Starbucks is reintroducing loyalty program levels

Starbucks It is reintroducing tiers to its North American loyalty program in a bid to encourage coffee drinkers to visit more frequently as part of its broader transformation strategy.

The company made the announcement Thursday at its Investor Day. Executives across the company are sharing more details about the company’s plans to drive future sales growth and profitability, including through its all-important loyalty program.

Starbucks Rewards has been around since 2009. The company, long viewed as a leader in restaurant technology, relies on its loyalty program to encourage members to visit more frequently and spend more money. In fiscal 2025, transactions associated with the rewards program accounted for 60% of the company’s revenue.

But the coffee shop chain also has to balance offering attractive rewards to members and maintaining profit margins. In 2019, the company scrapped the two-tier system, saying the change was intended to encourage new members to become more engaged. The company now feels the system is not adequately rewarding its most loyal customers.

“Our best customers come in 200 times a year, and we were treating them like someone who came in once a year,” Starbucks chief brand officer Tracy Lieberman, who joined the company in November 2024, told CNBC’s Kate Rogers. “So we introduced the levels.”

The tiered program will return on March 10, this time with three levels.

Starbucks Rewards members with fewer than 500 “stars” — or points — will belong to the green tier. They can enjoy a free drink or food on their birthday, get early access to select menu items and receive personalized offers. Green Tier members’ stars will not expire for six months, and they can prevent them from expiring in several ways, such as redeeming a reward or making a purchase.

Once a customer earns 500 stars over a 12-month period, Starbucks upgrades them to Gold. Their points never expire, and they earn 1.2 stars for every dollar they spend.

Members can move up to a reservation level after earning 2,500 stars over a 12-month period. Customers at this level get access to exclusive merchandise and events, and earn 1.7 points for every dollar they spend.

The current Starbucks Rewards program awards members two stars per dollar spent when they pay with a pre-loaded Starbucks gift card. If they pay using a credit or debit card, members will only receive one star for every dollar spent.

The rewards available for redemption remain largely the same, although Starbucks is adding the option of $2 off any order for 60 stars.

The company is also adding “Free Mod Mondays,” which gives loyalty program members a free mod of any drink on a specified Monday, once a month.

This announcement comes on the heels of the company releasing its earnings report on Wednesday morning. For the first time in nearly four years, Starbucks saw growth in traffic from both rewards program members and non-members during the quarter.

“You have to win over your rewards program customers and — call it — the light or infrequent customer,” CEO Brian Nicol said on the company’s earnings call Wednesday.