Starbucks’ new loyalty program is hurting public sentiment on the coffee chain.
The company’s score was 29 on Wednesday, compared to 60 a little more than a week ago. Scores are gathered from people who have made Starbucks purchases in the last 30 days and range from -100 to 100, so the chain is still in the positive zone — but far lower than its previous score.
Before the announcement, Starbucks’ scores were near their highest levels in the recent past.
There was immediate outrage on social media after Starbucks announced it was moving away from the current My Starbucks Rewards program that allows customers to earn one “star” per visit.
“This new program won’t work as well,” reads the top-rated comment on the Business Insider article reporting the change. “Making people wait till they spend $50 for a few drink is way too much.”
However, analysts had a different opinion.
“Yesterday morning, Starbucks announced an update to its rewards program that Nomura views positively, as it provides a greater incentive for customers to spend more money,” Nomura analyst Mark Kalinowski wrote in a research note.
Kalinowski argued that the revamped program is fairer than the alternative. Additionally, the update will provide greater incentive for customers to order and pay using Starbucks’ app, and cut the hassle of ringing up multiple purchases for the approximately 1% of customers who split transactions to earn multiple stars when buying more than one item.
The revamped rewards program contributed to Starbucks announcing a same-store sales target of high-single digits growth in the coming fiscal year.
In January, Starbucks reported that the My Starbucks Rewards program had 11.1 million active members in the US, an increase of 23% from a year ago. The popularity of the rewards program has helped boost the chain’s mobile sales, which now account for about 6 million orders a month.
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