Matt Ryan Gerri Martin- executive vice president ...

Matt Ryan

executive vice president, global chief strategy officer

Gerri MartinFlickinger

chief technology officer

Drivers of growth

PARTNERS

PRODUCTS

STORE PORTFOLIOS

DIGITAL

Components of Starbucks Digital Flywheel

Rewards

The most compelling rewards program with

everyday relevance

Payment

The easiest, most sensible ways to pay at Starbucks

and beyond

STARBUCKS DIGITAL

FLYWHEEL

Personalization

Offers, communications and service tailored to individual customers

Ordering

The fastest, and most convenient way to order

Growth of the Starbucks Digital Flywheel

% OF U.S. COMPANY OPERATED SALES 40%

30%

20%

10%

0%

FY13

FY16

# OF ACTIVE U.S. STARBUCKS REWARDS MEMBERS

NON-STARBUCKS REWARDS CARD SPEND

PHYSICAL CARD STARBUCKS REWARDS SPEND

NON-MOBILE ORDER & PAY MOBILE PAYMENT

MOBILE ORDER & PAY

5M

Q1 FY13

12M

Q4 FY16

Opportunity for much more growth via digital

CURRENT CUSTOMERS

DIGITAL FLYWHEEL U.S. CUSTOMERS PAST 30 DAYS, AS OF OCTOBER 2016

2.5M MOBILE ORDER

& PAY MEMBERS

1/3 MOBILE PAYING CUSTOMERS

MOBILE PAYING MEMBERS

8M 2/3 MOBILE PAYING CUSTOMERS

12M STARBUCKS REWARDS ACTIVE MEMBERS

1/6 ALL CUSTOMERS

75M ALL CUSTOMERS

TOTAL ADDRESSABLE

~150M AWAY FROM HOME

COFFEE/TEA MARKET

Incrementality by customer type

NUMBER OF ACTIVE U.S. MEMBERS BY SPEND LEVEL (%)

100%

HIGH-SPEND

HIGH-SPEND

SPEND LIFT AFTER JOINING REWARDS

>20%

MEDIUM-SPEND

MEDIUM-SPEND

>30%

LOWER-SPEND MEMBERS

FY13

LOWER-SPEND MEMBERS

FY16

>70%

Source: 2016 Argus Credit / Debit card analysis

Focus on driving acquisition and activation

Opportunity in increasing awareness

Making sign-up available in store

~60%

CURRENT AWARENESS

In-store REGISTRATION

Real-time actions to drive adding balance and first transaction

Dynamic & actionable

ON-BOARDING

40%

OPPORTUNITY

Benefits of a spend based program

Customers

Fairer based on spend Rewards for bigger purchases

Starbucks

Encourages transaction AND ticket Enables "Stars Everywhere" partnerships Creates greater marketing flexibility Stopped transaction splitting

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