By Kim Bhasin
Starbucks is watching you, coffee drinkers.
Joe LaCugna, director of analytics and business intelligence at Starbucks, spoke at the Big Data Retail Forum in Chicago last week and explained how the coffee chain uses loyalty card data to track customers.
“We know who you are. We know how you’re different from others,” he said during the session, according to Kate Kaye at AdAge.
A quarter of all transactions at Starbucks are made with loyalty cards. That’s a lot of data being collected, and Starbucks still isn’t entirely sure what to do with all of it.
Right now, Starbucks segments its customers with the data, then sets up rules based on their purchase behaviour. Then, the customers get offers, usually on their smartphones.
These deals are targeted at customers whose purchasing habits show that they may not be coming back soon. Loyalists who constantly go to Starbucks don’t get the deals, since the coffee-seller isn’t worried about losing them.
There’s a total of 6 million registered loyalty program members and Starbucks has profiled half of them so far. Currently, about 80,000 new members join each week, according to Starbucks chief digital officer Adam Brotman.
Starbucks is now expanding its loyalty program to grocery stores and its Teavana chain of stores, but there’s no word yet on recently-acquired bakery chain La Boulange, noted Lisa Jennings at Nation’s Restaurant News.
Execs expect to have 9 million registered members by the end of FY 2013.
“The appeal in expanding the program is clear: Starbucks will have even more data about consumers’ buying habits,” wrote Susan Berfield at Bloomberg Businessweek. “The question remains whether the multistep process will test customers’ patience as much as it rewards their loyalty.”