Starbucks is known for being a leader in the coffee world. The Seattle-based retailer has grown so much over the years that there are few major cities that don't have one of the bistros located on every street corner. Now, Starbucks is taking charge on another front – mobile payments.
According to Bloomberg Businessweek, while the coffee chain's innovative payment program is only a year-and-a-half old, it is possibly the largest of any retailer in the country. Just last month Starbucks invested $25 million in Square Inc. to process the payments.
"What mobile payments allows is an unprecedented relationship between us and our customer," says Adam Brotman, Starbucks's chief digital officer.
In 2009, Starbucks released an application that included a store locater, gave customers information about coffee and the nutritional value of drinks. Two years later, it developed into something more, giving consumers the ability to pay at the register by waving their smartphone in front of a scanner. Customers simply load a Starbuck's digital prepaid card with an existing credit card.
Starting this fall, though, the application will allow customers to pay via an account linked directly to their credit cards, reports the news source. This is a move that the coffee giant hopes will give itself a profit boost, as the company will have to pay fewer fees on credit card transactions.
Richard Crone, who leads payments consultancy Crone Consulting, added that store lines will also move 10 to 20 percent faster during peak hours with the convenience of the application.
As customers are becoming increasingly dependent on smart phones and other mobile devices, companies need to find ways to meet those evolving needs. Pairing with a third-party answering service that offers contact through text messaging services and website customer support will give consumers an option that is most convenient for them.