Published on: April 21, 2011
by Kevin Coupe
Content Guy’s Note: Below is a commentary on the same subject as the video piece, but it isn’t word-for-word the same. You can look at both, or either...it is up to you. I look forward to hearing from you.
Hi. I’m Kevin Coupe, and this is what is on my mind this morning....
There was a story the other day, first reported in the Chicago Sun Times, I think, about how Starbucks CEO Howard Schultz said that “Starbucks has no technology,” and that the company’s competitive advantage is “humanity.”
And then, after he brought the tablets down from Mount Sinai... Just kidding.
He also said, apparently, that the internet “is not a channel to sell things, but one to build trust.”
Let me work backwards on some of this hogwash.
First of all, if he really thinks that the internet is not a channel to sell things, he ought to pay a little more attention to what’s going on in Seattle. There’s a little company there called Amazon that might disagree with him.
In addition, I would point out that Starbucks sells stuff over the internet. In fact, I have a subscription to Starbucks coffee that has two bags showing up at my office door once a month. I’m not sure I am saving any money on this deal, but I am assured that while I am on the road, I’ll never get a text message or phone call from Mrs. Content Guy wondering if we’re out of coffee. And Starbucks is assured, by the way, that I won’t be choosing another brand of coffee, at least not anytime soon.
(This is, by the way, the essence of the Amazon Subscribe-and-Save model. Which sells stuff. On the internet.)
I would also disagree with the assertion that Starbucks does not have technology. It uses plenty of technology, though in some cases, I’d argue, not particularly well.
An example of the company’s missteps, I would argue, is its frequent shopper program. Buy 15 coffees using your Starbucks card and you get a free one. Very nice. Except that the free one comes in the form of a post card delivered via snail mail, which you then have to carry with you to get the free coffee.
This makes no sense. They’ve got the card. They’ve got the data. It would be much simpler - and easier for the consumer - to just adjust the system so that every 16th cup of coffee I order at a Starbucks is free. If I want to find out how close I am, I just have to go online to see. (Which I can, by the way. So the technology is in place.)
Unless, of course, the whole idea is to offer a freebie that will largely go unredeemed. That couldn’t be the idea, could it?
At the same time, for people who use cards to buy their coffee, Starbucks ought to offer the option of having receipts emailed to the consumer. The company makes such a big deal about sustainability, this should be a no brainer.
All this kind of stuff is technology-driven, but it also is consumer driven. It makes our lives easier and more rewarding. And it serves as a shopper-friendly response to the study we ran here on MNB just yesterday saying that Americans are leaving one-third of all loyalty rewards on the table, unredeemed.
C’mon Starbucks. You can rebuild this. You can be better than you’ve been. Better. Stronger. Faster.
Because like it or not, you have the technology...
One other thing. I may be talking specifically about Starbucks here, but I could also be talking about any number of other retailers in a variety of venues that have loyalty programs that seem specifically designed to drive down reward redemption, or just plain annoy us.
That’s what is on my mind this Thursday morning. As always, I’d like to hear what is on your mind...
- KC's View: