3.2.1 MyCup

Solution

Bring us your stained, your dirty, your commuter cup. 

We�ll give you a clean one and fill it up. 

3.2.1 MyCup 

A new service brought to you by Starbucks Coffee.

 

Offering.

Purchase a weekly subscription at one of three service levels: 3 size cups a week, 2 cups a week, or 1 cup a week.  At each level you will be given one non-disposable cup.  Each time you come in you will check-in your current �dirty� cup and check-out a new clean cup filled with your coffee or beverage of choice. You can check your cup-in at any Starbucks.  You are limited to the number of exchanges and cups of coffee at which your subscription service allows.

 

Service Levels.

               3 cups a week: $ 4.50

               2 cups a week: $3.00

               1 cup a week: $1.50 

 

FAQS.

-  What happens to my unused cups?  A: Each week's "unused" cups will be banked and can be used in subsequent weeks. 

-  What if I don't want coffee?  A: Other drinks can be purchased at retail cost, less $1.50.

-  What if I lose the cup?  A: One replacement cup will be provided at an additional cost.

-  What if I want to cancel?  A: You can cancel at any time.  Your subscription will end at the end on the following Sunday.  You keep the cup.

 

Background of Program.

3.2.1 MyCup changes coffee from a consumable product to a service. It focuses on changing behavior rather than the depending on a new technology that also comes with higher risk, greater investment, and greater product testing. This program can be rolled out and tested in select markets now, only requiring minimal software updates to the software of the register. 

 

The MyCup program targets the high value, high frequency customer.  Likely Starbucks is able to segment their customer based upon frequency.  These high frequncy customers have in turn a high disposable cup useage.  By changing their behavior Starbucks would see the largest decrease in disposable cups per customer relative to the average customer. 

 

Reduce Waste.

Below is an example of the benefits in terms of paper cup reduction.

 

Assume Starbucks customer base is distributed into three frequency segments

-  20% of the customer base purchases coffee 3 times a week, at this rate they account for

-  30% of the customer base purchases coffee 2 times a week.

-  50% of the customer base purchases coffee 1 time a week.

 

Starbucks goal is to have 25% of beverage purchases be provided in re-useable cups, or approximately .  To achieve this with the 3.2.1 MyCup program, Starbucks would need to only convert 12% of the 3 times a week coffee consumer and 12% of the 2 times a week coffee consumer and 15% of the 1 time a week coffee consumer.  If the conversion goals are achieved by MyCup Starbucks would be able to reduce their disposable cup usage by 500 million, from nearly 2 billion to 1.5 billion annually. 

 

Obviously these market segments are made up of fictional data.  The segments would be priced on real data and priced to be competitive with current retail prices. 

 

Resources Required.

The program is very close to implementable.  It is about changing customer behavior rather than

-  The software the register uses would need to be able to accommodate individual accounts and track cup �check-in� and �check-out.�

-  Individual bar-code identifiers will be required to track each MyCup member.  The existing Gold Card program could be used.

-  An increase in labor, energy, and water may be required to wash the cups.

 

New or Existing Capabilities.

The idea focuses on changing behavior, not product.  It changes coffee to a service industry rather than a consumable and borrows from existing service centered business models, like Netflix and wireless phone services. 

 

The Whole Experience.

MyCup not only makes environmental sense, but most importantly makes sense within the context of a customer�s life.  No longer will the commuter mug sit in the car or the coffee cup on the desk waiting to be washed.  Rather we will wash your cup and give you a fresh cup of coffee in a clean re-useable cup at any Starbucks. In the morning, check-in your dirty cup from the previous day at the Starbucks near your home.  Then check-in your morning cup at your Starbucks near work or hold onto it and check it in the next morning.  It�s up to you, except for the washing.  We�ll do that.