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Starbucks in South Korea under fire for free-gift ‘wastage’

A giveaway promotion from Starbucks in South Korea has drawn the ire of critics who allege consumers are buying coffee and dumping it to gain enough points for free goods.

The promotion has become popular, critics say customers feel pressured to buy products in “excessive” volumes.

Starbucks in South Korea is holding a promotional event from May 21 to July 22. If a customer buys 17 drinks, including seasonal drinks, they can get one of two small suitcases or a camping chair.

Rival chain Hollys Coffee has also been running a promotion since May 12 that allows customers to purchase three products useful for camping, including parasols and chairs, at a 60-per-cent discount, if one spends more than 10,000 won (US$8.10) at the store.

The problem is that some of these promotional products are exploding in popularity, and there is an abnormal craze, such as mass purchases of unwanted drinks to receive them.

On social media sites, tips on how to buy 17 drinks at Starbucks for the lowest price (68,700 won) have been shared.

Starbucks does not disclose the number of free gifts available at each store, but information about the stores is being posted online.

Last Friday, a customer bought 300 cups of coffee at a time and returned home with only the small suitcases, as free gifts.

The customer posted a memo titled “All Free” for the remaining 299 cups besides the one he or she took, but no one drank them, so all the coffee was reportedly discarded.

In addition, some of the Starbucks suitcases are being sold for up to 200,000 won on online shopping malls and secondhand trading sites.

“It is a thank-you event for customers who usually buy more than two cups a week, but we are in a difficult position as other customers report of the inconvenience,” a Starbucks in South Korea official said.

“However, these gifts are being praised for their design and practicality.”

Hollys Coffee has been holding an event that allows customers to purchase three products useful for camping, including parasols and chairs, at a 60 percent discount (image: Hollys Coffee)
A Hollys Coffee promotion allows customers to purchase camping gear at a 60-per-cent discount (image: Hollys Coffee).

Hollys Coffee is also known to have many people lining up from dawn to buy its promotional items or going from store to store in search of a particular item.

The craze is also attributed to the fact that both companies have released gifts aimed at “home camping.”

Interest in domestic travel and camping has grown as the global Covid-19 crisis has made it virtually impossible to travel abroad during the summer vacation season.

In particular, “home camping,” which can be enjoyed on verandas, porches or terraces at home, has also become popular as the number of people staying at home increases due to the coronavirus outbreak.

According to Gmarket’s recent survey of sales during the period from April 22 to May 21, sales of tents for home use increased by 39 per cent year-on-year, compared to growth of 49 per cent for folding tables, and 48 per cent for folding camping chairs.

Some point out that the purpose of the promotional events, which were intended to convey a token of gratitude to loyal customers, is becoming blurred. Some are calling for measures such as limiting the quantity per person.

“Unlike ordinary products, there is a problem where food and beverage be discarded if they are not consumed immediately,” a retail industry source said.

“To prevent this phenomenon of throwing away money, Starbucks should be telling customers how many free gifts each store has prepared.”

  • DM Park writes for Korea Bizwire. This is an edited version of the story.

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