278. How Starbucks Leverages Behavioral Economics (and you can too) (Refreshed Episode)

<p dir="ltr">As a Seattle girl, I love me some Starbucks so it is fun to refresh this episode which was one of the first (and most popular) behavioral economics analysis episodes I’ve ever done. It is currently the 11th most downloaded episode of the show of all time, and with 277 episodes to date, that is a pretty big deal! If you aren’t familiar with this format, it is an episode where I talk about a well-known company and their practices to share what concepts from behavioral economics and behavioral science in their work so you can see what you might want to emulate and what isn’t a good fit for you in your company. </p> <p dir="ltr">So, why this episode from late 2019, and why now? Well, it is because of the loyalty program and this coming Friday’s episode where I am joined by Lauren Kemp and Stephen Springfield to talk about how they created an “irrational” loyalty program at McDonald's during the pandemic. It is a fascinating story with lots of insights for you to learn.</p> <p dir="ltr">Today, I chose to share an episode that showcased another loyalty program doing a lot of smart things that are different from the traditional punch card approach to loyalty. (And, good news, there is a lot more to this episode that I know you’re gonna love.) So grab a coffee, and settle in…</p> <h3 dir="ltr">Show Notes:</h3> <ul> <li dir="ltr">[00:40] Today’s episode is a behavioral economics analysis of Starbucks.</li> <li dir="ltr">[04:01] In this episode we are going to dig into their Star Rewards program, featured drinks, and products, the coveted red cups, their personality, overall brand choices, their logo, locations, social media, and pricing. </li> <li dir="ltr">[04:23] Without the original brand and pricing, Starbucks would be just another coffee shop.</li> <li dir="ltr">[05:57] One of the big aspects Starbucks had to overcome was the pricing anchor. </li> <li dir="ltr">[08:41] Howard Schultz and Starbucks took a step back. They got out of their own way and created a new category which ended up changing the conve