Living Social & Starbucks Team Up to Sell Half-Price Giftcards
Starbucks, the well-known coffee retailer chain, has teamed up with the coupon website Living Social, in order to offer half-price Starbucks gift cards. The Groupon rival, who offers daily deals through their website LivingSocial.com, has been chosen by the world's largest premium coffee chain to offer $10 Starbucks gift cards for $5. This offer will only be available Wednesday, September 5th and can be used anywhere in the United States, up to six months after purchase.
This is a terrific deal, for anyone who gets their coffee from Starbucks, especially if they allow you to buy more than one. However, since most coffee products at Starbucks are $6 to $7, one gift card isn't going to stretch very far.
If you are a Starbucks rewards program member, you likely already know about the offer, as emails went out to those members Tuesday night, giving them the first chance to purchase the gift card. The company will sell at least a million of these half-price gift cards, company executives said. This could certainly help to seal the deal in the war between Groupon and LivingSocial. Groupon shares have not done well since they had their first IPO last year. Stock prices were $4 on Tuesday, at at 4.28 on Wednesday afternoon.
This is the first time that the coffee chain has worked with LivingSocial, but they offered a similar deal with Google Offers a few months ago. However, Chief Digital Officer for Starbucks, Adam Brotman, said that daily deals still work. "The type of deal, the type of merchant and the implementation of offers are going to be different from circumstance to circumstance."
Why they chose to go with Living Social this time around is a mystery, but according to Brotman, it wasn't personal. "This was a great opportunity to work with LivingSocial," Brotman said. "It wasn't about anybody else in the space." This may be a nice way of answering questions about their choice, but it is likely that neither Groupon nor Google Offers could offer (or did offer) Starbucks the kind of sales that they wanted for this gift card offer.
LivingSocial Offers $10 for $5 Starbucks Deal as Groupon Slides
Starbucks gave a nod to LivingSocial Tuesday, deciding to use the daily deal service to offer a pay $5, get a $10 gift certificate deal. The LivingSocial deal was offered to rewards members, via email, on Tuesday night and went live for everyone else Wednesday. This marks the first time that Starbucks has partnered with LivingSocial to offer a nationwide deal. According to LivingSocial’s deal page, customers will have 6 months to redeem the Starbucks card.
Both companies said they expect to sell 1 million deals. With 10 hours left on the promotion, 749,689 cards have already been purchased.
Starbucks’ partnership with LivingSocial is widely seen as a shot at Groupon, the world’s larget daily deals company. Groupon’s stock, as well as its popularity, have plummeted since it’s IPO last year. The stock hit a record low of $4 on Tuesday.
Adding salt to Goupon’s wound is the fact that Starbucks CEO Howard Schultz served on the the deal site’s board of directors, though he stepped down in May.
Starbucks’ Chief Digital Officer Adam Brotman said that the partnership was proof that, regardless of Groupon’s struggles, daily deals do still work for certain businesses. Why the company chose to join forces with LivingSocial instead of Groupon is unclear, however.
“It wasn’t about anybody else in the space,” Brotman told Reuters.
That said, Starbucks offered a similar deal through Google Offers, the similar business owned by Google Inc.
Unexplainable business practice or not, this is a great deal for any and all coffee drinkers out there. If you’re a ‘grande blonde roast’ drinker like myself, you’re getting twice the pick-me-up for half the price. If you’re an orange mocha frappuccino drinker, however, a single gift card won’t take you very far. But hey, money saved is better than money spent.
Are you going to take advantage of the spend $5, get $10 deal?
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