American Starbucks wants to promote mobile payments in the upcoming years. The chain believes the number of mobile payments will increase rapidly, at a time when 1 in 10 payments in the US is currently being done through mobile means.
Use loyalty program to stimulate mobile payments
Starbucks registers nearly 5 million mobile payments in its American stores on a weekly basis, more than 10 % of its total number of transactions. Howard Schultz, Starbucks CEO, wants that number to soar in the next few years and one of the ways to stimulate customers to do so is to attach mobile payments to its loyalty program.
Whenever customers spend a certain amount of money, they will get a “golden status” which will give them several extras - if they have registered their purchases through a Starbucks card. The Starbucks app also allows you to register, but you have to charge your app through starbucks.com or through in-app purchases. For the first quarter of 2014, Starbucks estimates it will get one billion euro in card charges.
Starbucks has changed its leadership structure to take full advantage of the capabilities of both the app and the mobile payments. “This new organizational change will free me up to really create and innovate around not only mobile payment, but the things that we are doing with new channels of distribution, which we can cross-promote and cross-reward our customers with stars as currency”, CEO Howard Schultz said.
Analysts expect Starbucks to collaborate with other companies, like Uber, which allows you to order a driver and a car. An example would be that people could get a gold status when he gets dropped off at Starbucks through an Uber-request. “The Starbucks app has 10 million users who are highly motivated by incentives. Other companies would be foolish not to look into the opportunities such partnerships could bring”, Yankee Group’s Jordan McKee told mobilecommercedaily.com.