Tuesday, January 10, 2012

Starbucks Price Increase for Loyal Customers

The price of coffee as a
commodity rose and fell
 during 2011
Starbucks has restructured its UK Starbucks Rewards Card programme and removed the "tall filter for £1" part of the offer. Now, customers will pay £1.50 but receive a free coffee for every 15 purchased. Customers on the old rewards card scheme have been put on gold level meaning they retain the other free extras they used to get, but my guiess is that most regular customers will now be out of pocket with, what is in effect, a 40-50% price increase.

My initial obserrvations is that Starbucks has got quieter at peak times in the morning and afternoon.

The price increase has been caused by sharp rises in raw coffee prices and reflects price increases by Starbucks in other markets recently. Prices for coffee peaked in October after a sharp rise over the summer, prompting retailers to increase prices Prices have since fallen back to a lower level. It remains to be seen how Starbucks will react to the price fall.