Despite the trendy shift to locally-sourced products and independent establishments, coffee giant Starbucks is still wildly successful. Price increases, business model changes and negative media have yet to slow down their rapid growth. But Starbucks’ most recent change could end that impressive streak.
Previously, their rewards program awarded loyalty or how often customers purchase Starbucks products. As of mid April, they are rewarding customers for how much they spend each visit. Customers are feeling ripped off by the change and took to social media immediately after the announcement to express their disapproval.
Starbucks was certainly aware of the enormous amount of traditional and social media attention the new rewards program was getting, so why did they choose to stay quiet? Starbucks’ only response to the early complaints in February were on their blog. They didn’t address customers’ frustrations but said only that they must be confused.
Companies have better access to their customers than ever before and it has the potential to be incredibly beneficial. They can immediately share news and promotions, collect customer feedback and establish their brand through social media. Starbucks generally does this well, but missed an opportunity to connect with their customers by failing to acknowledge their disapproval of the new rewards program.
The Starbucks brand has created a strong customer base, but if customers no longer feel respected and heard, that could change. Do you think Starbucks made a mistake by not adjusting their rewards program after people loudly proclaimed their disapproval? How might Starbucks have handled this situation differently?