Enabling Technologies

Starbucks gets Better and Better with its Mobile App, Over 5 Million Payments every Week

Almost 10 Mn consumers utilize the Starbucks mobile payments app to pay for their coffee, croissants and those blueberry chocolate balls. According to the company, they amount to a whopping 5 Million mobile payments every week. “Mobile and physical Starbucks Card payments now account for more than 30% of the company's U.S. payments, thanks to a boost in gift card use during the recent holiday season,” said Howard Schultz, CEO of Starbucks.

In 2009, Starbucks achieved a breakthrough of sorts by launching a mobile card app on the app store for Starbucks Card customers. The mobile app showed a customer their current balance and also could be reloaded through any of major credit cards. As part of the pilot study 16 stores participated in this program.

In 2010, Starbucks introduced a mobile app and tied it to its loyalty program. The program was first introduced in Seattle and San Francisco and was later rolled out to other outlets in the US. Over the time, the program was completely functional in its 6800 stores in the US.

Square Wallet + Starbucks Wallet:

Back in August 2012, Starbucks partnered with Square to launch Square Wallet app on iOS and Android based mobile phone devices. Starbucks invested close to $25 Million in Square to process its U.S. credit card and debit card transactions. Square Wallet is more or less similar to the Starbucks mobile card app but the main difference being that the Square Wallet can be used for transactions at other vendor outlets and the users need top off with funds to use Square Wallet as its integrated with debit card and credit card information.

In 2013, Starbucks revealed that more than 10% of its transactions were through mobile payments. Now it says that 30% of its U.S. transactions were made either using mobile or plastic version of Starbucks card. “More than 40 million new Starbucks card activation (s) valued at (more than) $610 million in the U.S. and Canada alone in Q1. Including (more than) 2 million new Starbucks card activations per day, in the days immediately leading up to Christmas and $1.4 billion of Starbucks card loads globally," said Shultz.

"We invested and continue to invest well ahead of the curve and today have world-leading proprietary digital, social, mobile payment and card technologies and assets. These assets are enabling us to broaden and deepen our connection to customers, enhance overall Starbucks customer experience and further (distance) ourselves from competitors,” Howard Shultz said. "And we have a full pipeline of new technological innovations introducing in the quarters ahead that will fully leverage these assets and provide us with even greater benefits into the future. And we are just beginning to appreciate the full magnitude and possibilities of the Starbucks mobile payment platform opportunity," he added.

Chiraag Patel

Chiraag Patel is a Senior Reporting Analyst and the Editor of Bitcoin and Virtual Currency channels at Lets Talk Payments. He is an engineer with deep interest in MMORPG, Virtual Banking, Game Currency and Virtual Cash. Chiraag enjoys Reading& Blogging with focus on New Innovation, Technology & Startups in the Payments Space.

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