Starbucks Customer Retention

OVERVIEW

As part of my Retention Marketing course at George Brown College, I developed a strategic customer retention plan for Starbucks, focusing on market analysis, segmentation, and loyalty program enhancement to strengthen customer engagement and lifetime value.

CHALLENGE

Starbucks is a globally recognized brand with a strong loyalty ecosystem. However, as customer expectations evolve, Starbucks faces challenges in retaining diverse consumer segments, increasing long-term engagement, and optimizing loyalty program effectiveness.

APPROACH

Using a data-driven and CX-focused approach, I structured my analysis around four key areas:

Market Analysis – Assessed Starbucks’ position in the Canadian coffee market, consumer behavior trends, and competitor benchmarks.

STP Framework (Segmentation, Targeting, Positioning) – Identified a new customer segment Starbucks could better serve through tailored marketing and retention efforts.

Loyalty Program Strategy Design – Proposed enhancements to Starbucks Rewards to increase engagement, repeat visits, and purchase frequency.

Monitoring & Evaluation – Developed a framework to track customer retention using KPIs, engagement metrics, and loyalty-driven purchase behavior.

FINDINGS AND KEY INSIGHTS

New Target Segment Identified – Aimed at digital-first, sustainability-conscious consumers who prioritize ethical sourcing and personalized experiences.

Loyalty Enhancement Strategy – Suggested tiered rewards, gamification elements, and AI-driven recommendations to improve engagement.

Retention Metrics & KPIs – Proposed tracking repeat purchase rates, active Starbucks Rewards users, and personalized offer redemption rates.

RESULTS AND STRATEGIC RECOMMENDATIONS

Introducing Exclusive Sustainability Rewards – Offering eco-conscious incentives, such as discounts for reusable cups and ethical product purchases.

AI-Powered Personalization – Enhancing app-based recommendations based on purchase behavior and preferences.

Gamification & Tiered Loyalty Program – Encouraging continued engagement through milestone-based rewards and limited-time challenges.

CONCLUSION

Through this final course requirement project, I developed a strategic retention marketing framework for Starbucks, reinforcing the importance of personalization, customer engagement, and value-driven loyalty programs. My analysis emphasized how data-driven insights and experience design can strengthen brand loyalty and maximize customer lifetime value.