Brewing Success: 3 Lessons from Starbucks on Building Relationships to Boost Your Bottom Line

Every other week, I share thoughts, strategies, and anecdotes from my experience as an expert in risk, payments, technology and of course, chargebacks.

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In case we haven’t met, I’m the co-founder and Chief Risk Officer of Justt, where we are working hard to help merchants take control of chargebacks through the power of? machine learning. Previously, I managed the Chargebacks and Merchant Risk teams at Simplex, which now successfully recovers millions of dollars each year through implementing my best practices.

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Roenen

Running a business isn't just about delivering a product people want. Sure, meeting needs is crucial for survival, but to truly thrive and expand, you need something more: positive customer relationships. It's all about that human touch, the connection between your brand and your customers. Their willingness to buy and their satisfaction with their purchase depend on the quality of those relationships.

Over 50% of customers say they experience buyer’s remorse or negative emotions such as guilt and regret after making a purchase. All this results in a rising rate of returns and customers reacting emotionally at the slightest deviation from expectations. These factors feed into growing chargeback claims, with 65% of merchants reporting a rise in chargebacks and growing instances of friendly fraud over the past three years.

Building a brand that resonates with their customers on many levels rarely happens organically. Starbucks' ability to create loyal customers through innovative customer relationship strategies has had a significant impact on their bottom-line figures, and here are the lessons that can be learned.

Understanding A Customer Relationship Strategy

At the root of Starbucks' success is their ability to create a sense of community and belonging among their customers. Starbucks goes beyond being just a coffee shop and has become a part of many people's daily routines. The company has managed to create a welcoming and cozy atmosphere in their stores with comfortable seating, warm lighting, and the aroma of freshly brewed coffee.

Lesson 1: Creating a Welcoming Atmosphere

Starbucks isn't just a coffee shop; it's a community hub. They've mastered the art of making their stores feel like home. With comfy seating, warm lighting, and that heavenly aroma of freshly brewed coffee, their spaces embrace you like an old friend. They've blurred the lines between work and play, creating a coveted "third place" where customers feel at ease, whether they're popping in for a quick pick-me-up or settling down to work remotely in a lively and social setting.

Matching this level of atmosphere is obviously a challenge for online merchants, but not impossible. By putting yourself in the shoes of your customer, strive to replicate the warm and inviting feeling of a physical store. Attention to details such as intuitive website navigation, appealing product imagery, clear and informative descriptions, and personalized recommendations can help create a virtual environment where customers feel embraced and comfortable, building towards a sense of inclusion in digital first spaces.?

Lesson 2: Baristas as Relationship Builders

Baristas are the secret ingredient in creating a positive customer experience. Trained to be attentive, knowledgeable, and downright welcoming, it's all about customer service and people-oriented hiring.?

Have you noticed how you can personalize almost any menu item? That’s not an accident. Starbucks wants you to feel like your order is made just for you.

Online merchants can empower their customer success teams to build these same strong relationships by prioritizing transparency, prompt communication, and empathy. Encouraging the team to address customer inquiries with meticulous attention to detail and a genuine desire to assist can make a significant impact. By actively listening to customer feedback and proactively implementing necessary improvements, merchants can demonstrate their commitment to delivering the best possible experience. This enables trust, loyalty, and community, similar to the way Starbucks values their interactions.

People want to buy from people and if any of these simple gestures are able to make even the smallest impact, a relationship can start to form.

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Lesson 3: Leverage Being Social

By now, participating on social media platforms has become part of a daily routine for many - and since you’re reading this article right now, possibly for you too.

For businesses, this provides a prime (and free) opportunity to put these relationship building tactics into practice, but beware, there is a fine line that has to be walked between genuine outreach and coming across as astroturfing.

Leverage social media channels as a powerful tool to connect with your customers and try building a sense of community. Extending your brand's presence by actively engaging in conversations, responding to customer inquiries, and resolving complaints promptly and empathetically, lets you demonstrate your dedication to customer satisfaction.

If you’re feeling really ambitious, why not take it a step further and use these platforms to talk about initiatives that matter to your client base - the Starbucks Foundation and Ethical Sourcing program allows customers to see that the brand is not solely profit-driven but genuinely cares about making a positive impact in the world.

Putting it in to practice

This kind of change doesn’t happen overnight but online businesses that work towards creating a welcoming atmosphere, building customer relationships, and leveraging social media for instant connections experience a reduction in customer complaints or disputes, ultimately resulting in fewer returns and fraudulent chargebacks.

If you’re struggling on where to start, we’ve put together a checklist to work towards creating the best purchasing experiences to add to your bottom line in the same way that Starbucks has perfected it.

Continue reading to discover more about how Patagonia and Nordstrom are thriving with this strategy in mind.

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