Starbucks' New Reward Program Leaves Many Feeling Penalized

The latest data from TickerTags indicates that Starbucks Corporation SBUX may be shooting itself in the foot with its new rewards program. Starbucks announced the rewards program in February and launched it earlier this month. In that time, the percentage of negative social media buzz surrounding the new program has spiked 150 percent.

TickerTags monitors social media sites to identify trends by searching for words and phrases that appear together in social media content, such as tweets.

Customers seem to have two major complaints about the new program on Twitter. First, the new program awards points based on the amount of dollars spent rather than the number of purchases, giving more points to big spenders. Second, customers have been complaining that rewards accumulated on the previous program are not translating into the new program, even after the company promised they would.

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The graph below shows that social media conversations that include the words “Starbucks” + “rewards” have spiked in recent month, but sentiment has become increasingly negative.

Starbucks is hoping that frustrations with the rewards program won’t be enough to keep customers away from its stores. After being one of the top-performing stocks on Wall Street in the past decade, Starbucks is up only 1.4 percent so far in 2016.

Disclosure: The author holds no position in the stocks mentioned.