Starbucks finally launched Starbucks Odyssey, which will be available later this year and marks the coffee group’s first foray into building with web3 technology. The new experience combines the company’s popular Starbucks Rewards loyalty program with an NFT platform, allowing customers to earn and spend digital assets that unlock exclusive experiences and rewards.
The company had previously teased its web3 plans to investors, stating that it expected this new experience to build on the current Starbucks Rewards model, in which customers earn “stars” that can be exchanged for perks such as free drinks. Starbucks Odyssey is envisioned as a way for its most loyal customers to earn a broader range of rewards while also building community.
Starbucks hired Adam Brotman, the architect of its Mobile Order & Pay system and the Starbucks app, to serve as a special advisor on the project. Brotman’s team worked on Starbucks Odyssey alongside the Seattle coffee chain’s own marketing, loyalty, and technology teams. He is now the co-founder of Forum3, a web3 loyalty startup.
Starbucks has been researching blockchain technologies for several years, but has only been involved in this project for about six months, according to Starbucks CMO Brady Brewer. He claims that the company wanted to invest in this area, but not as a “stunt” side project, as many do. Rather, it sought to find a way to use technology to improve its operations and expand its existing loyalty program.
It chose to make NFTs the passes that allow access to this digital community, but it is purposefully obscuring the nature of the technology underlying the experience in order to attract more consumers — including non-technical people — to the web3 platform.
“It’s built on blockchain and web3 technologies, but the customer — to be honest — may not even realise they’re interacting with blockchain technology.” “It’s just the enabler,” explains Brewer.
Starbucks Rewards members will log in to the web app using their existing loyalty program credentials to participate in the Starbucks Odyssey experience.
After this, they’ll be able to participate in a variety of activities, called “journeys” by Starbucks, such as playing interactive games or taking on challenges that aim to increase their knowledge of the Starbucks brand or coffee in general. Members can earn early digital collectibles in the form of NFTs as they complete these journeys (non-fungible tokens). Starbucks Odyssey, on the other hand, avoids the tech lingo and calls these NFT collectibles “journey stamps” instead.
In addition, a limited number of NFTs will be available for purchase through the Starbucks Odyessy web app, which is also available on mobile devices. Despite being hosted on the Polygon blockchain, these NFTs will be purchased with a credit or debit card — no crypto wallet is required. The company believes that by lowering the barrier to entry, this will make it easier for consumers to engage with the web3 experience. It will also not add “gas fees” to consumers’ transactions, preferring to offer a bundled price.
The company has not yet decided how much its NFTs will cost or how many will be available at launch, citing decisions that are still being made.
However, the various “stamps” (NFTs) will include a point value based on their rarity and can be bought or sold in the marketplace among Starbucks Odyessy members, with ownership secured on the blockchain. Starbucks and outside artists collaborated on the artwork for the NFTs, and a portion of the proceeds from the sale of the limited-edition collectibles will be donated to causes chosen by Starbucks employees and customers.
Members who collect stamps will earn points that can be used to unlock exclusive benefits.
While members can earn things like free coffee, free food, or select merchandise with a traditional Starbucks Rewards account and its “stars,” the points earned in Starbucks Odyessy will translate into experiences and other benefits.
On the low end, this could be a virtual espresso martini-making class or access to limited-edition merchandise and artist collaborations. As your points accumulate, you may be invited to special events hosted by Starbucks Reserve Roasteries, or you may even win a trip to the Starbucks Hacienda Alsacia coffee farm in Costa Rica. The most valuable perks are expected to be reserved for those who purchase NFTs, though lesser versions may be offered to those who work their way up.
For example, a paid NFT could provide the full travel package and farm tour, whereas an earned NFT could provide the tour only, leaving the user to book flights and hotels. However, no formal decisions have been made by Starbucks on this front.
However, the company can state that it intends to integrate the programme deeply with its existing loyalty rewards, going beyond simply using the same user account credentials for both programmes.
According to Brewer, Starbucks is already imagining how some of the activities that earn NFTs will be linked to real-world Starbucks purchases.
Users earn NFTs in Odyssey by completing challenges, which may include a real-world activity such as “try three things on the espresso menu,” which would require the user to show their barcode at checkout — just as they would if earning stars — to have their transaction counted towards the Starbuck Odyssey challenge. The company is still deciding on the mix of games, challenges, and quests that will be available at launch.
“However, we will have experiences that are directly related to customer behaviour in our stores,” Brewer stresses. Most importantly, the company wants to make acquiring NFTs accessible to everyone — not just those with a lot of money to spend on digital collectibles, as is frequently the case with current NFT communities, which exclude the average user.
“There will be a lot of ways for people to earn [rewards] without spending a lot of money,” Brewer says. “We want to make this as simple and accessible as possible.” Customers will be able to earn a variety of everyday experiences, such as virtual classes or access to limited edition merchandise. “The range of experiences will be quite broad and very accessible,” he continues.
Starbucks claims it researched all blockchain technologies for the project but decided on the “proof-of-stake” blockchain technology developed by Polygon for this effort because it uses less energy than first-generation “proof-of-work” blockchains, which is more in line with its conversation goals.
The decision to enter the web3 world makes sense for a company known for investing heavily on emerging technologies and making them more approachable and accessible to consumers. Starbucks previously installed Wi-Fi in its stores to encourage customers to spend more time there. It also promoted the concept of mobile wallets long before Apple Pay became popular. And it established mobile ordering as the norm well before the Covid pandemic, when other restaurant chains adopted it.
However, one criticism levelled at many traditional businesses when they enter the web3 market is that they treat it as a marketing stunt rather than a real endeavour. Starbucks, of course, claims that this is not the case — but only time will tell how serious its interest is.
“We’re optimistic about the future of these technologies enabling previously unimaginable experiences,” says Brewer. He explains that the goal is to be adaptable and move with the customers as the web3 market evolves. “It’s critical that we think about it in the long term,” he adds. “But, given that we’re integrating it into our industry-leading, massive scale rewards programme,” he says, “we’re committed.”
According to the company, its web3 platform will open its waitlist (waitlist.starbucks.com) on September 12 and launch later that year. It plans to remove the waitlist and make the platform more widely available sometime next year.