By RON LIEBER
Published: June 7, 2008

IN 1981, when American Airlines was struggling to differentiate itself in a newly deregulated industry, it invented the frequent flier mile. Ten years later, American Express responded to its own competitive crisis by introducing what we now know as Membership Rewards.

So it shouldn’t come as any big surprise that Starbucks, facing its own troubled times, would also turn to a loyalty program.

This week, the company flipped the switch on the latest piece of its new Starbucks Card Rewards program: two hours of free wireless Internet service a day. The other freebies include syrup and soy milk additions to its drinks, refills of drip coffee and a tall beverage of any sort for people who buy a pound of whole bean coffee.

On a pure dollar basis, all of this doesn’t add up to much. It’s no free ticket to Maui, after all. Starbucks is well aware of this and says that it is just getting started…

The point of a loyalty program is, first and foremost, to grab a bigger share of customers’ spending. Companies often do this by giving away currency of some sort, like miles or points, that people can trade for free trips or merchandise. Then, the goal is to keep buyers from straying, by offering, say, an elite status with special perks that they must qualify for each year.

Tracking customers through loyalty program account numbers offers companies an additional advantage. “If you don’t have a lot of information on your target audience and you need to get it, then you want to try to encourage people to enroll in as large a number as possible,” says Rick Ferguson, editorial director at Colloquy, a loyalty marketing firm. Once a company has more data, it can tailor the program further and aim at the most profitable customers with special offers.

That’s what Starbucks will try to do now. Sales at stores open more than a year are actually falling, which has never happened to the chain before.