Starbucks card brings sales reward caught my eye first because I have a tremendous coffee addiction and read almost any article I find regarding coffee shops. Second, there is an amazing statistic inside of the article:
Most major retailers have been offering gift and loyalty cards for years, but industry observers say few have seen so many of their customers hang on to them as long, use them as often and reload them as regularly as they do at Starbucks.
Almost one in eight customers pays with a Starbucks card these days, Stark noted. About 96 million Starbucks cards have been activated in the United States and Canada since November 2001, and customers have reloaded their cards about 38.6 million times, bringing in $2.17 billion in revenue.
1 in 8 customers use a loyalty card at Starbucks. Now that is customer loyalty. The stat would not be as notable except that the company has brought in over $2 BILLION in sales in the past 5 years through this payment option. $4 lattes certainly help reach that statistic, but the program is an obvious success.
When we define a sale in our hiring process, one of the key pieces of information we collect is expected customer retention rate. Obviously, most companies target 100% retention, but that is rarely the case. Understanding the retention rate is only the first step in understanding the company’s customer focus.
The second step is to understand if the salesperson is responsible for the daily/monthly/yearly interactions with the customer to maintain the account. No salesperson can walk away from any customer they close, but their level of interaction with the account clarifies the amount of time they can spend chasing new prospects vs. servicing existing customers. If the customer is handed over to an inside team, their abilities to maintain and expand a customer account must also be considered.
Customer retention is a multifaceted, complex aspect of any business. Starbucks employs a wildly successful program to retain their valued customers in a highly competitive market. What programs, teams or strategies does your company employ in not only keeping, but expanding your existing customer revenue stream?