Starbucks waters down its reward program, doubling number of points needed for free coffee

Much like it has done to just about every other facet of Canadian bills, inflation has come for your morning coffee.

Starbucks is rolling out new rules for its loyalty program in the United States and Canada on Monday, changes that in some cases could see customers need to use twice as many points to get the same items they got before.

Customers will need to spend 100 stars — the chain's version of reward points — for most of its most popular individual items, including a hot drip coffee or tea, a baked good or prepackaged snack.

Previously, those items only cost 50 stars. How much they get you is changing, but the way to earn them is the same: a customer gets one star for every dollar they spend on Starbucks items using cash, debit or credit. Paying with a preloaded gift card will earn two stars for every dollar spent.

It's not just the basics going up, either. More expensive items like Frappucinos or hot breakfast items will now cost 200 stars instead of 150, and the price for a salad or sandwich is going from 250 to 300 stars. 

A small number of items are getting comparatively cheaper, however. A 454-gram bag of packaged coffee that previously cost 400 stars will now costs 300, and an iced coffee that used to cost 150 points will now available at the cheapest, 100-point tier.

"To ensure the long-term sustainability of the Starbucks Rewards program and to meet the changing needs of our members, we occasionally need to make changes to the program, and while some items may require additional stars to redeem for, other popular items like iced coffee and packaged coffee will need less stars to redeem for and be easier for members to be rewarded," a spokesperson for Starbucks Canada told CBC News in a statement.

It's not the first time the company has recalibrated its reward program, with the previous major change coming in 2016 when the company switched from a system that gave reward points based on the number of visits to one that doled them out based on how much money was spent.

Indeed, Starbucks isn't the only coffee chain watering down its reward system of late. In December, Tim Hortons made similar changes to its loyalty program, hiking the price of a coffee from 70 points to 400. (Timmies shoppers earn 10 points for every dollar they spend at the chain.)

U.S. chain Dunkin' Donuts rolled out similar changes in October.

Patrick Sojka, the founder Rewards Canada, says the devaluation of loyalty points is probably the No. 1 issue for the loyalty point fanatics who make up his company's customer base.

"It's huge among the whole points and miles world," he told CBC News in an interview. "Whether it's travel like with frequent flyer programs, frequent guest programs, or in this case with coffee programs [there's] lots of negativity around that."

Sojka said he expects Starbucks to get some blowback for essentially slicing its reward tiers in half, but ultimately the chain is doing what they're doing because they know they can. 

"For the first couple of months [customers are] not going to be happy," Sojka says. "But they'll go back to their old ways after a few months. We've seen it time and time again."

Kendra Tanev is the type of customer that Starbucks is banking on.

"I do collect the points, but ... half the time they probably go to waste because I don't really redeem them regularly," she told the CBC outside a Calgary Starbucks location recently. "I'm going to buy the product anyway, so it doesn't really matter."

WATCH | Shoppers react to Starbucks' new loyalty point system:

Watered down Starbucks rewards leaves bitter taste

2 years ago

Duration 0:58

Starting today, Canadian members of Starbucks loyalty program will have to spend twice as much as before to get a 'free' cup of coffee. Coffee drinkers in Calgary shared their thoughts on the change with CBC News.

But there are other customers for whom the change has left a taste a bit like burnt coffee in their mouth: bitter.

Calgarian Sheldon Harrish said he used to go to Starbucks seven days a week, but the current era of high inflation has him much more aware of his spending, so he's drinking more coffee at home lately, and going to Starbucks half as often as he used to.

News that his loyalty points would soon be worth half as much, too, makes him even less likely to go from now on.

"It becomes less and less of an incentive," he said. "It makes you look for other alternatives."

Fellow Calgarian Megan Williams had similar thoughts. "I think I spend enough money at Starbucks as it is, the drinks are not cheap, so yeah, it definitely bothers me," she said. "I probably won't go as often anymore."

Loyalty test

Nicole Rourke, a professor of marketing at St. Clair College in Windsor, Ont., says that it's well known that loyalty points are a fairly inexpensive way for brands to create repeat customers, but they are starting to get watered down to the point where they are losing their effectiveness.

"Most frequent Starbucks customers are buying the same things over and over again. If you make it more complicated for them to get free ones, I just don't think they like it," she said. "They'll come up with reasons why they should go somewhere else.

She said she recently discussed Starbucks' changes in a class with her third-year students, and the conversation among a group of brand-savvy young consumers was eye-opening. 

"They already felt like it took a long time to get any big rewards back," she said, adding that rolling out the changes the day before Valentine's Day "is not making them feel the love.... It's making them feel like they want to be less loyal."