first point was earned, customers became green level members. Green level members received things like free in-store refills and birthday deals. After a customer accumulated 300 stars during a calendar year, they bumped up to gold status. Gold members received a free drink or pastry for 125 stars, were given opportunities to earn double stars monthly, and a personalized membership card.
With the new Starbucks loyalty program there’s no tier status, instead it’s set up to allow customers to start utilizing points sooner in smaller amounts. For example, earning just 25 stars gets you add-ons like flavored syrup, while 50 stars lands you a free coffee, hot tea or bakery item. But in order to receive the most popular items for free, like a handcrafted drink or hot breakfast sandwich, customers must earn 150 stars – 25 points higher than the previous program. And boy was Starbucks in hot water with its most die-hard members after they realized the value of their stars had decreased.
Some customers even went to bed with enough points for a free breakfast sandwich or two and woke up to those being taken away.
Really the majority of people taking the biggest hit with the new Starbucks rewards program are its most avid customers, as they are the ones that rack up enough points to become gold members, earning the fancy free drinks. It all comes together to create the perfect formula, turning Starbucks’ most loyal customers (Dr. Jekyll) into its harshest critics (Mr. Hyde).
This new Starbucks rewards iteration has been active for less than 6 months, so the jury’s still out. We’ll see what the future holds and the impact it makes on what were once Starbucks’ most loyal customers.