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Starbucks and Bank of America Partner to Enhance Loyalty Rewards

By Elisa Tavilla
February 20, 2024
in Analysts Coverage, Credit
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Some Starbucks Cafes Overwhelmed By Mobile Order and Pay Volume, Starbucks mobile payments

Some Starbucks Cafes Overwhelmed By Mobile Order and Pay Volume

Starbucks and Bank of America announced a new partnership that enables customers to earn more loyalty rewards by linking accounts. Bank of America cardholders and U.S. Starbucks Rewards members can earn 2% cash back on top of the rewards or card benefits they already earn on qualifying purchases, and 1 Star per $2 spent at Starbucks when they link an eligible debit or credit card with their Starbucks Rewards account.

Qualifying purchases include reloading a digital Starbucks gift card, ordering ahead, or paying in the app at the register. Stars earned can be redeemed toward rewards at Starbucks, including free drinks, food, and merchandise. The new program is open to currently enrolled Starbucks Rewards members and Bank of America cardholders, as well as new members or cardholders.

“We are pleased to partner with Bank of America and offer Starbucks Rewards members even more valuable benefits like cash back and more Stars,” said Ryan Butz, VP, Loyalty Strategy and Marketing at Starbucks in a prepared statement. “This partnership is the latest example of how we are continuing to invest in our most loyal customers to deepen engagement and connection by offering benefits and experiences that can’t be found anywhere else.”

Loyalty Rewards Collaborations

Starbucks has been collaborating with different partners, including airlines and big box retailers, to innovatively enhance engagement, experiences, and loyalty benefits for their mutual customers. Delta Airlines and Starbucks launched a collaboration that allows U.S. customers enrolled in both the Delta SkyMiles and Starbucks Rewards loyalty programs to link their accounts and enjoy richer rewards opportunities last October.

Target rolled out its Drive Up with Starbucks service nationwide in August 2023. Target customers can add their favorite Starbucks menu item to an order and have it delivered to their car at stores offering the retailer’s free Drive Up service.

Starbucks continues to see a steady increase in customers using its mobile app to buy coffee and other items. The Seattle company said 31% of total transactions at U.S. company-operated stores were made via the app as of December 2023, a record and up from 27% in the year-ago quarter and 25% from two years earlier. Starbucks debuted its mobile order-ahead feature a decade ago. The company is now among the leading U.S. mobile payment providers.

Starbucks also continues to grow its loyalty program, with 34.3 million active U.S. members, up from 30.4 million a year ago. Starbucks Rewards members accounted for nearly 60% of sales at company-operated U.S. stores in the most recent quarter.

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Tags: Bank of AmericaDeltaLoyaltyRewardsStarbucksTarget

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