Need to learn from the Mermaid.

I get the Wall Street Journal everyday and have the opportunity to give it a quick read and saw something interesting in it yesterday talking about of Starbucks. It seems like they have had a lot of articles about the company since I first started getting it a few weeks ago, but that's besides the point. The article was talking about how the reloadable Starbucks card is now accounting for something in the nature of 25% of their sales in US stores.

What I find signifcant with this relevation is that it is creating a group of people that are really focused on those little cards. Basically the person with a Starbucks card and twenty bucks on it when out with the choice between the Mermaid and another shop is almost always going to pick the store they have money at. This really gives Starbucks the upper hand when it comes to competing.

Edit: Their link to embed their video isn't working right so here is a link instead.

It's rather ingenius really, people use the gift card and get some rewards like a free drink on their birthday or a free extra pump of syrup in their coffee. Also, I am sure people really want to get to that Gold Card status. I know I was well on my way to getting one not too long ago, it's rather addicting trying to get those stupid 30 stars.

My real point is that I think specialty coffee needs to do more to encourage repeat business. I think a site like Roaste is probably the best example of what I think small roasters can do. Obviously it's hard to compete with the mermaid just because of their size, I mean I can use a Starbucks card in SF or NY or Kansas City, it doesn't matter and I doubt there are any other shops that are in so many places. But banding together makes it easier to compete.

It would be interesting to see if there could be something more akin to a disloyalty card that has been introduced in a few cities to encourage people to go to various shops. Maybe even something that if you could get a few different coffee shops to agree to do in a big city like a New York or Portland where they could have a gift card that worked at any of the stores and perhaps even had some of the same rewards. Obviously its hard to have competing business work together, but it does seem like its more of a community than other industries.

Please do note some of the benefits of buying from small roasters here; $19.00 for six months unlimited shipping, 2 dollar credit for reviewing purchases, 2% back on all purchases, and 10% off coffee subscriptions that can be canceled at anytime.