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Starbucks's Shoddy Square Rollout Baffles Baristas, Confuses Customers

About 7,000 Starbucks locations offer a supposedly simple system for letting customers pay with credit and debit cards using Square Wallet. Starbucks even invested $25 million in the payments startup. So why can't baristas make it work?

The Starbucks clerk was at a loss. I had just ordered a mocha Frappuccino and asked to pay with Square, a service that allows customers to purchase goods at the coffeehouse chain via their smartphone.

"What? Square?" the clerk asks me, as she turns to another Starbucks employee behind the counter. "Can we pay with Square?"

"I don't know," the other employee responds. "No."

"But there's [a Square] option here," the clerk says, as the two huddle close to the register's screen. The clerk tries to scan my iPhone with her barcode reader, repeatedly tracing it up and down over the surface of the device, which is running Square's Wallet app. A minute or two passes. No luck. "I don't know how it works," she says. "It won't scan. It's weird."

The line of customers behind me was getting long. I felt uncomfortable. I decided to pay with cash instead.

We're at a Starbucks in lower Manhattan, one of roughly 7,000 locations that is supposed to accept payments via Square Wallet. Over the summer, Starbucks announced its wide-ranging agreement with Square to have it handle the company's debit and credit card payment processing; additionally, Starbucks invested $25 million in the payments startup. The news brought significant press attention to both companies. "This is an epic partnership," Square CEO Jack Dorsey said at the time. In November, Starbucks began accepting payments from Square's mobile wallet app. "Walk into a Starbucks store and place your order. Open the Square Wallet app, tap on 'Starbucks' and scan your phone," Starbucks promised. "That’s it!"

But after nearly three months in the wild—and several rounds of glowing press coverage since the partnership was announced—the experience of paying with Square at Starbucks is anything but polished. We've been experimenting with the service in recent months, having our reporters and freelancers (and a few volunteers) around the country test it out at almost two dozen Starbucks locations. At worst, the service simply did not work. On average, however, the user experience was buggy and awkward, with Starbucks employees seemingly more confused about how Square works than their own customers. Our evidence is anecdotal—and our sample size small—but the results of our tests are telling, especially given the reputations Starbucks and Square have for customer service. It serves to show that however refined a user experience might be on a local level, scaling such a streamlined UX all at once is borderline impossible.

System Failure

At a Starbucks outside Boston, an employee could not figure out how to accept payments with Square. The scans would not go through in the register system, and the barista quickly gave up trying to get it to work. At a slew of locations in New York City, employees were equally as perplexed as to how the system worked with Square, even after multiple visits to one of the locations. Ultimately, many of these Starbucks locations were not able to accept payments via Square Wallet.

But even when employees figured out how to accept Square payments, the process was slipshod. In many tests, employees were not able to scan the Square Wallet app from their barcode readers. Instead, Starbucks employees have taken to asking to hold a customer's smartphone, and manually type the barcode number into their register. At one location near NYU, after unsuccessfully (if not desperately) trying to scan my iPhone in front of the scanner for more than a minute, the Starbucks clerk left the counter to ask her manager how Square worked. "You gotta type it in," the manager said. "They never showed us how to scan it—we don't know how to scan it."

The clerk returned, asked for my iPhone, and tried a few more times to scan it in herself. Even the customer behind me was trying to help. After failing again, the clerk, who was still holding my iPhone, tapped a few buttons on the register's screen, turned back to her manager, and asked, "But how do you get the keyboard? The keyboard is not coming up."

Another painful minute or more passed by, with the clerk promising to figure it out, as she attempted to type in the Square barcode number again. At one point, she apologized to me because, while holding my phone, someone had texted me and she'd accidentally clicked out of the Square Wallet app—and into my personal messages.

At another location near the Financial District, when I asked to pay with Square, the clerk asked, "Wait, is this the Starbucks card?" After explaining that it was different, the clerk said, "I don't think it will work." She then asked another employee for help, and the two eventually got it working after typing in the Square Wallet barcode number. "You just got to tell them to type in the number [in the future]," the employee told me.

At a string of other Starbucks locations, we experienced the same outcome. The scanner rarely if ever worked, many employees said. They always typed in the numbers. (And after the transaction went through, some employees still printed out and handed me a receipt—despite the fact that Square was designed to end these unnecessary interactions.)

"Sometimes it works; sometimes it doesn't work," said one clerk at a Starbucks in the Village. "And I have no idea why."

We reached out to both Square and Starbucks for this story. A representative from Square referred us to Starbucks for comment. Adam Brotman, chief digital officer of Starbucks, tells Fast Company that scanner calibration issues may be to blame. "It's an early issue we had to address—we had to calibrate [the scanners] to work with QR codes from Square," explains Brotman. He says the issues have since been fixed, although our last failed test using Square Wallet at Starbucks occurred on March 5. Brotman also suggested we may have been visiting some licensed Starbucks stores, rather than company-owned Starbucks sites. Roughly 70% of Starbucks are company owned, and only these locations accept Square payments. Licensed Starbucks locations do not accept Square. Yet after checking the locations we visited with a Starbucks representative, it turned out just one of the stores we visited was a licensed store. (And regardless, customers cannot tell the difference between a licensed and company-owned store; if one tries to pay with Square at either location, and it does not work, he or she would consider it a failure on the part of Starbucks and Square.)

You Want To Pay With What?!

As inconsistent as the experience may have been at the locations we tested, it's important to note that the system worked flawlessly at a number of stores. At a Starbucks in Englewood, New Jersey, we had no issues paying with Square, nor did we experience trouble at a store in Washington D.C. and one in Ann Arbor, Michigan. The same with a location near City Hall and another in the East Village in New York City. At a Starbucks in Menlo Park, California, employees were very knowledgeable about how Square worked.

But regardless of the times our tests were successful, it's inexcusable that customers can pay with Square at a Starbucks in the East Village and not purchase items through the service at an outlet just blocks away. It's unacceptable that Square should work in Menlo Park and not in Massachusetts. The promise of Square's partnership with Starbucks is that it will yield a seamless payment experience for customers. But that's not the case. Rather, what we found—even at locations where Square worked—is that Starbucks employees have received little if any training with Square, and more often than not only learned of the partnership and digital payment method from customers themselves. As one Starbucks clerk told me at a location near the World Trade Center site, "No one ever told us about it until a customer walked up and brought it to our attention. We were trying to figure it out, and eventually we got it to work. But that's how we learned about it. We just had to put one and one together."

Brotman tells Fast Company that it's not uncommon to endure bumps when introducing such a novel program. "When we launched our Starbucks mobile payments, we didn't have a totally dissimilar experience," he says. "You're trying to roll out a completely new behavior across 100,000 baristas and 7,000-plus stores. It took us a few months to get complete awareness and training into the hands of every single barista, and to figure out how to make sure new baristas were being properly trained."

It's clearly a huge challenge for Starbucks and was especially evident during our reporting for this article. At one location, a Starbucks employee complained of her lack of training: "I had to figure it out myself. They didn't even tell us they were going to do it. I came in one day, and they had put a new button on the screen. So we all had to just figure it out."

At a Starbucks not far from Stuyvesant Town, in Manhattan, a Starbucks employee had never heard of Square. "Huh?" she responded when I asked if I could pay with Square. "What is it? Is it a Starbucks card? Is it a barcode?" She was unable to get it to work after she tried scanning it.

One store manager explained that in October, Starbucks held a summit in Houston—which Fast Company attended—to train store managers with Square. "That's when we found out we were going to have Square, so basically they trained us and we came back," the manager said. "We knew the concept and how to use it, but other than that, that was really it."

Despite that training, it's clear that not all Starbucks employees received the message about Square (nor even all store managers). Even at one location in a trendy area of Houston, where the training summit was held, when asked whether a tall iced chai latte could be paid for with Square, a barista responded, "That's a good question." She said no one had paid at that location with Square before, and that she'd received no training for the service. She was unable to figure out how to get the payment processed (saying it required a "payment code"). Though there was a Square button on the screen, the barista was unable to accept our payment with Square, even after she asked a coworker for help.

Of our tests in New York City, employees at a dozen locations we visited required help from other coworkers or a store manager—and even then employees could often not get the system working.

At a location on the Upper West Side, employees knew of Square and its benefits—not that it was much help. "This machine is configured for Square," chirped a barista as she assisted her coworker. "But we don't know how to use it." The barista whipped out a clipboard, squinted at what looked to be instructions, and fiddled again with the register. In the meantime, she ticked off the advantages of Square: how cool it is, how you eventually won't have to take your phone out to pay, how it could soon tell what you wanted to order even before you got to the cash register. It seemed like she memorized a press release. Unfortunately, the performance didn't match the promise. The baristas soon gave up, and we paid in cash.

At the Starbucks store near NYU, after the clerk realized how to enter my Square barcode number into the register, she asked for my name. When I asked why she wanted my name, she said, smiling, "Because I want to tell [my managers and/or coworkers] that I learned from you [how to use Square]."

Venti Resources

The promise of paying with Square is that it offers merchants and customers a better user experience. For customers, the idea is that it's easier to pull out your phone than your wallet—easier to interface with an app than credit cards or dollar bills. And for merchants, the value of the service is that it will create a streamlined payment experience—a more efficient process that will require fewer resources and employee time.

In my experience using Square Wallet at local, independent merchants, that is indeed the case. It's simple, fast, and intuitive for both customers and merchants. But the opposite is true of my experience using Square at Starbucks, a national chain. Rather than taking less time, the payment process takes longer with Square; rather than creating a seamless interaction, the experience can feel uncomfortable and frankly embarrassing, especially when long lines form and Starbucks employees insist on figuring out how the system works regardless of who they make wait and for how long; and rather than making it easier for Starbucks employees, I've found the service often requires more workers to get it right.

Take my recent experience at another Starbucks near SoHo:

Me: I'd like to pay with Square.

Starbucks Employee (SE) #1: What else did you want?

Me: No, I said that I'd like to pay with Square.

SE #1: Oh, I don't know if that's going to go through.

The clerk tries scanning my phone.

SE #1: Yeah, I don't think that's going to go through.

SE #2: Something about that—it just won't scan. It won't scan.

SE #3: No, you got to click [the] Square [button on the screen].

SE #1: We tried that.

SE #4: It's not going to work.

At this point, a store manager came over, and I watched as five Starbucks employees (yes, five) crowded around the register, looking over each other's shoulders, trying to get the system working. The manager eventually had the employees type in the Square Wallet barcode number into the system, and then two employees—one holding my phone, one typing the numbers—were able to get my payment to be accepted. It took, by my count, roughly two minutes just to pay. For a donut.

At many of the Starbucks we visited, it often took two to three people to get the system working.

Brotman, the chief digital officer, acknowledges inconsistencies in the experience, but he says it's better for Starbucks to move faster and make mistakes, than move slower and risk falling behind. "When it comes to our current mobile payment process, including our rewards process, it's not 1,000% consistent across every single one of our Starbucks stores, whether licensed or company owned, and that's something that we're not okay with," he says. "We strive to have it be perfect and seamless across all of them. But we don't want to wait on innovation. Just because if we waited until we could make it perfect across every single experience of every single store, we would have to move much more slowly for the vast majority of our customers. So we've taken an approach that's not always perfect, but we think it's the best thing for our brand and customers. We now have to work through the barista and customer education issue, and it's not easy. But we're committed to doing it, and 100% committed to Square."

"[This] reminds me a lot of when we first launched mobile payments and spent the first few months figuring out how to fix everything," says Ryan Records, Starbucks VP of payments. "We were solving one [problem] after another, and we probably had more misses than hits before we reached a tipping point. But then it became seamless, and it became flawless, and it really became an elegant way to pay."

It's clear that if Starbucks doesn't start training employees, customers can't be expected to do the job—not least because very few customers are even using the service. How frequent do customers ask to use Square? "Very rarely," said one clerk at yet another location. "One customer did it yesterday, but that's it," said another. "Very few—maybe five total," said another employee. "I've maybe seen three people do it," said another. "Honestly, you're the second person I've seen use it in months," said one store manager. "Just two, but it's never worked successfully," said another clerk. "One other person tried it but we couldn't get the system to work," added a different employee.

Starbucks declined to share Square usage data with Fast Company, and although our evidence is anecdotal, the employee reactions are on par with a recent study by ComScore, which found that U.S. consumers had a low level of awareness of digital wallets. According to the survey, just 8% of respondents were even aware of Square Wallet, and only 2% had ever actually used it. With such insignificant adoption, the experience of Square Wallet must be impeccable in order to gain repeat usage and foster word of mouth. Otherwise, it's unlikely customers will use the service again.

The poor rollout of Starbucks' new customer experience not only reflects poorly on Square, but also puts into question how much the companies were lauded for the partnership. It's likely the process will be streamlined over time, but at present, the experience is anything but Square-like. Of the 20 different Starbucks stores where we tried paying with Square, six were unable to process payment through the service whatsoever. (One of these locations, it turned out, was a licensed store.) Another six were unable to scan Square, but eventually figured out how to type in the barcode to accept payment. And just eight store locations were able to accept it successfully. Depending on your outlook, and discounting the licensed store, that's either a 26% failure rate (if you count typing the barcode in as the proper experience) or a 57% failure rate (if you consider the barcode entry inadequate). Again, the evidence is anecdotal, but if any service failed to work three out of every 10 times—whether ZipCar, Foursquare, Instagram, or Netflix—that would simply be unacceptable.

As the store manager at the Starbucks that took five employees to complete the transaction said, "Well, it worked. It's probably [difficult] because it's just so new. But it did work."

Well, not exactly.

Additional reporting by Nancy Miller.

[Illustrations by Joel Arbaje]

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