Answer to Question #266695 in Management for Fajer

Question

Starbucks Loyalty Case Study (5 marks) 

ILOS: A1, A2, A3 

Please read the case study in the following link and answer the following questions in short answers (max. 50 words each). 

https://zinrelo.com/loyalty-rewards-case-study-new-starbucks-rewards-program.html 

1- Briefly explain the idea of Starbucks' loyalty scheme and how it works. 

2- Can we consider the Starbuck app a digital marketing channel? Explain your answer. 

3- How does Starbucks use their app to build customer loyalty? 

4- Give an example of another real life company that you recommend should create a loyalty app like Starbucks'. Explain your choice and why such an app would be useful for them. 

5- At what stage of the customer journey does such an app target customers? Explain your answer

Answer 1

1. When you scan your member barcode in the app and pay with cash, credit/debit cards, or mobile wallets at participating stores, you'll earn 1 Star for every $1 spent. When you link a payment method and pay straight through the app, you can earn 1 Star for every $1 spent.
2. Within the app, Starbucks also sends messages with special deals. This app's success demonstrates how excellent in-app messaging may boost a business's overall revenue. In 2016, 54 percent of marketers claimed they used mobile applications for marketing, up from around 27 percent in 2014, representing a 98 percent increase year over year. April 4th, 2016
3. Users can earn redeemable stars for every dollar spent on the Starbucks app. Giving these awards an expiration date (6-12 months depending on membership level) both motivates customers to use them and stimulates more purchases so loyalists can keep their upper-tier status.
4. Apple Company should employ such loyalty app since it is serving mass customers
5. This occurs when consumers have enough faith in brands to believe that every product they sell is of high quality, as a result of constant high performance and the correct marketing approach.