In case you don’t know, Starbucks recently stopped charging for in-store internet access. I took advantage of their free internet the other day when my internet was off-line because of a problem with our internet services provider. To be honest, it was nice to get out of the house, drive a few miles down the road and enjoy a cup of coffee while doing some work online.
It wasn’t until I came across an article on SmartMoney.com this week did I start wondering whether or not my service was really free. Let me explain. Once I arrived at Starbucks I felt obligated to buy something in order to use their internet service. They don’t have a policy that says you have to do so, but I imagine most people feel this personal obligation. Otherwise, you might feel as if you’re a little out of place. And after all, they’re giving you free internet, right?
The average Mint user spent $22 a month at Starbucks during the first quarter of this year, and the average laptop user at a Starbucks spent about an hour online per session. If, the average customer spends about $4 per visit, that person would essentially be paying $4 an hour for Internet access. An average Mint user who went to Starbucks once a week for an hour would be paying $5.50 an hour for free Wi-Fi.
Starbucks is also offering other things to increase the interest of surfing in the store:
Starbucks has set its Wi-Fi service apart by also offering users access to exclusive content, including Wall Street Journal articles normally available only to subscribers. That “premium” offer is well-designed to appeal to the upscale consumer the chain wants to attract.
So, did I get my free Wi-FI the other day? Well, no. It cost me a $2 (for the cup of coffee). Obviously, the value in this case was more than entertainment as I was able to get some work done. But in general, this is definitely entertainment spending.
As consumers and money managers we need to be aware of such so-called free services and make sure they’re not motivating us to over spend our budgets. While the internet service and additional online offerings are enticing we need to remember this type of spending should be considered recreational or entertainment spending and categorized appropriatley in the monthly spending plan.
Did you think you were getting free Wi-Fi?