Starbucks Plans to Test Mobile Ordering This Year
Starbucks Corp. (SBUX), the world's largest coffee-shop operator, will test a smartphone service this year that lets customers order items ahead of time at some U.S. cafes, part of a push to promote its mobile application.
Context & Ripple Effects
Starbucks had already extended its app beyond the café counter with a mobile-payment app on Android in 2011, and its apps had processed 26 million mobile payments and $110 million in card reloads by December that year. The planned U.S. café test moves that established payment relationship into the ordering step.
The initiative also follows Starbucks’ plan to add iPhone tipping to its app, making the app a broader transaction interface rather than solely a stored-value payment tool.
First-order effects
- Customers at participating U.S. cafés will be able to place orders before arrival, while those stores must integrate app orders into barista production and pickup routines.
- Starbucks gains direct visibility into the order before the customer reaches the counter, extending its app from payment completion to purchase initiation.
Second-order effects
- Café throughput becomes a product constraint: Starbucks must prevent prepaid pickup orders from disrupting walk-in service at the same bar and handoff area.
- Starbucks’ own app becomes more central to the customer transaction than partner payment acceptance, raising the value of app adoption and stored-value reloads.
Third-order effects
- If order-ahead use scales beyond a test, quick-service retail will increasingly compete on digital queue management and pickup operations, not only payment acceptance.
- The pattern points to merchant apps evolving from loyalty and payment wallets into owned ordering channels that control more of the customer relationship.
The trend: Mobile wallets are expanding from a way to pay at the counter into merchant-controlled systems for initiating, paying for, and collecting retail orders.