Email Marketing Case Study: Share Joy with Starbucks

As a total Starbucks addict (don't believe me? Check out my last blog post!), I am part of a twenty-something subculture that thrives on new and seasonal Starbucks drinks. Needless to say, when Christmas rolls around, myself and many other coffee junkies are thrilled by the latest drinks, snacks, and decorations that flood Starbucks' nationwide. When Starbucks decides to introduce a promotional campaign, it basically sends the Starbucks obsessed into a caffeine-induced spiral.

A few days ago, I received an email advertising the Starbucks Share Joy campaign. The concept behind the promotion: between November 13th and 17th, consumers will receive two handcrafted holiday beverages for the price of one, including the Gingerbread Latte, the Caramel Brulee Latte, and the Peppermint Latte.

The email also contained other seasonal offerings:

How to share your fabulous #redcup on Instagram,

Information on the seasonal Christmas Blend.

Details on holiday treats (#OmgYumCranberryBlissBar).

How to send holiday egifts,

Info about the Verisimo coffee system,

And how to receive text updates about holiday deals!

The target of the email campaign is Loyalty Card Members, as these wonderful emails are sent to only them. Starbucks loyalty membership has two tiers: green, which can be obtained after purchasing 5 Starbucks drinks on a card, or gold, which is achieved by gaining 30+ stars per year on a card.

The primary Starbucks purchasers are upper-middle class men and women aged 25-45, but the loyalty program skews slightly younger (18-45). This may be due to the more modern concept of a loyalty program and the mobile integration, which comes naturally to a younger demographic.

Starbucks, being a competent and established company, easily follows Constant Contact's guidelines for effective email marketing. However, most notably, Starbucks excels with #3: send relevant content that has value for recipients. Since they are only sending these emails to people in the loyalty program, there is a high chance that these people have been waiting patiently for Starbucks' seasonal drinks and will take advantage of the promotion.

Another way in which Starbucks' email marketing campaign is effective is their ability to drive referrals. The buy one, get one free campaign will drive in repeat users, but there is an increased chance that those people will bring in non-Starbucks drinkers. After they enjoy a fantastic seasonal beverage, there is a chance they will return to the store on their own time.

Also, one of the most difficult aspects of a digital campaign is an effective email title. Starbucks manages to attract consumers through clever, yet concise language.

Overall, Starbucks has excelled at turning an often annoying, intrusive marketing tactic into an opportunity to share their product with their most loyal consumers.

Mobile Marketing Case Study: Starbucks App

What was once a humble local coffee shop in Seattle, Starbucks has quickly expanded to become the largest coffeehouse company in the world. Boasting hot and cold beverages, whole-bean coffee, full-leaf teas, pastries, and snacks, Starbucks has become associated with an upscale cafe experience. As technology began to shift, Starbucks needed to innovate in order to remain the leader in the field.

And with that, the Starbucks App was born.

How does it work? The Starbucks App is like a Starbucks Card, store locator, e-gift giver, and rewards tracker all wrapped into one.

Users can...

• Reload and manage their Starbucks Card. With a few taps on the screen, users can reload money onto their pre-existing Starbucks card or apply a physical card's worth onto the app.
• Locate the nearest Starbucks. Using GPS technology, the app can recognize the closest Starbucks to any location.
• Give Starbucks cards to their friends. Within a few clicks, users can send highly customizable cyber cards to their friends.
• Track their stars. Starbucks' star rewards system gives users stars for each purchase, which are redeemable for free drinks and foods. Users can see how many free items they have accumulated and when they will be receiving their next perk.

Who is using it? A lot of people, apparently! As of July 2013, it was reported that over 10% of transactions were made over the Starbucks app. If you consider how many stores their are worldwide, and how many consistent customers they have (many of which go more than once in a day), that is a lot of mobile purchasing.

The Starbucks app is used mostly by men and women aged 24 to 34. An interesting study revealed that although most mobile payment apps are primarily used by men, the Starbucks app is used by 54% women. This proves that the app is intuitive even for those unfamiliar with mobile commerce.

Is it effective? Absolutely.

As an obsessor of all things Starbucks, this app has truly revolutionized the way I interact with the brand. Plus, and I didn't even know this would be possible, the app makes me go to Starbucks even more. Why? Because I reload my card with just a few clicks, it doesn't feel like I'm spending excessive amounts of cash on my coffee habit. It's incredibly dangerous, but incredibly effective.

Don't believe me? The 10%+ of payments made via the app should speak for itself. In case that doesn't, it was reported in January of 2013 that over 7 Million users were signed up for the app. In that same study, they reported 2.1 Million payments were made through the app per week.

In conclusion, the Starbucks App fuels the user to stay a loyal customer, much like the caffeine in Starbucks' coffee fuels the world.

Web 2.0 Case Study: Etsy

In today's marketplace, the Web 2.0 model has altered the modern definition of business. Compared to commerce in the Web 1.0 age, today's collaborative method allows the consumer to be in control. However, the minimalist movement sweeping the nation has brought increased awareness to local shops and independent markets. One company has managed to expertly combine both trends into one business model.

Etsy, founded in 2005 by a team of three businesspeople, is an e-commerce site selling handmade and vintage items, as well as art and crafts supplies. Considered by many a "digital craft fair", sellers worldwide are given personal storefronts where they list their goods for a fee of $0.20 per item. Etsy has been described in the e-commerce world as "a combination of Amazon, Ebay, and your grandmother's basement". It's clearly working for them: as of August 2013, they are reporting 30 million users and over $1 billion in total annual transactions. But instead of me telling you, hear it from the workers in Etsy's office located in Brooklyn, New York.

In terms of Web 2.0 strategy, they employ a one-to-one marketing approach. They recommend items to the user based on one's past purchases. Continuing with their charming and quirky branding, they refer to this section as "Handpicked Items".

Etsy does an excellent job of tackling the Principles of Wikinomics. Firstly, they excel at openness. They are incredibly transparent to their customers: in an August 2013 interview with CEO Chad Dickerson revealed their company ethos:

"At the end of every transaction, you get something real from a real person. There is an existential satisfaction to that."

They also recognize issues within the company that need to be resolved: for example, in April 2012, they announced steps were being taken to hire more women engineers to improve the gender balance of its team and to better understand their target demographic.

Additionally, external contributions are what drives the site as a whole. Without outside sellers, the website would fail to function as a whole. It is incredibly simple to sell, with Etsy charging $0.20 to post a listing and taking 3.5% of every sale post-purchase.

In terms of a hierarchy, Etsy on the whole follows a peering organization. Etsy has a definitive CEO, Chad Dickerson, and a few other upper-level managers, including a COO, CTO, and Vice President of Finance. Below them are directors, and after that the lines of "upper-level management" becomes blurred. Worldwide, there are approximately 400 Etsy employees, and the company encourages self-organization and open, continuous dialogue.

Sharing is an integral part to Etsy's strategy. By sharing their intellectual property with sellers internationally, the business is able to sustain itself while marketing the goods of others. Etsy acts as a wonderful resource for individuals worldwide to sell their items, ultimately sharing their technology and bandwidth. Even though e-commerce is a competitive business, even European CEO Philip Flynn is quoted as seeing the benefits of collaborating.

"As far as I am concerned, the more people highlighting the value of supporting micro-producers and buying handmade vintage directly from them, the better."

Etsy performs as a global marketplace. Although the company originated in America, their shop is accessible worldwide, and sellers are invited to offer worldwide shipping. They have employees around the world but they work as one, ultimately serving the same website. They have a standardized support hotline that can be accessed anywhere in the world, and the same FAQ section for every country.

As a major fan of Etsy, I find their business model to be innovative and effective. They have managed to combine the charm of artisan shops with the highly successful Web 2.0 business methodology while profiting. They are incredibly transparent in their business practices, which are seemingly very honorable and humane. Their webpage is easy to navigate and user-friendly, making it easy for users to buy and sell vintage and handmade items. Etsy has found their niche in the world of e-commerce, and they offer a service that is unmatched by similar websites.