Free Wi-Fi (and Brand Relevance) at Starbucks

Starbucks made news earlier this summer when it began offering free Wi-Fi access to customers. At first glance this decision would seem to create an unintended outcome of some customers hanging out for extended periods of time, preventing turnover in seats that could actually result in potential customers walking away. But, further examination of Starbucks’ plans show this move goes beyond giving away Wi-Fi access to lure customers into its stores.

A new offering to be launched this fall, the Starbucks Digital Network (SDN), will feature premium content aggregated for Starbucks’ customers that can be accessed for free. Paid versions of sites like The Wall Street Journal and The New York Times are two SDN partners. Among other content providers are Apple and magazine publisher Rodale. Content will be organized into five channels: News, Entertainment, Wellness, Business & Careers, and My Neighborhood. Starbucks and the content providers will look to create up-selling opportunities on SDN that will be a revenue sharing venture between Starbucks and its partners.

The brand that set new standards for creating a great customer experience continues to innovate. Starbucks will always have as its main focus delivering great coffee, but it is not the coffee alone that brings customers to Starbucks. Drinking coffee while relaxing, working, or surfing the Internet is an escape for many people. Enhancing time spent at Starbucks by building a custom network of information valued by customers can lead to greater brand loyalty to Starbucks… and its content partners. This loyalty translates into more visits to Starbucks. Ideally, customers will purchase more items and do it more frequently, to the point that Starbucks is not a choice (“Should I go to Starbucks, Dunkin Donuts, or McDonald’s?”) but part of customers’ lifestyles.

Weaving brands into customers’ lives in this way is a powerful strategy for building customer loyalty. To reach this destination, a price for loyalty must be paid. It is not bought with frequent promotions or low prices, but with relevance to the consumer.

Yahoo News - "How Starbucks Plans to Capitalize on Free Wi-Fi"

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