Last March Starbucks announced that they planned on introducing a prepaid card later in 2016, which would be issued by Chase. Generally I don’t get too excited about prepaid cards (since the rewards are limited), so I didn’t have very high hopes of it. Well, 2016 is now over (and for that matter 2017 is almost over), and we still haven’t seen the introduction of a Starbucks prepaid card.
It looks like Starbucks now has slightly different goals. In a Seattle Times story about Starbucks’ disappointing financial performance, it’s noted that Starbucks and Chase plan to introduce a co-brand credit card this winter, with a prepaid card to come “later.” It seems that the company has changed their focus, because previously they had plans to introduce a prepaid card, but we hadn’t heard anything about a credit card.
The company has said that the credit card would allow members to earn Starbucks Rewards when they spend. I guess we’ll have to wait and see what that actually looks like in practice. The way I see it, there are a few ways they could go to differentiate this card:
- Offer a significant return for Starbucks spend (maybe 5%+)
- Offer Gold status for as long as you have the card (not that it’s otherwise that hard to earn or that it’s that valuable, but it’s better than nothing)
- Maybe they could award “stars” rather than dollars as rewards; stars can be redeemed for virtually any item at Starbucks, so at least gives the opportunity to get outsized value
It’s always interesting to see more co-brand products beyond the traditional miles & points space. For example, earlier this week we saw the introduction of the Uber Visa Card, which is surprisingly lucrative. However, oddly it’s a useful card in spite of the fact that it has almost nothing to do with Uber in terms of earning and redeeming rewards, as well as benefits.
I suspect a Starbucks co-brand card would be integrated a bit more closely, but I could be wrong.
What would you like to see from a Starbucks credit card?
(Tip of the hat to Evan)