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Starbucks Copies Airlines, Devalues Loyalty Program

SmarterTravel

American’s AAdvantage program isn’t the only loyalty scheme converting to spend-based points accrual later this year. Starbucks, the world’s largest purveyor of coffee-based beverages, has announced plans to make a similar change to its Rewards program, effective some time in April.

According to the company:

It’s an exciting new program that reflects the #1 request we heard from members: more Stars awarded based on what you buy, no matter how often you visit.

The big news is that, in the new Starbucks Rewards, you’ll earn 2 Stars for every $1 you spend, which means more Stars for your favorites—from coffee and drinks to food, mugs and more.

Rewards members may earn more Stars, but for most of the caffeinated crowd, they’ll be worth less.

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Under the current scheme, program members earn one Star per visit, and attain Gold status after 30 visits. Having reached Gold status, members receive a free drink or food item after every 12 visits. (Sub-Gold members receive little beyond a free birthday drink.)

Under the new scheme, members will earn two Stars per $1 spent, but will need 300 Stars to reach Gold status. And a free drink or snack will require 125 Stars.

So, today a Gold member can earn a freebie after spending as little as $24, for 12 $2.00 cups of coffee. With the new spend-based system, the same freebie will require at least $62.50 in purchases.

Bottom line: If you spend less than $5.21 per visit, on average, the new Rewards scheme will be less rewarding than the current program. Starbucks doesn’t divulge the average per-visit spend of its customers, but it’s a safe bet that it’s less than $5.21 for the great majority of coffee drinkers. And the freebie calculation is moot unless you can qualify for Gold status, which will require $150 in purchases during a calendar year.

Members of airline and hotel rewards programs will no doubt find the Starbucks program devaluation all too familiar. But for many of Starbucks’ 11 million-plus U.S. Rewards members, the changes will be as unwelcome as they are unexpected.

Reader Reality Check

On average, how much do you spend during each Starbucks visit?

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After 20 years working in the travel industry, and 15 years writing about it, Tim Winship knows a thing or two about travel. Follow him on Twitter @twinship.

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