Customer Loyalty Programs: Bing and Starbucks

This year two companies revitalized their rewards programs. The rebranding is probably working out great for their advertisers, but it really isn't working out for me. I mean heck, I really didn't expect to do more work to get something for free. Although, for now, the perks of using these apps are still a nice to have. The two in this blog post are Microsoft's Bing search app and Starbucks Rewards app.

Microsoft's Bing app refresh is a hard sell and it looks like they are still trying to pay users to use their search engine and search app. Except, instead of the 2 minutes per day you spend searching random garble-gook for web and mobile and earning a $5 reward of some sort (e.g., $5 Amazon gift card, $5 Starbucks gift card, $5 Microsoft Store credit, etc.) which used to take 19 days at the Gold level (150 searches per month, 475 pts per $5 reward) it now takes 21 days of searching (at 250 points per day using mobile and web and a $5 Amazon gift reward which now costs 5,250 points) to accrue this benefit. I'm so glad I redeemed $15 worth of Bing search credits before the upgrade. The users who didn't spend their points before the upgrade probably feel screwed now; even though web search is a daily activity for most Netizens. Bing is very advertiser friendly, in fact, when you do a basic search on let's say.. dim sum, you don't actually get recipes or food photos of dim sum, you get local restaurants. At least no programming references come up anymore (dim being a macro reference and sum being a mathematical reference) on this search phrase.

The Bing interface is very pushy, to be polite, about all of its advertising. It pushes use of its Edge browser (the Internet Explorer "replacement") but uses a circa 1990s method of active browsing to grant monthly reward points. Remember way back whenever? It's the same model. Anyhow. I think this is the third or fourth time Bing has changed the requirements to its search app. If you love ads, you're going to love Bing Rewards.. which is now Microsoft Rewards but branded as Microsoft through the Bing app. You can get more Bing Rewards points by setting Edge as your default desktop browser AND having an active (heavily advertised) window open. But it's like big brother watching your every move and it is creepy. I don't use Microsoft Edge. Why would I use Microsoft Edge when I can access Bing through Google Chrome? Hmm, well, that doesn't make any sense to me either.

Moving onto the Starbucks Rewards app refresh. The threshold for a free drink by points was lower in the previous version of this app. And, all points and subsequently food/drink items were worth more or less the same; when in fact, they might actually have different Cost-to-Profit ratios. You could, for example, have earned points by purchasing the cheapest items on the menu (a tall hot chocolate or a tall cup of hot tea) and then redeem your reward drink (or food item) with the priciest item on the menu (a hot panini sandwich, a grande pumpkin spice latte, etc.). This is probably why the rewards-by-points structure changed. This is also probably why Subway got rid of its paper rewards cards and went with a debit card-styled rewards program instead.

Let me just say that I like Starbucks, their culture, how they treat their employees, and their campaign marketing style. How Starbucks (and all the project teams that made it happen) transitioned its mobile app users from the old reward system to the new one is a model of how other reward app purveyors should consider. The reward threshold definitely changed. You can't get away with the crazy stunts that the old system allowed. And, the points that you accrue actually reflect what you are purchasing. And, for Gold members the extra perks such as double star days and being able to get a free drink/food item at every 125 stars are truly perks that Green members do not have. Ultimately, the goal of this app refresh is to encourage customers to visit their local Starbucks store more frequently and/or to spend more per visit.

Allowing consumers a much lower requirement to get or extend Gold status for a year was a great conversion point this year. But, how long will that last when that special status expires next year? What constitutes "too much effort" on the part of the consumer to not bother with a rewards program? Can you really encourage consumptive spending with more advertising? I wonder.

Despite all the ad-heavy advertising on Bing search, it still pays out real digital rewards in the form of gift cards with monetary value that can be redeemed at establishments such as Starbucks or Amazon. Users are spending more of their time (an increase of 4 minutes per $5 reward cycle) to attain the same level of benefit. 4 minutes is not that big of a deal, considering that Netflix saves children from watching 150 hours of commercial ads per year and those of us who commute in a metropolitan area spend 52 hours per year in traffic.

Time value of Time? Haha, it's all in the eye of the user.
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