Out of curiosity, the author mentions a possible alliance with another companies (McDonald for example) that would share savings, breakage, and data.
Anyone would know if this kind of idea is behind or maybe related to Facebook Libra?
Starbucks, monetary superpower
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Re: Starbucks, monetary superpower
#22The best way to go about this is to use your credit card to reload your starbucks balance, get points on the card and from the starbucks purchase.
Relatedly they've tried to sell me on the starbucks credit card but it's a 1-2% difference in rewards. (nto that I spend quite enough on coffee for it to come out to much, but it's the theory of it that's fun)
Re: Starbucks, monetary superpower
#23One use of Starbucks gift cards not mentioned in the article: cashing out foreign currency.
"When you’re leaving a foreign country and still have some of the local currency, take it to a Starbucks and load it onto a gift card. You can use the card later in the UK, USA, Canada, Australia, Mexico, and the Republic of Ireland."
https://lifehacker.com/put-leftover-foreign-currency-on-a-st...
Re: Starbucks, monetary superpower
#24The magic trick here is that Starbucks Rewards -- their "free" loyalty program -- requires using a Starbucks Card (virtual or physical) in order to make your purchases. Under the old system (prior to ~Apr 2019) you had to make $150 in purchases annually to get "Gold" status, and then you got a free reward after every ~$62.50 in Starbucks spending. The new program has no minimum, and tiered rewards between $12.50 and…
That's important, but it's not really the core of why the Starbucks Card program is so huge.
I worked on the team around 2009, before the rewards program rolled out. The card program was already huge at that point, so the rewards are not the primary draw.
Re: Starbucks, monetary superpower
#25These and amazon gift cards are indeed a medium of exchange.
They can also be used for money laundering, as a result.
I always assume when I see products listed on AMZN with bizarrely inflated prices that someone is fast-tracking that, for example[1].
1: https://www.theguardian.com/books/2018/apr/27/fake-books-sol...
Re: Starbucks, monetary superpower
#26Not so sure it's due to "coffee addicts" so much as the fact that Starbucks gift cards became the perfect, generic, gift. How many times have you been on your way to X, needed to bring a gift, and just run into Walgreens?
the default setting on the starbucks app on my phone is to automatically top up every time the balance drops below $10. So starbucks basically has a permanent $10 loan from me. I'm sure i'm not the only one. actual gift cards given as gifts though are probably more likely to be used up and discarded, instead of being set to auto-reload and carry a balance.
That made me delete the app and avoid Starbucks. I was more than willing to pay with a cc, but they wanted me to give them an interest free loan?
Re: Starbucks, monetary superpower
#27These and amazon gift cards are indeed a medium of exchange.
They can also be used for money laundering, as a result.
How would you launder money with starbucks cards? Sure, you can transfer balances with them, but that alone doesn't help you launder money.
According to the treasury dept:
>First, the illegitimate funds are furtively introduced into the legitimate financial system. Then, the money is moved around to create confusion, sometimes by wiring or transferring through numerous accounts. Finally, it is integrated into the financial system through additional transactions until the "dirty money" appears "clean".
I don't see how starbucks cards can be used in any of those steps.
Re: Starbucks, monetary superpower
#28> But the only way to cash out of Starbucks balances is to buy a coffee--a promise that Starbucks can always keep!
By the way this isn't true in California: by law all stored value and store-credit cards last for 10 years and can be cashed out.
Re: Starbucks, monetary superpower
#29One use of Starbucks gift cards not mentioned in the article: cashing out foreign currency. "When you’re leaving a foreign country and still have some of the local currency, take it to a Starbucks and load it onto a gift card. You can use the card later in the UK, USA, Canada, Australia, Mexico, and the Republic of Ireland." https://lifehacker.com/put-leftover-foreign-currency-on-a-st...
Useful tip, thanks! Related is sending Amazon gift cards from the Amazon of their country to people who live in a different country, so that you can effectively send cash without actually sending cash or requiring the receiver to sign up for Paypal etc. The only gotcha is you have to do it using the flavor of Amazon that is the receiver's Amazon, but since Amazon ports your user account and payment information between different Amazons and lets you use your native currency to buy Amazon cards in a different currency, it works.
Re: Starbucks, monetary superpower
#3015 or so years ago, my manager at WalMart Stores Information Systems Division was previously a programmer on one of the many finance related teams. Specifically, she worked with gift cards, and one time I asked her how different state laws affected how much money WalMart could recover from those cards. She was delighted to elaborate!
I don't recall the particulars of the answer, but it was eye-opening. She said that they had a team of lawyers whose job was to (try to) keep track of all of the laws, all over the world, that had any bearing on this topic. Not only was it state and federal law, but also county and even city law. (And territories...and military bases....etc.) There were some stipulations about where the card was bought AND where the card was used, if in different jurisdictions. Many of the laws were contradictory. In some cases, none of the money could be reclaimed, and would revert to different local funds. There were effectively endless permutations.
She and her team had to decide what of all of this they would model with code. They could not model all of it, so there was a hybrid of some actions being taken with the code, and the code outputting reports that humans would use to make decisions about actions.
It was eye opening to consider how legally complex many such 'simple' things, like gift cards, are when implemented on a wide scale.