Starbucks is enhancing its long-standing loyalty program in new ways with a slew of partnerships with the services its customers use day-to-day; Lyft is just the latest company to hop on board.
With a new multi-year deal between the two companies, Lyft drivers and riders will have the opportunity to reap the benefits of Starbuck’s loyalty ecosystem, better known as the My Starbucks Rewards (MSR) program.
In a company release this week, Starbucks announced a collaboration with ride-sharing network Lyft to boost value for current customers, attract new customers, provide more rewards for Lyft drivers and possibly bring transportation benefits to Starbucks employees.
“With Lyft’s presence in 65 cities across the U.S., where we also have Starbucks serving the same communities, we knew this relationship would benefit our partners, Lyft’s drivers as well as our mutual customers who are already coming to Starbucks and using Lyft services,” Adam Brotman, chief digital officer at Starbucks, said in the statement. “This is a great win-win. Our digital loyalty ecosystem will strengthen Lyft’s ability to attract and retain customers in a highly profitable way, while at the same time accelerating the incrementally of redemption of rewards.”
The new deal will allow Lyft drivers to automatically achieve gold status as MSR members, which for normal customers requires earning a predetermined number of loyalty stars each year to maintain. Both Lyft drivers and riders can now earn additional rewards redeemable for food and beverages at participating Starbucks stores.
Another unique addition the deal brings is the ability for Lyft riders to send Starbucks eGifts to their Lyft drivers directly through the app, allowing a new and more personal way to show appreciation.
Starbucks is on a roll with enhancing its MSR offering, recently announcing deals with both The New York Times and Spotify. As Starbucks continues the growth of its loyalty platform, customers are provided with the ability to integrate earning rewards with their everyday experiences with other companies, such as reading digital news, streaming music or catching a ride.
“There are two things most of us do every morning: get a cup of coffee and commute to work. Together with Starbucks, we can make both a friendlier, more enjoyable experience,” John Zimmer, co-founder and president of Lyft, added. “Lyft and Starbucks share a lot of the same customers and importantly we share a commitment to doing right by our customers and our people. In the days, months and years ahead, we will launch exciting programs for loyal community members, and new products that will change the way we move around our cities.”
Loyalty and rewards has become a sweet spot for retailers looking to up customer engagement and capture consumer attention while still driving sales.
But as MPD CEO Karen Webster explained recently, it’s easy to believe loyalty innovations are setting the world on fire. In actuality, active participation in those loyalty programs has been on the decline since 2010.
At that time, 54 percent of loyalty program members were inactive. Five years later, in 2015, nearly 60 percent (58 percent to be precise) of program members are inactive – despite the fact that the number of memberships is on the rise at 29 per household.
While Starbucks is considered a leader of the pack when it comes to loyalty programs, due to the success it has seen as one of the pioneers of mobile loyalty solutions, the company is also focused on expanding its latest mobile offering.
Last month Starbucks announced the expansion of its Mobile Order & Pay pilot program, which was originally only available within its test markets within Portland to Seattle and across the Pacific Northwest. The mobile ordering service now reaches 3,400 more U.S. stores across 21 more states in the southern and central U.S. The program appears to be running smoothly as Starbucks remains on course to eventually rollout the service across the country.
“Store managers say it helps partners provide customers one more way to connect with Starbucks, and the easy-to-use feature has proven convenient for customers eager to save time throughout their day,” the company wrote in a blog post at the time.