Best Buy, Dunkin’ Donuts and Starbucks have changed their rewards programs. Then came the setback

If you wish to earn Rewards points with Best Buy, you must purchase a Best Buy credit card in order to redeem them.

Some customers hate the idea.

The company’s free “My Best Buy” program has for years offered members points on purchases that they can earn toward cash rewards and other perks such as exclusive savings and services.

However, starting next month, reward points will only be available to customers who have a Best Buy credit card. (Customers with reward points who do not wish to apply for the card will receive a certificate to redeem any remaining points.)

At the same time, Best Buy has tried to sweeten its benefits program by offering members free shipping on all orders – no minimum purchase required. Previously, Best Buy had a $35 minimum to qualify for free shipping.

Offering free rewards can be expensive for companies, and they try to control costs in times of high inflation. More and more brands have redesigned their loyalty programs during the pandemic to cope with rising advertising and technology costs, as well as credit card liabilities.

Best Buy’s changes were intended to give customers a free alternative to Amazon Prime and Walmart+, both paid membership plans, and also to persuade them to switch to its branded credit card. About 25% of Best Buy’s sales are made with one of its credit cards, and research shows that customers with business credit cards spend more money than customers without one.

However, some customers were more frustrated with the end of rewards points for non-Best Buy credit cardholders than with the free shipping.

Customers on Twitter and Reddit criticized the changes to the points system, saying they didn’t want to be forced to take another credit card to earn rewards. Some said they plan to stop shopping at Best Buy because of the changes.

“I’m not sure @BestBuy is even worth it now,” one user on Twitter wrote on Thursday. “Can get free shipping from many locations that don’t require a branded credit card to receive rewards.”

Another user sent on Twitter: “It’s a VERY bad idea to stop offering reward points unless you have a Best Buy credit card. Sometimes that’s the only reason I shop at Best Buy rather than Amazon or Walmart.”

Best Buy did not comment on the customer reaction.

It’s unusual for companies to end rewards for customers without a credit card, said Yuping Liu-Thompkins, a marketing professor at Old Dominion University and director of the Loyalty Sciences Lab. She wasn’t sure if the free shipping would be enough to offset customer anger at the redesign.

It was another example of the pitfalls of companies changing customer rewards programs.

Rewards programs are a key tool for businesses to engage customers, learn about their preferences and foster brand loyalty. But while rewards members like freebies and other perks, they’re just as quick to criticize companies for any tweaks.

Reaction to Best Buy’s move mirrored customer backlash after changes to Dunkin’ and Starbucks rewards programs last year.

Both chains raised the threshold for earning rewards. Part of what Liu-Thompkins said was a larger trend of companies devaluing points, miles and other benefits to combat higher costs.

Dunkin’ announced in October that it was replacing its old rewards program, DD Perks, with a new program called Dunkin’ Rewards.

The new system brought a number of changes. Members need 700 points to get a free coffee and 900 points to get a frozen beverage or a hot or iced signature latte. With DD Perks, members without these restrictions could get a free drink for just 200 points.

“Please keep DD Perks – it’s a million times better”, one person wrote on Twitter, adding, “Why do you have to try and fix things that aren’t broke???” Another said, “I hate the new Dunkin’ Rewards,” adding a cry face emoji.

Starbucks also said in December that this was the case make changes to its rewards program, which requires members to spend more to earn some popular freebies like coffee and baked goods.

Some customers protested the changes, which will come into effect next month.

“Didn’t you see the backlash Dunkin got when they changed their schedule a few months ago,” said one TikTok user sent.

Mary Pilecki, the leads Loyalty Marketing Research at Forrester said changing loyalty programs carries risks and brands will lose some customers.

But loyalty program changes aren’t usually fatal for brands and are just one factor of dozens that go into customers’ purchasing decisions, she said.

Her research shows that the biggest consumer reaction occurs in the first month or two after announcing a change of company. After that it decreases significantly.

CNN’s Danielle Wiener-Bronner contributed to this article. The CNN wire™ & © 2023 Cable News Network, Inc., a Warner Bros. Discovery company. All rights reserved. Best Buy, Dunkin’ Donuts and Starbucks have changed their rewards programs. Then came the setback

Laura Coffey

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