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Steel This Starbucks Card, Part Two


Editor’s Note: This article is an excerpt from one of RetailWire’s recent online discussions. Each business morning on RetailWire, retail industry executives get plugged in to the latest news and issues with key insights from a panel of retail industry experts.

When Starbucks introduced its limited edition stainless steel Metal Card in 2012 at a price of $450, I was among the few (15%) on RetailWire who thought the company would not sell the 5,000 the coffee chain offered for sale on Gilt.com. I was wrong.

This year, the coffee chain is back with card at the same price ($400 is loaded onto the card for purchases), but Starbucks is making it even harder to get them. As was the case last year, you can’t buy the card in a Starbucks or on the company’s site. You’ll have to go to Gilt.com (www.gilt.com/starbucksrose) at noon EST today and order one of only 1,000 being sold.

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Last year, according to Starbucks, it took about six minutes for 5,000 cards to be sold. With only 1,000 available this year, that timeframe should be cut substantially.

According to the coffee company, roughly 10% of adults in the U.S. received a Starbucks gift card last December. Cliff Burrows, Group President of the Americas, Europe, the Middle East and Africa for Starbucks, told USA Today that the company’s cards are the most “gifted” item in the country. By making the Metal Card even harder to get, demand may actually intensify.

“If something is hard to get, it takes on irrational value,” Steven Addis, a brand consultant, told USA Today. “By making it even harder to get, the irrationality goes up.”

The Metal Card bestows upon its holder Gold Level status, including free refills and other perks. Each hand-assembled card, according to Starbucks, “features a gorgeous artisan rose base metal with rose colored coating, laser-etched with traditional Starbucks lettering.”

Scarcity Helps Spur Success For Starbucks

In the comments following the article, retail consultants and executives shared their opinions around whether the Starbucks Metal Card will drive the same results as it did in 2012.

Debbie Hauss, Editor-In-Chief of Retail TouchPoints, helped kick off the conversation, noting that the scarcity tactic is very effective for certain companies and products. “It reminds me of times in the past when I had to search for a certain child’s toy during the holiday season. And how about some of the recent iPhone launches? A certain percentage of the consumer population always will want something that is exclusive to a small percentage of shoppers. I don’t think it will work for every brand, but Starbucks has surprised some by proving it works for theirs.”

Other discussion participants also noted that Starbucks’ focus on exclusivity will help create a sense of urgency among consumers. 

“The Starbucks aura…creates the illusion that being a special member in the Starbucks fraternity is a badge of superiority,” said Gene Hoffman, President and CEO of Corporate Strategies International. “I say ‘humbug’ — but it works.”

Hoffman added that more marketers will try to duplicate this experience, and execute campaigns that boost confidence and promote a specific lifestyle or status.

Although many industry sources are questioning the financial impact of the Starbucks Metal Cards, others are noting that this is more a marketing play than sale driver.

“I’m not sure there is much of a market for a $450 Starbucks card,” noted Robert DiPietro, GVP Product Strategy and Business Development at Affinion Group. “It’s more of a marketing ploy and collectors’ item. I think scarcity drives marketing attention and PR for some items, but really isn’t much a driver for sales.”

Another participant also noted that this venture and ongoing partnership will be valuable in the long term for Gilt, providing a great promotional advantage to the high-end flash sale company.

“Gilt has more to gain from offering the Metal Starbucks Card than Starbucks,” said Joan Treistman, President of The Treistman Group, LLC. “Purchasers who have wherewithal to invest in this card will have to do so at the Gilt site and who knows what else they will learn and desire regarding the luxury products offered by Gilt.” 

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