Current Issue
This Month's Print Issue

Follow Fast Company

We’ll come to you.

2 minute read

Fast Feed

Starbucks's Mobile App Payments Now Represent 16% Of All Starbucks Transactions

Now that's what you call "grande."

[Photo: Flickr user Spry]

Forget about Apple Pay for a moment—when it comes to mobile payment big shots, no conversation can ignore Starbucks.

Speaking about mobile payments during the company's January 22nd earnings call, Starbucks CEO Howard Schultz busted out some pretty impressive statistics that would even impress Tim Cook.

In its financial quarter ending December 28th, Starbucks had in excess of 13 million mobile app users in the United States—representing an increase of 1 million from the 12 million using the service the previous quarter. In total, this resulted in a massive 16% of the company's total transactions (particularly impressive when you consider that 1% of sales at stores like Whole Foods was considered an early triumph for Apple Pay).

"We continue to see broad customer acceptance and adoption of our mobile payment technologies," Schultz said. "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% of total tender. That’s more than any other bricks-and-mortar retailer in the marketplace."

Next up on Starbucks's itinerary is a rollout of its mobile ordering service, currently being trialed in Portland, Oregon. Should everything go according to plan, this service will soon expand to 600 stores across the Pacific Coast, before a complete national rollout takes place in the second half of 2015.

Not only will this service help drive brand engagement with customers, but as Starbucks' chief digital officer Adam Brotman points out, it builds on an already-existing infrastructure.

"We’re not starting from a cold start," he said during the call. "We already have 13 million active mobile users. We have the POS and payment capabilities, we have MSR (My Starbucks Rewards) up to 9 million-plus. We are simply adding on mobile ordering on that staff of proprietary integrated technologies that allow us to do something like that. And it sets us up, frankly, for delivery as well. So the kind of pace of innovation, our ability to roll it out and positively influence our business overall is because we have built this and integrated it in the way it’s mentioned."

Of course, for other companies looking to follow Starbucks's model, it's easier said than done. While the company has been incredibly successful by keeping its mobile payment program in-house, few other retailers could hope to match Starbucks's combination of market clout and broad appeal.

You've got to admit it's working out pretty well for the Seattle-based coffee giant, though. Especially considering its early forays into mobile payments did not go smoothly.

[via Pymnts]