A Case Study on how Starbucks is the Ultimate Star Coffee Chain

At Bengal Institute of Business Studies, the MBA course for Business Analytics and Data Science focuses on a more practical approach. The students are given a more hands-on learning experience through case studies and corporate sessions. 

BA& DS students at BIBS study real-life cases, such as Starbucks' use of data to provide their customers better service. Starbucks is an American multinational chain of coffee houses and roasteries. It happens to be one of the largest coffee house chains in the world. Starbucks is known to regularly use their loyalty rewards app among some major restaurant chains. This case study  helps to explore and analyse what makes the customers come back for more and what is it about the app that makes it a ‘must have’ for consumers.

According to a recent study that was conducted, Starbucks is seen to have the most regularly used loyalty rewards app compared to other major restaurant chains. The most prominent and obvious answer that was found regarding the popularity of the app was digital engagement. 

With the help of the app, not only can you order your coffee ahead of time but you are also given personalised suggestions. All these things contribute to the experience of the user which makes the Starbucks app experience unique and interesting, in comparison to other similar apps.

The case study explores 3 of the most crucial reasons that make the Starbucks app a ‘must have’ for consumers.

1. User-friendly experience - Starbucks is able to provide a personalised experience for each user with the help of user data collected through the App. It uses this data to provide a customized experience for every individual user. The barista has access to the customer’s previous orders which helps them in providing suggestions to the customer. 

Starbucks uses the geo-location to determine the nearest stores, they use order history to determine a customer’s favourite order and also items they might like. 

The app also shows the user the location of the nearest Starbucks, the menu available there, and one can even place an order through the app which will be ready on the user’s arrival. This feature makes it hassle-free, as well as user-friendly. Since it makes ordering more convenient for the consumers, they are more inclined to use it. 

2. Loyalty Program - The Starbucks Rewards program is one of the major reasons why users are drawn to the app. The more one spends at Starbucks, the more points or stars they receive. The program offers many benefits to the people who use the apps. Based on collected data, the app also offers customisations to the users as well as personalised suggestions that are based on the user’s past orders. They use the data that they receive and use a point system to give offers to the users based on their past orders. For example, if a user has 1000 points then they can claim a free beverage. 

3. Online ordering and payments made easy - With their Mobile Order and Pay feature, the Starbucks app lets the users order ahead, make their payments online and skip the line when they go to pick up their order. This has made the app extremely user-friendly and it is convenient for consumers belonging to all walks of life. The app uses data to make suggestions to the user on what they should order and new things that they could try based on their order history.

The company also uses the information they get, to build more relevant marketing campaigns and promotions, decide locations for new stores or potential business and even decide future menu updates. An MBA in data science is helpful for students who wish to have a career in this field.

Through the medium of this case study, the students of the Business Analytics and Data Science MBA program at BIBS were able to analyse the data they received and gain insights into how much revenue the business gained. At BIBS, students have a more practical approach to learning which allows them to gain industry experience which prepares them for their future. The college also conducts corporate sessions with prominent business leaders which gives them an edge over other students in other colleges.