Starbucks buys first farm, plans to double loyalty card members

Starbucks Corp., already on a tear buying tea, juice and bakery companies, just snapped up its first coffee farm and is planning to double the number of people signed up for its loyalty programs.

The company is expanding its roughly 3-year-old My Starbucks Rewards program, allowing customers who buy Starbucks’ packaged coffee in grocery stores to earn points that can be redeemed for free treats in the chain’s cafes.

The Seattle giant, presenting at its annual investor meeting Wednesday, is calling the offering the “first cross-channel, multi-brand loyalty program” ever. The initial perk will be available in May, then expanded this fall to other Starbucks supermarket products.

And in April, patrons who buy from Teavana – a tea-focused chain Starbucks acquired in November – will be able to earn Starbucks points if they use the company’s loyalty card or mobile app. 

Starbucks predicted that such incentives will cause membership in the chain’s loyalty program to double to 9 million people by the end of fiscal year 2013 from 4.5 million participants in October. The program already adds some 80,000 new members a week, according to Starbucks.

Starbucks predicts that the mall-based tea chain Teavana will eventually boom to at least 1,000 stores nationwide from 300 locations now. La Boulange, a bakery business Starbucks picked up last year, is projected to have products in 2,500 stores this year, up from the 400 San Francisco-area cafes that currently carry its goods.

Starbucks also expects Evolution Fresh, the juice brand it took over in 2011, to double its presence to 8,000 locations by the end of the year.

Continuing its buying spree, Starbucks said this week that it bought its first coffee farm – a 600-acre property in Costa Rica, where it plans to develop new types of coffee and test defenses against botanical diseases.

Starbucks also said during its investor meeting that it will pair with American Pioneer Manufacturing, a facility in Ohio, to begin producing a made-in-the-USA mug this fall. Some 100,000 of the ceramic cups will arrive in stores in the winter.

Over the next five years, Starbucks plans to open some 3,000 new stores in the Americas, with more than half of them in the U.S. By 2014, China will become the second-largest market for Starbucks behind the U.S.

And Chief Executive Howard Schultz didn’t rule out that someday, China will become the company’s top demographic.

Starbucks stock was trading slightly up in afternoon trading in New York, rising less than a percent, or 26 cents, to $57.09 a share during the investor conference.


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