Starbucks has finally launched a beta version of its metaverse — the Starbucks Odyssey — on Dec. 8 after initially announcing the Web3 experience in September. Although restaurants have been dipping their toes and marketing budgets into the metaverse all year, it feels like the party is just getting started now that one of the biggest foodservice companies in the world has joined in.
But make no mistake: the metaverse space is still the Wild West of the Internet 3.0, and likely will be for a long time to come. At this point, we’re still defining and refining exactly what the metaverse is. The first retail and foodservice brands to join the trend required both a compatible virtual reality headset, as well as knowledge and ownership of cryptocurrency. To play basketball with the Wendy’s Baconator in the Wendyverse, for example, you have to own a Meta Quest 2 headset.
This is why we think Starbucks was smart to wait more than a half a year after some of its industry colleagues to join the fray. Rather than limit the size of its potential audience by requiring extra equipment or an understanding of Bitcoin and NFTs, Starbucks has broadened its potential userbase. NFTs have been rebranded as “Journey Stamps” and cryptocurrency is not required to purchase and trade them. The coffee chain also has borrowed from the familiar structure of a rewards program by allowing customers to rack up points as they purchase and trade NFTs. Points can then be redeemed for in-store experiences.
Even though Starbucks has stayed quiet on some of the details of how the Odyssey experience and rewards will work, the examples they give have nothing to do with traditional rewards of discounts and free drinks. Instead, Starbucks is offering more experiential prizes through participation in the metaverse, like espresso-martini making classes and access to exclusive merchandise and in-store events. As we have previously reported, loyalty programs are shifting toward exclusive experiences instead of discounts, and the metaverse has become a new virtual playground to experiment with this shift in digital loyalty.
But the metaverse is still a risky investment, and many restaurant operators have shrugged it off as a fad that won’t last. While we agree that the future of the metaverse is uncertain, companies like Starbucks must figure out how to create long-term engagement via blockchain. This means figuring out how to connect the virtual world with real-life rewards instead of just relying on Flash-like games, which can be a fun one-off marketing tool, but likely won’t entice consumers for longer than a few minutes (sorry Chipotle and Wendy’s).
So, what do Starbucks customers want from a metaverse experience? In the latest press release, Starbucks has said that there will be three levels of benefits (reminiscent of their old, tiered rewards program structure), with the top rewards including possible trips to Starbucks Hacienda Alsacia coffee farm in Costa Rica. Obviously, a coffee-themed trip to Costa Rica would likely appeal only to a small subset of Starbucks superfans, and the majority of customers would be playing around within the first tiers of rewards.
Ideally, the Starbucks Odyssey experience would eventually be as natural to sign up for as their robust rewards program, and we think could one day could even replace Starbucks Rewards. But Starbucks just needs to remember that what the average everyday customer wants is not exclusive classes or fancy vacations to coffee farms: they want their everyday coffee and seasonal treats to be made and ordered quickly and efficiently. Perhaps a “skip the line” NFT or a “try the new Frappuccino a week before everyone else” NFT would be wise to add to the Starbucks Odyssey experience.
One thing is for certain—all operator eyes are on Starbucks as they figure out how to make the metaverse work for this new era of digital customer engagement. Starbucks Odyssey will officially launch to the public in early 2023.
Contact Joanna at [email protected]