On demand ride provider Lyft is getting physical – creating actual gift cards with $20 in ride credit that people can buy beginning today at participating Starbucks stores across the U.S. The cards also come with a $5 Starbucks gift card as a free bonus, and Lyft passengers will also start being able to earn Starbucks Reward Stars by riding.
This isn’t Lyft’s first tie-up with Starbucks: The ride-sharing provider teamed up with the coffee seller first in July 2015, when a multi-year deal kicked off with Lyft drivers getting the chance to opt in to Gold Level status int he old My Starbucks Reward program. Drivers could also receives Starbucks virtual gift cards as tips from riders. The two are also testing a program (Lyft confirms the test continues) in the Bay Area where Starbucks employees would get free rides from work starting late at night and continuing until early AM.
The new partnership marks the first time that people can buy Lyft credit for other riders, and Lyft VP of Partnerships Oliver Hsiang told me in an interview that physical cards offer unique advantages in terms of letting people do that.
“Believe it or not, there’s actually a lot of people who still prefer to transact and offer gifts through this channel,” Hsiang said. “We wanted to make sure that we made it as easy as possible for folks to be able to use, and to also gift Lyft as many ways as possible. The ability to be able to offer the app at Starbucks itself is also really great for us, because we’ll be located right at POS, and we can hopefully get in front of a wider audience that we otherwise might not have been able to.”
Lyft and Starbucks worked together on the details of the Lyft gift card offering, Hsiang tells me. Basically, the ride provider recognized Starbucks’ expertise in this area and sought its input when figuring out the details, eventually settling on a fixed amount per card because it’s easier on the back end, and because the $20 value fits nicely with the average rider’s trip spend.
“Starbucks, obviously, has created a very successful currency with their own cards,” Hsiang said. “So we thought a lot together about what the right denomination would be, whether we wanted to make it open-ended, for example [reloadable like Starbucks gift cards].”
As mentioned, riders can also earn stars, getting five Starbucks loyalty points for taking rides between 5 and 10 AM, Monday through Friday. Hsiang says the partnership with the coffee chain will hopefully continued with other product in the future, as the two entered the agreement with an “open-ended” mindset about where it would take them. He also said they’re “exploring” the potential of expanding distribution options for the physical cards, but had no specifics to provide.