Starbucks launches an NFT marketplace

Dive card:

• Starbucks is launching an NFT marketplace called Starbucks Odyssey, which will be integrated with the company’s loyalty program, it announced on Monday.
• Customers will have two ways to collect Starbucks NFTs: they can collect digital stamps by completing in-app tasks, such as quizzes, or they can purchase limited-edition tokens directly through the app via credit card.
• Starbucks’ NFTs “will unlock access to new benefits and immersive coffee experiences,” according to the press release.

Diving Insights:

Starbucks claims it is one of the first chains to tie NFT offerings to its core business, but several major restaurant companies are pursuing Web3 activations in an effort to expand digital touchpoints and attract Gen Z customers.

Starting Monday, Starbucks customers and employees can join a waiting list to access Starbucks Odyssey, which will go live later this year. The platform will host virtual “journeys” or interactive games and challenges that will allow users to “deepen their knowledge of coffee and Starbucks.”

“Members will be rewarded for completing journeys with a digital collector’s item ‘travel stamp’ (NFT),” Starbucks said in a press release. “Members may also purchase ‘limited edition stamps’ (NFTs) through a built-in marketplace within the Starbucks Odyssey web app experience.”

Starbucks NFTs will have a point value based on rarity, enabling token holders to access rewards ranging from virtual espresso martini-making classes to trips to the company’s showcase coffee farm in Costa Rica. Users can buy and sell tokens on a marketplace within the company’s app.

Brady Brewer, Starbucks executive vice president and chief marketing officer, said in a press release that the NFT offering was integral to the company’s future vision.

“This is just the beginning; Starbucks Odyssey is one of the ways we’re reinventing the third place to meet our customers wherever they are,” Brewer said.

The NFTs issued by Starbucks is secured by a “proof-of-stake” blockchain, which the brand claims is more energy efficient than the notoriously inefficient “proof-of-work” systems that Ethereum or Bitcoin. However, it is unclear what degree of efficiency Starbucks’ system achieves.

Starbucks’ investment in NFTs comes as weekly trading volumes, measured by value and number of sales, continue to erode. The weekly volume of trade in digital collectibles and art objects peaked at $914 million last August, according to Block.co, a website that analyzes market trends in blockchain-related technology. Since then, the weekly trade in collectibles has fallen below $30 million in value, making long term value of digital stamps uncertain.

The coffee chain’s NFT offerings also go beyond the Web3 games of many of its rivals, who have limited their experiments with this technology to limited-time experiential offerings. Pizza Hut offered a virtual shopping experience in May, around the same time Jimmy John’s rolled out a virtual restaurant customers could use to order real custom sandwiches. Wendy’s announced a virtual restaurant in April. That same month, Chipotle added a virtual work experience to Roblox, giving customers the ability to roll digital burritos in exchange for burrito-themed in-game currency. These two initiatives appear to be long-term offerings.