Mar 21, 2024

Starbucks announced that it is sunsetting Odyssey, the 18-month experiment that uses collectible non-fungible tokens as the anchor of a loyalty program.

Video transcript

Is Starbucks Odyssey a failure. Technically, yes, the coffee giant said that they're going to be shutting down the NFT Powered loyalty program at the end of this month. But is it a failure of Web three? Let's get into it. Starbucks was a first mover when it came to a big brand, launching an NFT project in 2022. You might remember Starbucks launched this new experience that would offer Starbucks rewards members and Starbucks employees in the United States the opportunity to earn and purchase digital collectibles that would unlock all kinds of benefits and immersive experiences for users. Now, at the time, this made complete sense to me and here's why my sister is an avid Starbucks paraphernalia collector. She has all the cups from different countries. She even convinced me to get the Christmas Cup last year, which is sitting in my cupboard collecting dust. Now that is neither here nor there. My sister is an example of just how loyal Starbucks customers are. They don't just buy the coffee and delicious desserts. They collect the stars, they buy the seasonal merchandise, they visit the ship stores and if they're on vacation in Costa Rica they might even visit the Starbucks coffee farm and I'm willing to bet that some folks might plan their vacation around that experience. So, with all of these loyal fans, why is the program shutting down? My opinion here is that this is a failure of marketing the project. Now, outside of Web three media, there was nothing telling me about how to participate in the Odyssey program. Maybe I'm not a big enough fan. So don't come for me. But when I went to Starbucks stores, no one talked about this program, there was no marketing material and the program wasn't prominent in my app. I don't know a single person who was excited about this program, but I do know a lot of people who were and who still are excited about Starbucks collectibles and collecting stars this week. Coin desk reporter Danny Nelson uncovered that Polygon labs paid $4 million to the coffee company to build and host this NFT project. Let me say that again. Polygon paid Starbucks $4 million to build and host this program. Now, if you're thinking, don't companies usually pay the tech provider for their services to build products like this. Yes, that's usually how it happens. But in this case, it seems like when it comes to bringing big trusted brands into web three crypto native companies were willing to dish out. Now, you'll remember Polygon announcing other big brand partnerships like Nike. I wonder if they paid for that. And if so, what's the price tag associated with bringing Nike to Web three A source also told Danny that the company is now more focused on building tech instead of inking these big partnerships. But I think the two go hand in hand, if you build it, will they come or do you need big trusted brands who are willing to put the market dollars and brain power behind the product for it to be successful. It's unclear because in my experience, Starbucks didn't market Odyssey to the best of their ability. And maybe this isn't a failure of NFT based loyalty programs. Maybe there will be successes in the future. But did Starbucks put their best foot forward in letting their loyal audience and customers know how Starbucks stamps would help them level up in their Starbucks world? I don't think so. I should note that Danny notes in his story, the deal with Polygon wasn't likely only a money play and Starbucks was genuinely interested in finding a web three partner for their Odyssey experiment. The takeaway here, it's not as easy as it sounds to strip away technical language like NFTS from marketing material, especially when the whole team is excited about using a new technology. And it can be difficult to take your existing story, the one your audience fell in love with and create the next web three iteration of that same story without making it sound overwhelming and complicated. People like things that are easy, fun and convenient. And brands need to put the work into making their products easy, fun and convenient loyalty programs have become so popular because they offer discounts free stuff, exclusive experiences and NFTS enhance this by bringing digital identity and ownership to the table. Anyone who's following the space I think understands that loyal fans can connect more closely to the brands they love. And on the other hand, brands can more effectively engage with and reward their audience right through the NFTS. I'm gonna leave you with this quote from CEO and co-founder of Co create Tara Fung from a coin desk feature. She said, quote, the value that Web three brings as part of the tech stack is that it introduces a greater degree of ownership of someone's loyalty and quote she added though that there's a delicate balance between providing services to web three natives or people who already understand Web three and turning off potential new users. So while Starbucks couldn't figure it out. NFT loyalty isn't dead. Unfortunately, Starbucks Odyssey is.

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