Starbucks’s tactic to drive repeat sales

Perhaps have seen the latest Starbucks offer (it prints out on your receipt if you visit Starbucks in the morning). If you buy something before 2pm in-store, you can return after 2pm to buy any type of medium iced drink for $2.

This can be a fairly compelling offer, so I stopped to think about what they are getting from this deal and how customers benefit. Here is what I’ve come up with (if you have other comments, please add them below).

Customers get:

• To return and try any drink at a reasonable cost – including a more expensive drink that perhaps they haven’t tried before (let’s say a Caramel Frappacino, which is nearly $4 in LA).
• They can share the coupon with someone else – either way, Starbucks might get an extra sale in that day that perhaps they might not have gotten otherwise. (For example, I give the coupon to my husband – he’s the coffee drinker of the family.)
  

Starbucks gets:

• Repeat or additional sales in one day (from the same customer or someone they share the coupon with).
• They might be able to build an appetite for 2 drinks per day from 1 customer (let’s say a morning coffee and an afternoon iced drink). When Dunkin’ Donuts was a client of mine, they were always trying to come up with ways to get folks into their stores for afternoon drinks/snacks in addition to the morning coffee run – that is why they branched into cookies and more drinks, smoothies, etc.
• While offering customers the chance to sample a more expensive drink, they might “help” customers see how much they prefer the more expensive option or would like to have that higher-price drink more frequently.
  

Keep in mind, McDonalds is pushing very hard on the coffee drink space right now – I’ve seen many outdoor ads in LA, plus many online ads too. Often, those ads mention the price of a small coffee drink to drive first-time trials. So perhaps this offer is a way Starbucks is trying to keep some of their existing business and/or grow it a bit. (Note, I have seen this promotion through Starbucks before – maybe it was last summer – so it’s not new, but the timing is interesting given the big McCafe push.)

Comments? Other angles? Have you seen other offers that drive trial? Comment below.

Tool to measure use of social media

You may have read the book, "Groundswell". It's a good overview of the world of social media and open-customer dialogue we live in now. If you haven't read it, pick up a copy. It offers some good ideas and many helpful ways to think through social media.

Anyhow, I want to point out a helpful tool they have made available. The tool below helps you get a general sense of your audience and how they use social media in various ways. You pick the age and gender specifications and it will show you what types of social activities they engage with online. See the cool research widget below. To get started, click the "Build profile now" button.

How social media supports your business

Take a look at a few slides I put together that outline the various business activities that are supported by social media. The activities supported include: content monitoring, customer service, decision making, content creation & distribution and more.

Social media supports your business

View more documents from Customers That Click.

Praise where praise is due

A friend of mine sent along an email he got from FinancialTimes.com. He is a subscriber of FT.com and he was impressed enough to send this to me, and I’m impressed enough to share it with you.

This is an example of the way to communicate to customers when you care about developing long-term relationships. This email tells their customers that they matter.

I love this email so much I’m including it in its entirety below. Use this email as a model for your customer communications. Let your customers know when changes are coming and when and how they will be affected.


Dear FT.com user

Over the next week we will be undertaking some essential maintenance work on FT.com.

The work is part of our on-going efforts to improve the performance of the site and make it easier for you to find what you're looking for quickly and easily.
Naturally, we will do everything we can to minimize the impact on the site and we hope you won't notice a thing. However, on Saturday, 6 June you may find that access to some services is disrupted.

Rest assured that we are working hard to have the site functioning normally as soon as possible, but please feel free to call us with any questions or unexpected difficulties.

Email: help@ft.com

US & Canada: 1 800 628 8088
Asia: +852 2905 5555
UK, Europe & Rest of World: +44 (0) 20 7775 6248

Sincerely

FT Customer Service
www.ft.com

Financial Times, 1330 Avenue of the Americas, New York NY 10019

Social media case study/ growing conference attendance

Learn from this example of how to grow conference attendance by giving registered attendees extra value with social networking tools.

Read this case study of leveraging social media as a conference benefit/ value.

ps. This case study highlights the Ning social networking platform. The conference in this study was the Southern California Business Growth Conference put on by LAVA and the Harvard Business School Association of Orange County (CA).

Learn from these Internet Marketing Case Studies

Here are 3 case studies about successfully growing web traffic, the viral marketing effect, revenue and actionable customer feedback. Click on the case study links below to learn more.

Email newsletter increases web traffic & revenue

Growing internet traffic by enabling your content to be viral

Capturing usable customer feedback with online surveys

The ‘broken window’ problem

No doubt you’ve seen a building with broken windows. This is often due to neglect or vandalism and it is a clear message that "no one cares."

What signals does a company give off that sends the same message? Frankly, too many to list here, but last week a company reminded me of a few of those indicators of not caring.

EZ Lube is a chain of oil change shops here in LA (and possible elsewhere). Here is how I experienced their "we don’t care" message:

- A dirty outside waiting area (tables/chairs). Other customers commented on it.
- Very slow service. 45 minutes for a ‘quick oil change’ service isn’t meeting expectation.
- There were no communications about the delays in their service. (Neither when I arrived, nor after I inquired about the delay while they were working on my car – in a very slow and unfocused way).
- They didn’t vacuum my car (part of the paid-for service) and when I brought it up they didn’t really care.
- Lastly, an email I sent to the manager (his card was on the desk as I was paying so I figured I’d let him know about the problems I encountered) went completely unanswered. If you don’t plan on responding or talking with customers, there is no point to making business cards available.

Take stock of the signals you send your customers. Reminder: You can google your company name, search twitter for mentions of your company, or just talk to your customers. They are often happy to tell you what you can do better. And that is a gift – it’s better to get constructive feedback than never to hear it (and have it affect your business).

Awesome customer service

I just came across this awesome customer service chat transcript from Zappos. What I love is how helpful and fun the customer service rep is - they are willing to serve, help, offer a free upgrade and have fun. God bless 'em.

Read the customer service chat transcript here.

The value of treating customers like kings

"I get excited when I hear how companies reward existing customers rather than only courting new customers with perks, discounts or special treatment."

Read more from this blog here.

Communicating substance and value

"It’s a principal of customer retention and satisfaction to clearly communicate the substance and value of a product or service. Customers are more satisfied if they know what they will get."

Read these tips about communicating substance and value to your customers here: http://customerevangelism.blogspot.com/2009/03/substance-value.html