Nearly a year ago, Starbucks Coffee Company rolled out the nation’s largest mobile payment program with the goal of offering a truly innovative mobile experience for customers worldwide. U.S. customers were introduced to a smartphone application with a Starbucks Card stored within the app, providing the most convenient and fastest way to pay for Starbucks purchases. That momentum has continued as the company heads into its first mobile holiday season.
During 2011, Starbucks expanded its mobile payment program to give customers access to the fastest way to pay at more than 9,000 U.S. locations, introduced the Starbucks for Android app, rolled out the Starbucks Card eGift feature, started international expansion and developed the Starbucks Cup Magic app to share augmented reality experiences in its stores and beyond.
“2011 was a year of great mobile exploration and expansion for Starbucks and an opportunity to give our customers a new way to connect with Starbucks through a variety of mobile experiences,” said Adam Brotman, svp and gm Starbucks Digital Ventures. “The customer response to our mobile apps has been phenomenal. Not only are they using their phone as a wallet, but as a connection point to Starbucks as they manage their Starbucks Card accounts, send eGifts and get into the holiday spirit with the Starbucks Cup Magic app.”
Since the launch of mobile payment in January, there have been 26 million mobile transactions to date. In the first 9 weeks of the program, there were 3 million transactions and in comparison for the 9 week period starting in October, there were 6 million transactions, demonstrating a significant jump in customer adoption and use.
Globally, the Starbucks Card program had $2.4 billion loaded onto cards during FY11, and Starbucks Cards are currently used for 1 in 4 transactions in the U.S. Since the card launched just over 10 years ago, more than $10 billion has been loaded on Starbucks Cards. On the mobile front, since Jan. 2011, there has been $110.5 million reloaded onto Starbucks Cards directly through the mobile app.
Starbucks took its mobile payment program beyond its nearly 7,000 U.S. company-operated stores and more than 1,000 Target stores to include nearly 1,000 Safeway stores in June, giving customers more opportunities to experience mobile payment. Currently the top five US cities for Starbucks mobile app adoption are New York, Seattle, San Francisco, Chicago and San Jose.
Within the mobile apps, customers have access to a host of features that allow them to manage their Starbucks Card account: reload their Starbucks Card balance directly from a smartphone device, find nearby Starbucks stores with the store locator feature, check their Starbucks Card balance and My Starbucks Rewards status. There are currently 2 million Gold-level My Starbucks Rewards members in the U.S. and 3.6 million My Starbucks Rewards members overall – with 2 million My Starbucks Rewards members added in FY11 alone. Other features available in the Starbucks app line-up include a drinker builder, Starbucks food and beverage information and Starbucks coffee information. Starbucks Card mobile payment is the most popular app feature overall.
eGifting & Starbucks Card
In addition, Starbucks Card eGift was added as a feature in June and since October, sales have doubled to account for 10 percent of Starbucks Card eGift sales. The eGift experience gives Starbucks a platform to offer customers completely customizable cards with themes and occasions that may not be featured on Starbucks Cards in stores such as Humor, Work-place specific, Seasonal (Halloween), Kwanza, Latino and Hanukkah. As the digital extension of the Starbucks Card, it is part of the world’s most popular gift card program. Starbucks Cards are currently available in 20 countries.
Internationally, mobile is on the move as Starbucks introduced Starbucks Canada app on Nov. 8 to offer mobile payment in 1,000 stores in Canada. Additionally, Starbucks will be first on the high street to offer UK customers the option to pay with select smartphone devices at more than 700 Starbucks stores. It will debut in the UK on Jan. 5.
Building on Starbucks mobile app portfolio is the Starbucks Cup Magic app for customers in the U.S. and Canada which incorporates the latest in augmented reality technology to offer an animated visual experience. Customers can download and use the app to discover Starbucks holiday characters as they leap to life in merry holiday scenes by scanning Starbucks iconic red cups, holiday coffee bags and store signage. The app has proved popular with an engagement rate of 91 percent and more than 450,000 visits to the AR experience. The Starbucks Cup Magic app is equipped with an eGift feature, allowing users to send Starbucks Card eGifts to friends and loved ones from their smartphone device in the U.S. and it’s perfect for last minute holiday gifts.