Starbucks CEO Howard Schultz said the launch of Starbucks’ mobile order and pay app in December would be the single-most important technology innovation introduced last year. It’s clear it’s going to be the most important in 2015 as well.
Starbucks announced yesterday (March 10) that it was expanding its mobile order and pay services beyond its test market in Portland to Seattle and across the Pacific Northwest. The official rollout to the new markets will happen on Tuesday, March 17. Mobile order and pay is still only available for iPhone and will soon be available for uses at 650 locations in Washington, Idaho, Oregon and Alaska.
But that certainly won’t be the last app expansion for Starbucks, and Schultz said the company plans to rollout across the country throughout 2015. And the stats he gave in the company’s first-quarter earnings call are a telltale as to why.
“We continue to see broad customer acceptance and adoption of our mobile payment technologies,” he said Jan 22 during an analyst call. “Today in the U.S. alone, over 13 million customers were actively using our mobile apps. And we are now averaging more than 7 million mobile transactions in our stores each week — representing 16 percent of total tender. That’s more than any other bricks-and-mortar retailer in the marketplace.”
Here’s how the mobile order and pay works, according to Starbucks: Users order directly from the app just as they would at the counter of a store, they select a participating store based on GPS location, they choose a time for it to be ready and they confirm. Payment is all made via the app from a card loaded onto the app from the customer. Orders are immediately sent to the store and will be ready to pick up — all without Starbucks’ line out the door.
Starbucks has been an undisputed leader in mobile transactions, particularly because of its early entrance into the mobile market before it was all the rage for retailers. Having mobile capabilities gives the coffee company a way to prove its customer loyalty by offering a way to bring speed and convenience to the order process — all while adding some to Starbucks’ bottom line, Schultz said last quarter. It’s also launched its specialty coffee subscription last month for those who want a taste from the Seattle roastery.
Just in case Starbucks’ customers weren’t dishing out enough green to keep their cup of joe addictions percolating, Starbucks is now offering a monthly and annual subscription option for those customers who want the West Coast experience without the trip. Every month, subscribers can have access to what it calls “small-lot coffees” that are exclusive to online customers and those visiting the roastery.
In terms of Starbucks’ mobile payment volume, the company’s most recent figures showed it has surpassed the 7 million mobile transactions mark, in terms of the average per week.