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Starbucks Is Upgrading Its Loyalty Program

By Jennifer Saibil – Updated Jul 21, 2020 at 11:16AM

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The coffee chain will add new payment options for rewards members.

Starbucks (SBUX -0.63%) is leveraging its extensive data systems to offer a more compelling rewards program for loyalty members. Starting in the fall, the company announced on Tuesday, members will have more ways to pay and earn stars toward free beverages.

Currently, the only way for Starbucks rewards members to earn stars is when they pre-fill a Starbucks card and use it to pay. 

Starting this fall, the coffee giant will offer members in the U.S. and Canada the option to pay with credit or debit cards or certain mobile wallets. Customers will be able to keep those payment methods in the Starbucks app and scan it to pay, using their choice of payment method, or they'll be able to link the payment methods to their account and still gain points.

Ordering and picking up from a Starbucks location.

Image source: Starbucks.

Members earn two stars for every dollar spent with a pre-paid Starbucks card or gift card, and will earn one star for every dollar spent using other methods under the new system. (A minimum of 25 stars earns an "upgrade" to a drink order.)

"Our customers have shared with us that they would like more options to pay and earn Stars in the app as a Starbucks Rewards member, in addition to the Starbucks Card," chief marketing officer Brady Brewer said. "We expect the expansion of payment options will appeal to an even wider customer audience and deepen engagement with our members."

The Starbucks app is one of the most-used apps in the U.S., ranking for a time as No. 1 before being overtaken by Apple, according to eMarketer. The app offers multiple order and payment methods including mobile order and pay, and contactless payment.

Jennifer Saibil has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Starbucks. The Motley Fool has a disclosure policy.

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