The Card-Carrying Starbucks Fan

New York Times, June 7, 2008 — IN 1981, when American Airlines was struggling to differentiate itself in a newly deregulated industry, it invented the frequent flier mile. Ten years later, American Express responded to its own competitive crisis by introducing what we now know as Membership Rewards.

So it shouldn’t come as any big surprise that Starbucks, facing its own troubled times, would also turn to a loyalty program.

This week, the company flipped the switch on the latest piece of its new Starbucks Card Rewards program: two hours of free wireless Internet service a day. The other freebies include syrup and soy milk additions to its drinks, refills of drip coffee and a tall beverage of any sort for people who buy a pound of whole bean coffee.

Award Plans Earn Cash for Airlines

New York Times, April 1, 2008 — Travelers have been complaining more often about frequent flier programs — namely, the lack of award seats on desirable flights, escalating fees for ostensibly free tickets and quicker expiration dates for miles.

The airlines counter that they are giving away more awards than ever, despite generally fuller planes, and that most programs allow members to book any open seat on any flight, albeit in exchange for more miles.

In a sense, both sides are right. But this debate misses a fundamental change that has occurred in the economics of frequent flier programs in the last decade. What began 27 years ago as a way to win the loyalty of travelers has turned into a lucrative business for the airlines.

A Million Miles vs. a Few More Smiles

New York Times, January 13, 2008 — JAMES T. KANE, a corporate consultant on customer loyalty, has a news flash for his airline. “I hate you, and I tell everybody I hate you,” he says. “You could not pay me to get on your airline if I didn’t have to. The reason you think I’m a happy customer is I flew 178,000 miles on you last year — but that’s because I didn’t have a choice.”

Loyalty Points That Buy A Night With John Travolta†

As Guests Build Big Balances, Hotels Expand Their Rewards Way Beyond Free Lodgings

Wall Street Journal, December 26, 2007 — For 124,000 Starwood Hotels & Resorts points, Michael and Georgia Soares might have spent six nights in Paris at Starwood's Hotel Prince de Galles on the Champs-Elysees. Instead, the Southern California couple used their hotel points to spend one night with John Travolta and the cast of the movie "Hairspray" at the film's New York premiere.

Service, Convenience Create Loyalty Leaders Like Google

MediaPost Publications, November 19, 2007 — RISING GASOLINE PRICES, THE NEED for speed, and convenience are cited as driving consumers' loyalty to Internet companies and online catalogues. Google is, in fact, the No. 1 brand in the 10th annual Brand Keys Loyalty Leaders List, compiled by the New York-based marketing consultancy.

Starwood Hotels Unveils Preferred Guest Web Site

MediaPost Publications, August 9, 2007 — STARWOOD HOTELS & RESORTS HAS rolled out a newly revamped consumer loyalty Web site designed by Firstborn Multimedia.

In addition to providing the requisite property info and booking functionality all on one page, the new site at www.SPG.com aims to create a highly customized experience for Starwood Preferred Guests through the "My SPG" portal.

Tesco Studies Hard for U.S. Debut†

CEO Leahy Sends Teams to Observe How Americans Shop, See What's in Their Fridges

Wall Street Journal, June 28, 2007 — The chief executive of Tesco PLC, Terry Leahy, runs a retail chain that's twice the size of Wal-Mart Stores Inc. in the United Kingdom. And this fall, even though the U.S. is considered over-crowded with stores, Mr. Leahy plans to expand into Wal-Mart's home turf.

Bad News For Brands: Supermarket Shoppers Don't Care

MediaPost Publications, June 26, 2007 — WHEN SHOPPING IN SUPERMARKETS OR drug stores, are consumers likely to show any brand loyalty? Practically none. A new report from TNS Retail Forward finds that three-quarters of shoppers will happily switch brands, motivated not just by what's cheaper, but even what's at eye level. "Few brands are immune to switching behavior," the market researcher reports.

Baby Boomers More Loyal To Service Providers Than To Products

MediaPost Publications, May 17, 2007 — BABY BOOMERS WERE REVOLUTIONARY--BUT THEY are less brand-loyal than preceding generations. According to a study released this week by market-research firm Focalyst, a joint venture between AARP and the Kantar Group, boomers defy expectation. The Focalyst data provides specific measures of boomer "brand loyalty" for products and services, drawing on a panel of about 35,000 consumers over the age of 42.

Brand Loyalty Only Goes So Far†

Brandweek, May 14, 2007 — A new study finds that 21% of shoppers that are loyal to a particular brand require it to be on sale before they'll make the purchase. Some shoppers will even travel to other stores in search of deals, according to the online survey of 650 grocery shoppers conducted in April by Synovate, Chicago. The phenomenon was most common among ice cream brands where 36% of respondents were dubbed system beaters.