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Starbucks continues driving partnerships with Lyft loyalty integration

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July 24, 2015

Lyft and Starbucks could be an unstoppable duo

Lyft and Starbucks could be an unstoppable duo

Starbucks is continuing its streak of teaming up with major brands by tapping ride-sharing application Lyft to offer its employees My Starbucks Rewards gold status, and enable riders to tip their drivers with the chain’s egifts.

Starbucks’ dedication to integrating multiple companies’ products and services into its loyalty app suggests that the brand is ready to crest another wave of mcommerce success. However, its leading status in the food and beverage sector may also suggest that marketers who do not offer more than branded content in their loyalty apps will face a severe disadvantage with customers.

“Uber and Lyft represent the physically mobile consumer,” said Gary Schwartz, president and CEO of Impact Mobile, New York. “Both transportation companies are aggressively looking for growth opportunities.

“Starbucks is one of the largest mobile loyalty networks globally: there are not many partners in the market with such a loyal mobile consumer base.”

Starbucks and Lyft did not respond by press deadline.

Increasing value to consumers
The multi-year deal aims to attract new consumers, increase value for current rewards members and explore a transportation perk for Starbucks employees. Lyft drivers now have the option of becoming gold status members of the My Starbucks Rewards program, while its riders and drivers can also snag Starbucks loyalty stars for using the app.

The stars are redeemable for free food and beverage items at Starbucks locations nationwide.

Starbucks is ramping up to become one of the most cohesive digital loyalty ecosystems in the retail sector, and hopes to reward its employees, customers and Lyft drivers in one move.

“Brands are looking to go outside the box to form partnerships with other brands that also reach their core demographic,” said Andrew Budkofsky, executive vice president of partnerships at Digital Trends, New York. “While traditional advertising still works, partnering to reach consumers through non-traditional venues like digital is proving to be more effective for many brands.”

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Lyft has previously delivered Starbucks’ bottled iced coffee to city-dwellers

The fan-favorite coffeehouse brand also realizes that reliable transportation to and from work can be difficult for some employees, particularly in urban areas where they are forced to rely on public transportation. Therefore, Starbucks is tapping Lyft to explore a program that would bring convenient and cost-effective ridesharing possibilities to its partners.

This will be tested in one undisclosed market later this year.

Lyft, a competitor to fellow ridesharing app Uber, currently maintains a presence in 65 cities across the United States. Its partnership with Starbucks may prompt the company to expand that reach and also target new customers in its existing locations.

An interesting feature of this collaboration allows Lyft drivers to receive Starbucks eGifts within the Lyft app from appreciative customers. This is a unique way of riders being able to thank their drivers with a tip other than cash, and could set a new standard of gift-giving within ridesharing apps.

“I could see this happening in the future,” said Chris Cunningham, head of global brand partnerships at ironSource, New York. “People want to give a good driver something and there is a monetary value in Starbucks eGift cards.

“This partnership is an example of a wider trend where partnerships between big brands are increasingly going to transform the consumer experience.”

This is not the first time Starbucks has teamed up with Lyft. In June, the beverage brand enabled Lyft users to place orders in select cities for Starbucks’ bottled iced coffee drinks, which were then delivered to their locations.

Grabbing partnerships
This week, Starbucks announced it is expanding its partnership with The New York Times to bring top daily articles to its mobile app users and reward loyalty members with points when they purchase print and digital subscriptions, reflecting the growing importance of top-notch content for merchants on mobile (see story).

The coffee marketer is also tapping music streaming service Spotify to enable loyalty members to receive stars for Starbucks and non-Starbucks purchases.

Starbucks
Starbucks chooses partnerships that offer relevance to the brand

Lyft will likely reap significant benefits from its newfound partnership, however, and may prompt other similar apps to attempt to forge relationships with popular quick service restaurant chains.

“The loyalty industry is changing in the way that consumers don’t want to earn loyalty points and spend their rewards in just one place,” said Christopher Barnard, president of Points, Toronto. “They want their loyalty currency to be universal, flexibly earned and spent across multiple programs.

“By allowing customers to earn Starbucks loyalty stars through Lyft rides, Starbucks stars become even more valuable, giving customers more incentive to return to their cafe. Similarly, by allowing customers to tip Lyft drivers in Starbucks eGift cards, Starbucks is transforming their digital loyalty into a form of valuable, transactional currency.”

Final Take
Alex Samuely is an editorial assistant on Mobile Commerce Daily, New York

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Alex Samuely is staff writer on Mobile Commerce Daily, New York. Reach her at alex@mobilemarketer.com.

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