September 23, 2015
Starbucks’ Mobile Order & Pay app—which allows customers to place an order from their mobile phone, thereby skipping the line at the register—is now available at all company-owned Starbucks stores in the US. Initially available only for iPhone users, the app is now available for Android users as well.
Mobile Order & Pay allows customers to place orders before they arrive at the store and pick them up at their chosen Starbucks store later. The app interface shows store locations, which appear based on the GPS functionality of the customer’s phone. The mobile ordering process simply involves scrolling through the menu on the app interface, picking your choice of items and your store of preference, and then paying using the in-app payment system. The particular store gets notified of the order, which is prepared and kept ready for when the customer arrives at the store.
With 16 million active users, coffee chain Starbucks is now clocking 9 million mobile payments per week. In terms of transaction value, it amounts to 20% of all transactions in US stores. Since December 2014, the number of active users has grown by 3 million and the number of weekly payments has grown by 2 million.
The major driver in achieving the 9-million-transactions-per-week mark is the Mobile Order and Pay facility. By Q2 2015, the coffee giant expanded the facility to more than 650 stores in Washington, Idaho, Oregon and Alaska. In the last quarter, i.e., Q3 2015, they have accelerated further. The Mobile Order & Pay facility is gaining tremendous popularity because of the shorter queues and faster, efficient service.
The growth of mobile phone users, mobile and smartphone penetration coupled with decreasing prices of handsets has made mobile payments the number one focus area for every organization.
Being a renowned restaurant, Starbucks understands that the market is moving towards mobile payments in a big way. Expanding its service shows how the company is strategically planning to move with the flow.