PPB May 2016

FAST

FORWARD

56 •

PPB

• MAY 2016

THINK

MARKET SHARE

Hey, Big

Spender

WHEN STARBUCKS FIRST BEGAN ITS

rewards pro-

gram, it wasn’t about how much money you spent,

but how often you spent it. But no more—the national

coffee chain has changed its My Starbucks Rewards

program to reward points based on the amount of

money customers shell out for their pumpkin spice

lattes rather than the number of times they come in for a fix.

Executives for the company say the change is in response to

consumer demands that they receive more for their money—

more stars, anyway. Under the old program, one visit earned one

star—12 stars earned customers a free food or drink item. Now

spending $1 earns two stars—but it also now takes 125 stars, or

$62.50, to get that free coffee.

The negative backlash has already spurred Starbucks to make

a modification to its new program, supplying additional incen-

tives for “Gold” members such as the opportunity to earn dou-

ble stars one day each month.

Whether they spend a little or a lot, the customers who par-

ticipate in the program spend three times as much as nonmem-

bers, according to the company. Starbucks boasted 11.1 million

program members in the U.S. in January, up 23 percent from the

previous year.

AD-ITIVES

ADMIT IT. SEEING FACEBOOK

ads

for a product mere minutes

after you searched for that very

same item on Amazon is a little

creepy. Digital ad framework

SilverPush, based in India,

increased the creep factor expo-

nentially by collecting detailed

data from users of certain mobile

apps—and now the Federal Trade

Commission is speaking up.

Like many other data collec-

tion programs, SilverPush helps

its ad partners track what con-

sumers are searching for online.

Unlike most programs, though,

SilverPush has employed unique

audio beacons, or UABs, to sig-

nal any nearby devices, including

TVs, when a consumer looks at a

product its ad partners might

sell—a process called cross-

device tracking.

The trouble, the FTC and

other critics found, is that the data

collected from consumer devices

goes far beyond shopping habits.

Information such as device ID

numbers, WiFi router addresses,

and even phone numbers have

been collected by SilverPush.

The FTC is now urging app

developers who partner with

SilverPush to tell their customers

that the company collects and

sells third-party data. SilverPush

responded to the FTC

announcement by issuing a state-

ment that it has dropped the

UAB technology and has no

active partnerships with U.S.-

based app developers.

Are Your Apps

Spying On You?

PHOTO BY NORGAL/SHUTTERSTOCK