Customer Loyalty at Starbucks

 It costs a company five times more to gain new customers rather than retaining the current one. The same research also stated that a business's existing customers are 50% more likely to try a company's newly launched product/services than attract new customers who are only 31% more likely to try such new product/services offered. 


So what exactly is Customer Loyalty? Customer Loyalty is the likelihood that an existing or a previous customer continues to do business/buy products or services from the same company. For this, the business has to offer customer loyalty programs to its customers to assure that those set of customers come back to your business and help you maximize your profits. Customer Loyalty offers more growth to the business with let alone the Marketing and Sales department.


Let us now take an example to understand Customer Loyalty more accurately. In this blog, I have chosen Starbucks as an example. Who doesn't love Starbucks? We all do! Starbucks entered into the Indian market where "Tea" was a predominant drink. But still, it managed to give a close competition in Indian Market. Starbucks is always known for its loyalty program. One such highly talked about and currently successful loyalty program is "My Starbucks Reward." It has crossed over half a million-member mark! Customers can avail of this card at any Starbucks outlet with a minimum of Rs.200 and keep on getting various discounts, Birthday drinks, and so on. 

Comments

Post a Comment

Popular posts from this blog

Customer Lifetime Value of Starbucks

Image
  Customer Lifetime Value (CLV) represents the importance of the customer to a business over a span of time. With this formula, you can measure a basic Consumer Lifetime Value model for your company: AVERAGE ANNUAL CUSTOMER PROFIT ✕ AVERAGE DURATION OF CUSTOMER RETENTION The higher the value, the higher the marketing expenditure each client will have. This is a crucial principle to be grasped in the industry and for individuals looking to spend capital in consumer-oriented businesses. CLV tells how much you need to invest in consumer acquisition Your consumer acquisition expenses may well be higher than the first transaction, but are you making money off the customer in the long run? Identifying the customer's lifetime value to your business will give you the answer. Let us take Starbucks as an example. Let us first see how Starbucks creates value to its customers- Payment made easy through their Mobile Apps My Starbucks Reward- to avail various benefits, discounts, birthday drinks...
Read more

Customer Churn at Starbucks

Image
  Customer churn is one of the most critical indicators to measure a rising business. Although this isn't the happiest metric, it's a statistic that will tell the business the hard truth about its retention with consumers.Customer turnover is the number of consumers who have discontinued buying the product or service of the business after a certain amount of time. You will measure the churn rate by measuring the amount of customers you lost over that time period—say, a quarter—by the number of customers you had at the beginning of the time period. So how does Starbucks creates customer retention?  Customers are searching for a customized, created-only-for-them experience whether they're ordering a taxi off the app or online shopping for underwear. Starbucks knows just who their clients are and what kind of cozy atmosphere they're looking for. Starbucks is dedicated to communicating with their clients through their products and display. Each shop has a friendly and welco...
Read more