Nearly One-Third of Starbucks In-store Payments Are Mobile

What makes the Starbucks mobile wallet such a popular option when it comes to paying for that morning coffee?

Mobile payment at the coffee company’s U.S. stores increased to 30% of all stores, according to the earnings Starbucks reported yesterday, meaning just under a third of customers are now paying via mobile.

Meanwhile, Starbucks Mobile Order & Pay transactions increased as well to 9% of all transactions in U.S stores. Tom Shaw, vice president, investor relations for Starbucks, called mobile one of the two “critical” elements for retailers today during yesterday’s earnings call.

Said Shaw:

I refer the comments I made last quarter regarding the two critical, transformative elements required for any brick-and-mortar retailer to survive, let alone succeed in the future: an emerging digital and mobile relationship with customers that is threaded into a branded and immersive experiential retail destination.

The evidence is clear that the pace of retail transformation is accelerating with a common theme: extending the in-store experiences to include relevant digital scenarios.

While it’s not quite groundbreaking to say mobile is the future of retail payments, Starbucks remains one of the only companies with a standalone mobile wallet that its customers use with increasing regularity.  Others, such as Walmart’s Pay service, have not gotten quite the same customer response.

So what’s the draw of Starbucks mobile?

Part of it might be the simplicity of the Starbucks mobile payment experience, which relies on QR codes, a technology that is gaining more traction in the U.S. now that card processors such as Mastercard and Visa are exploring payment solutions. The company also neatly ties in rewards to using the app so that customers see a benefit (free coffee!) beyond mere convenience.

However, paying via QR code has been an acceptable and widely used method for years now in countries outside of the U.S., most notably in China through services like AliPay and WeChat Pay.

China, incidentally, is Starbucks’s fastest growing new market.

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