Here's How The Anger Over Starbucks New Reward Program Could Have Been Avoided

Here's How The Anger Over Starbucks New Reward Program Could Have Been Avoided

Business February 24, 2016 / By Justin Brady
Here's How The Anger Over Starbucks New Reward Program Could Have Been Avoided

Anger over the Starbucks rewards program isn't about lower value, it's about broken trust.

The sheer fury over the new Starbucks rewards program is picking up speed faster than a train in an action movie fight sequence. At first glance it looks like the price spent to get a free item is to blame, but the real reason for the overwhelming negative public reaction is quite simple and could have been avoided. 

Back in September I attended the Re:Make conference in San Francisco, but due to other business while in the area I stayed in San Mateo. Obviously, that commute would have been treacherous, so I opted to leave for the conference at 4:30AM to completely avoid traffic. After being dropped off by my Uber driver however, I realized my strategy worked so well I had arrived too early and nothing appeared open. After a quick Siri search scrolling past the closed stores I found a Starbucks only a few blocks away, open, well lit, and with friendly staff that welcomed me with a warm smile. It was a reminder of why I like the company despite it being a huge chain.

I’m not alone. Americans love their coffee and they love Starbucks. Starbucks never stops innovating the coffee experience. They are constantly rolling out new coffee options, reserve selections and have upped the ante with their new Clover system in select stores. They are also constantly innovating their mobile app and rewards program, but this time they hit a snag.

Some customers correctly point out for those who simply buy a cup of coffee, the price paid out to receive a free item has gone from just over $24 to over $60. They also point out that maintaining gold status requires more money spent, which is also accurate. But surprisigny, these aren’t the reasons customers are outraged. Keep in mind, when it comes down to it, it’s still a great deal to get something free for nothing.

The extremely strong public reaction being witnessed is evidence that Starbucks lovers are passionate about their relationship with the company. After all, no one reacts this strongly to a company they don’t like or don’t visit — they just ignore it. But why the negative reaction? It’s simple. Starbucks didn’t honor the relationship, opting instead to deceive their loyal customer base. 

That may seem strong, but while the details of the rewards program are clear, the intent behind Starbucks actions is what customers have a problem with. The company deliberately tried to position a loyalty program downgrade as as a positive, even telling their loyal customers the action reflects the number one request they heard from members. And customers are calling them on it.

It would have been one thing to downgrade the program and be open with customers. Customers are used to loyalty program changes or rising costs and the coffee behemoth could have said cited “rising costs” or other positive messages. Yes, people would have still been upset and disappointed, but there wouldn’t have been outrage.

Netflix, for those who remember, ran into a similar snag. What was a simple price increase ending up nearly killing the company, when they tried to spin a downgrade in service as “now members have a choice.” 

Your customers are donig business with you because they trust you, but be warned, they aren’t dummies. If you try to slip something past them, or if they even suspect you are trying to, their reaction will go beyond dissapointment, turning into anarchy. Instead, they will feel as if you are breaking their trust, and there is no worse breakup than when someone feels they have been lied to. Starbucks could have prevented anger by addressing the downsides instead of brushing them under the rug, telling customers they would love the change.

You cannot innovate without being empathetic to your customers needs and you cannot create incredible experiences without being honest and open.The next time you need to communicate bad news, as hard as it may be, don’t try to spin news into something it isn't, remain positive and be forthright. The negative customers that leave weren't healthy for your business to begin with. The rest of your customers will respect you and the relationship will only grow stronger. 

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Article Featured Image: Wikimedia Commons @ QFront-Shibuya

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