Up For Discussion: Free Refills, a Green Level benefit of MyStarbucksRewards

I’ve decided to write a few articles about the  MyStarbucksRewards program.  And, for the most part, I will be focusing on the Green level of benefits.  It only takes five purchases with your registered card to be elevated to the Green level.

As a reminder, any registered Starbucks card can earn you rewards.  In the U.S., it is estimated that about 25% of all transactions are with a registered card, and that there are more than four million active card holders.  That’s a lot of Starbucks cards in use!  Understanding these rewards is more important now than ever before.

The articles will be published on upcoming Fridays, as follows:

  1. A close up look: My Starbucks Rewards at the Green Level – Free Syrups and Milk Changes (July 27, 2012)
  2. A close up look: My Starbucks Rewards at the Green Level – Free Tall Beverage with Whole Bean Purchase (August 3, 2012)
  3. A close up look: My Starbucks Rewards at the Green Level – Free Refills (August 10, 2012)
  4. A close up look: My Starbucks Rewards: Areas of confusion at the Gold Level (August 17, 2012)

I am asking that the conversations in these threads stay on topic.  I realize there is a lot to say when it comes to MyStarbucksRewards, so I’m hoping the “Free Tall Beverage” conversations won’t spill into the “Free Refills” thread, for example.

Caveat: This series of articles represents Melody’s understanding of the rewards, and may materially differ from what is stated on the Starbucks website.  These articles pertain only to the U.S. market.   I’m writing a series of articles, and I hope that I closely match the intent of what the rewards program represents.

As many people know, the very first generation of my Starbucks rewards was announced in March 2008, at that year’s annual shareholders’ meeting.  In many ways, the basic rewards haven’t changed much since then.  Back in 2008, there was only one level of awards, and those awards were essentially all the current “Green” level rewards.

FREE REFILLS:

The first point of clarification is that this benefit does NOT require the customer to have reached the “Gold” level of benefits.  I have frequently heard baristas tell customers that you get a free brewed coffee refill “with a Gold Card.”  That implies that you wouldn’t get one with your ordinary card at the Green level of benefits.  This is a Green level perk.  And please remember, there is never any requirement that a customer switch to the shiny gold card.  All the benefits are associated with the Starbucks.com/card profile, not the actual physical card.

On the topic of “Free Refills” the easiest thing to do is simply start with what is NOT covered.  In no particular order, here are some situations where there is NO free refill benefit.

Not covered:

1. If you’re using a drive-through, there is no free refill benefit.  At least this part of this benefit is clear and unambiguous.

2.  If you want to get a refill price on an espresso beverage, that is not a benefit.  In other words, if you drink a tall latte, and then you want a second tall latte (and you’ve stayed inside the store), there is no refill price for a latte.  The only items that are ever the refill price are brewed coffee (whatever happens to be brewing at the moment), iced coffee, and iced tea (meaning black, green, or passion tea.)

3. If you leave the store, there is no longer a free refill benefit. (However, we’ll see that there is some ambiguity with that.)

4. Essentially, if you are a “walk in” customer, there is no free refill.  You cannot walk in and get a “refill” priced brewed coffee, iced coffee, or iced tea.  You have to have already stayed in the store drinking your first beverage.

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Just as an aside, the “Free Refill” benefit might be my least favorite perk.  This not because I don’t use it – I certainly have – but from what I can see, it is the perk that causes the most confusion.  It seems to operate almost the opposite as what Starbucks really intended.

Here’s what the Starbucks website says.  For the record, I find this to be one of the most confusingly written things on the entire Starbucks.com site:

Free refills while you’re here

Go ahead, stay awhile. Brewed or iced coffee or tea refills are on us while you’re in the store.
See what qualifies.

Use your registered Starbucks Card to pay for a brewed or iced coffee or tea and then bring that same card back to the register for a refill during the same visit. (This isn’t valid on Caffè Mistos, Starbucks Reserve™ or Clover® Brewed coffees – or the coffee you grab at the Drive Thru window.) Offer is subject to change and is valid at participating stores.

If you notice, the website singles out “Caffe Mistos,” “Starbucks Reserves” and “Clover brewed coffees.”  It almost makes absolutely no sense that those are singled out, at least in the manner that they are singled out above.  I think that this is what that above paragraph is trying to say:

Free Refills While You’re Here:

Go ahead. Stay  for a while.  Brewed or iced coffee, or tea refills are on us when you’re staying in our stores.  (See what qualifies.)

Use your Starbucks card at the green level, and pay for your refill while visiting in the store.  The beverages available for a refill price are brewed coffee, iced coffee, and tea, hot or iced.  No other beverages are available at a refill benefit price.  (This benefit also does not include coffee brewed with a Clover brewer, or any coffee made with Reserve coffee beans.  Also, coffee prepared as a Caffe Misto is not available at the refill price.  We’re sorry – we know that those are coffee beverages too, but there is no refill price for those unique hand-crafted coffee beverages.  It’s a lovely benefit, and has have a few limits on it.)  Offer is subject to change, and is valid at participating Starbucks stores.

I want to  mention some common myths about the free refills.  I’ve seen both partners and customers get tripped up on these common pitfalls:

Common myths and pitfalls:

I bought a tall Pike Place Roast at the store on the corner of Fourth and Union.  Later, I walked across the street to the Puget Plaza Starbucks.  They are only literally just across the street from each other.  Can I get a tall Pike Place Roast at the refill price at the Puget Plaza Starbucks?

No, no, no.  You left the store. It is NOT a refill.  You must pay full price for your tall Pike Place Roast at the Puget Plaza Starbucks.  It doesn’t matter that they are literally across the street from each other.  You left the store.  However, please ask the barista to give you a personal cup discount.  You get ten cents off your beverage for having brought in your own cup.  (Even though local health code will require that the Starbucks give you a new paper cup.)

I thought that if I bought one brewed coffee in the morning, I could get refills all day long, even if I came back later after work?

No, no, no.  If you leave the store, there is no longer a refill benefit.  If you stay inside the store, there is a refill benefit.

I work inside a tall office building.  Can I get a free refill so long as I have not left the building?

No, no, no.  There are definitely Starbucks in the lobby level of tall office towers.  In those circumstances, it’s often true that customers may only travel a short distance between their favorite Starbucks and their office.  It is still not a free refill, or refill priced.  If you leave the store, there is no longer a refill benefit.

Is there a time limit on how long I can stay inside Starbucks drinking free refills?

As a customer, I have never seen any customer-facing materials that express a time limit on free refills.  I have a distinct memory of Howard Schultz in 2008 (when announcing the then-new card benefits) saying enthusiastically, “Stay as long as you like…”  To this day, I think that is the intent of the program.  I have seen partners state that there is a two hour benefit.  Once upon a time, there was a free wifi benefit with a registered card that had a 2-hour limitation.  That limitation related to the free wifi benefit of 2008 – 2009, before it became free wifi everywhere, all day.

Can I get a free refill if I went outside and had my beverage on the store’s patio?

I don’t know the exact answer to this.  I’ve actually heard baristas say both yes and no to this.  It would seem to me that since you’re still on the store’s property, you should be able to get a free refill.  This appears to be another area of ambiguity.

My favorite Starbucks is tiny kiosk with no seating, like the Century Square Starbucks.  Can I get a free refill?

This is another area of ambiguity.  Since there is no actual way to stay “in” a kiosk store, it seems like there would be no way to get any free refills.

I bought a tall Pike Place Roast, and I have been sitting inside the store reading the paper.  Can I get a pour over of the dark roast pick of the day as a free refill?

This would be yet another area of ambiguity.  I don’t see that the website really addresses this situation.  I believe that the answer is “no.”  The barista should then charge the customer for a tall dark roast.  The reason that I say this is because this benefit is not really intended to include any beverages that are handcrafted or time consuming.  Because of the extra labor involved of the pour over, I don’t think that was intended as a “refill” benefit.

I went to Starbucks and bought a tall mocha, and I did stay in the store.  Can I get a tall Pike Place Roast as a refill now?

I think the answer to this is yes.  I don’t think the website really addresses this situation.  Consistently, moderators at MyStarbucksIdea.com will say “yes” this is a benefit.  It makes little sense to tell a customer, “I’m sorry, you should have bought a cheaper drink if you wanted free refills.”  And in theory, if the benefit is strictly limited to in-store customers, it’s not an expensive benefit to offer.

I’ve been told by partners that the Beverage Resource Manual describes the free refill benefit as a benefit, “regardless of original drink purchased.”  I’ve never actually seen that in writing, but if you’re a partner, check the BRM to see if this is mentioned in it.

I went to Starbucks and bought a tall mocha, and I did stay in the store.  Can I get a tall iced black tea refill now?

I think the answer to this is yes.

If the customer is switching from a hot drink to a cold drink refill (or vice versa), I’ve known many partners who will bristle at that.  I really can see the reluctance to give the customer the benefit of switching from a hot to cold drink as this will always mean a new cup.  I think I might bristle at this too if I were a barista.  Technically though, I think you can.

This is a really confusing benefit with lots of areas of ambiguity.  What did Starbucks really intend when they thunk up this benefit?

The rationale behind the free refill benefit is as follows, or at least this represents my best guess:

  • People who linger inside a store might spend more money on additional pastries or food.  Since the cost of a cup of Pike Place Roast is small, it might be worth it to encourage people to stay, and hopefully sell additional product as well.  Iced tea is really mostly water, and is also cheap to produce.
  • An empty store is never welcoming.  It’s a good idea to encourage a few people to linger.
  • We know that 80% of customers take their beverages “to go.”  If partners enforce this right, it won’t cost the company much because it will apply to only a small customer base.
  • Free refills help develop goodwill and a third place environment.
  • The overwhelming majority of customers are not going to stay long enough to have more than one or two refills.  The overwhelming majority of customers are “to go,” or stay briefly.
  • Seating limitations will help control how much this benefit gets used.  Since it’s only for in-store customers, it can really only be used by a small percentage of customers.
  • The daily brewed coffee, iced tea, hot tea, and iced coffee are very high margin beverages.

As you can see, how the benefit was intended, and how it is now applied in the stores are almost in complete conflict with each other.  Baristas routinely say “yes” to customers who should not get a refill, and sometimes say “no” to customers who SHOULD get a free refill

Now it’s your chance to weigh in on this perk.  What are your thoughts on this?  Basically, any card benefit that requires well over 2000 words to explain is too confusing.