Starbucks wants you to have your cake and eat it too.
The Seattle coffee giant will tweak its rewards program to entice customers to spend more during each visit, especially on the sweet and savory goodies behind its glass case.
In April, customers will earn Starbucks reward stars for the amount of money they spend at a store, as opposed to the number of times they visit a store, the company said on Monday. Under the current system, 12 visits equals a free drink. The tweaked one requires a minimum spend of $62.50 to earn a free cup of joe.
“Food has been a big part of their growth ambitions and the goal is to get people to order more food,” said R.J. Hottovy, a Morningstar analyst.
About 20 percent of Starbucks’ sales are derived from food today, but the company has said it is aiming to raise that to 25 percent by 2019 through gaining more lunch and dinner customers.
It’s a move that founder and Chief Executive Howard Schultz might not have imagined in 2007 when he sent a memo to his senior management — that was leaked — taking the blame for the “watering down of the Starbucks experience” and the need to get “back to the core” of what Starbucks does best: “We source and buy the highest quality coffee,” he said at the time.
Management expects the revamped rewards program, with 11 million members, to increase same-store sales this year. The average transaction at Starbucks is $5 plus.
Starbucks stock closed at $58.87 Monday, up 2.1 percent.