Image source: Starbucks

Starbucks has struck a multi-year deal with Uber’s main rival, Lyft. Under the partnership, Lyft drivers and passengers accumulate My Starbucks Rewards loyalty points that can be redeemed for food and beverages at Starbucks stores. Lyft drivers can also enjoy the status of Gold status members in the program.

Starbucks is a 44-year-old coffee chain that is a leader in its industry. Lyft is a distant second to Uber in its area of operations. Leveraging Starbucks as a partner Lyft is seeking to differentiate itself and draw in loyal customers. Both Lyft and Uber have tried to bag each other’s drivers using big cash offers. Passengers can tip drivers Starbucks points or stars using the Lyft app.

Adam Brotman, chief digital officer of Starbucks, said their digital loyalty ecosystem would enhance Lyft’s capability to attract as well as retain customers in a highly profitable way. With Lyft being present in 65 cities across the US and Starbucks also has its presence, this partnership would help Starbucks’ partners, Lyft drivers, and mutual customers who are patronizing Starbucks and utilizing Lyft services.

As per the details of the agreement, Lyft is buying the points from Starbucks and giving off the points internally. Though the whole financial details of the arrangements were not given, if the partnership helps Lyft to increase market share, it’s likely that Lyft will continue to buy points over time to reward loyal customers.

This is not the first partnership that Starbucks inked this year. On Wednesday, Starbucks unveiled a partnership with the New York Times Co (NYSE:NYT) to deliver select news articles to Starbucks loyalty members in 2016. In May 2015, a similar content association was formed with Spotify for access to music playlists in specially designated stores.

As part of the partnership with Lyft , Starbucks announced it will explore ways to transport Starbucks employees to and from work in one experimental market. The more the Lyft the passengers travel, the more Starbucks points they will gather.

Sources: fortune, digitaltrends

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