Starbucks, founded in 1971 has one of the best and innovative customer experience strategy in the world. In 2019 alone, Starbucks generated as much as $25.3 billion in sales, putting the company on number 35 of Forbes World’s Most Valuable Brands.
Lets take a look at how Starbucks have stayed ahead of competition well ahead of their time.
One of the main reason why Starbucks are able to provide good customer experience is because of the human element it takes into consideration together with its core business activities.
‘’To inspire and nurture the human spirit – one person, one cup, and one neighborhood at a time.’’Starbucks Official Mission Statement
The key lies on Starbucks willingness to drive a better customer experience in strengthening customer relationships through convenience and through rewarding loyal members. This enables them to analyze customers’ needs, behaviors, and attitudes which allows them to understand their customers better.
Starbucks First Mover Advantage
By looking at Starbucks history, it becomes apparent that the company stayed ahead of competition in terms of adopting to technology.
In 1998, the company was one of the first to launch its website around the dot-com bubble. 4 years later in 2002, Starbucks started providing free Wi-Fi services to customers in all of their stores. This changed customers perception of Starbucks from being a quick place to get a cup of coffee to a place where they can hangout and use free internet with a cup of coffee all day long.
In December 2018, Starbucks recorded 16 million active members through its loyalty rewards program. Furthermore, the company recorded 12% of its total sales from mobile ordering features. The numbers are impressive considering the fact that there is still large number of businesses who are yet to establish their loyalty program and are just starting to adapt to mobile payment terminals.
However, Starbucks are not resting on their laurels. Their next target market, is the millennials. The introduction of its Starbucks bonus star bingo game piqued the interest of the millennials and was a hit. Members with loyalty subscription could play games, earn points, and redeem free products from the store paving the way for an excellent customer experience.
The emergence of artificial intelligence in 2017 provided another opportunity for Starbucks to use technology as a frontier in improving customer experience. Their partnership with Amazon, enable customers to order beverages through a simple voice command using the Alexa platform.
Of course with the adoption of cutting edge technology comes cost which might be passed on to end consumers, resulting in negative experiences! But, here’s the catch, in the U.S. in particular, consumers do not mind paying a premium price of up to 18% for something like coffee, provided they had encountered a good customer experience.
The ability to secure customer’s loyalty and create personalized experience is key for Starbucks in maintaining an excellent customer experience hence why they make it a point to know their customers name and previous orders through available data to foster successful relationships.