Starbucks Figured it Out, Have you?
My Starbucks Story
For the past few years, I bought my coffee at the Starbucks drive-through a few times per week – particularly on Mondays and Fridays, which always seemed to be the busiest mornings for me. It would take only 2-3 minutes to order my coffee and be on my way.
One Friday morning, a free Starbucks sandwich coupon appeared on my mobile.
After my jog the following morning, I decided to go into the Starbucks store, order my usual coffee, and get my free breakfast sandwich. Once inside the store, I pleasantly discovered that my Starbucks location offers a variety of healthy breakfast foods as well as a great selection of major newspapers like the Wall Street Journal, New York Times, USA Today, and even my local paper. With having free Wi-Fi, a charging station for my multiple devices, and great music, I definitely found my new hot spot.
Now I frequent Starbucks just about every morning. Sometimes using the drive through, but when I have time to go in, I order my favorite coffee and healthy breakfast, and on weekends I read my favorite newspapers while charging my phone.
This kind of loyalty isn’t an accident; it’s the result of an organization that understands its audience and how to build trust and loyalty with the consumer over time.
Building Brand Rituals
You might be thinking, “Yeah – but that’s Starbucks! They’re an international brand with millions of marketing dollars at their disposal.” The reality is, Starbucks is that international brand with millions of marketing because they have dialed into their audience to understand their lifetime value. Lifetime value is about building brand rituals into your audience’s life by making them the hero. That coupon I received took my established pattern of the convenient morning coffee to the next level of customer loyalty.
Thriving organizations strive to achieve the concept of routine loyalty. Your organization is the solution to the consumer’s challenge or desire. The relevant innovations and experiences you provide should be used to build connections. Like that everyday Starbucks coffee, an organization should strive to be the answer for their audience on a constant basis. The idea is to integrate your brand’s story into the consumer’s life. How you do this requires looking at the long game. Starbucks has figured it out – and so can you!
Create Lifetime Bonds by Aligning Core Values
You might be wondering how your organization can do this. It can! It starts with identifying your target audience and connecting with donors who will invest not just in your immediate project but in the future. What’s the big picture? Donor lifetime value (LTV) is all about donors who continually contribute to your organization, time and time again. That means they need to believe in you and what you’re doing. You have to maintain that commitment; basically, you want to be that daily Starbucks coffee – the thing they regularly focus on. To do that, your marketing must communicate your core values. The commitment you have from mid-level sustainers is a great indicator of how your marketing campaigns are working.
Return on Brand Presence
An organization needs to utilize its concept of customer lifetime value the same way Starbucks does. It takes many loyal customers, not just one, to make a successful business. The same goes for donors. You want to achieve as much LTV with them as possible. While you will always need to spend money on attaining new customers and donors, it’s a lot easier and more cost-effective to retain the ones you already have. They’re your loyal supporters, after all, and they’ve already made a commitment to you.
You need to keep them engaged if you want them to keep coming back. Retention is best done through SMS marketing, strategized social media campaigns, and streaming video on various internet channels. You must keep mobile advertising and cross campaigns fresh and accessible, and maintain outreach through email initiatives such as newsletters. The best way to keep your donors is to give them a reason to continue to give.
Effective campaigns are true to their audience. It’s critical to give people a great reason to come back to you again and again. Making sure you’re top of mind is critical. Once you have a strategy that bolsters your company for the future, you’ll get the kind of returns faster than you can order a latte.
One of the most eye-opening and rewarding business practices is assessing lifetime value. When you know the LTV of your sustainers, you’ll truly understand the value of your marketing and retention expenditures.
The goal of this post is to provide broad brushstrokes to help you identify your sustainers’ lifetime value. The next logical step is calculating that value. Starbucks has a fascinating infographic that takes you through their complex LTV calculation. It may feel overwhelming and complex to come up with your LTV, but in time you’ll see that it’s well worth the effort.
We’re working on a great resource that will make you comfortable in the valuation process. This will be a strong starting point for either revisiting your current LTV or calculating it for the first time. Leave a comment below if you’d like to be among the first to receive this valuable resource. Otherwise, keep your eyes out for an upcoming post that will walk you through the calculation process that identifies your sustainers’ lifetime value.
