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Starbucks’ mobile app is a leader in the fast-food and fast-casual restaurant industry. In Market Force Information polling conducted in January 2015, nearly seven in 10 US internet users who were aware of the coffee company’s app had downloaded it—higher than penetration for all other restaurants in the coffee, bakery and doughnut category, and 10 percentage points above second-place Dunkin’ Donuts.
Many Starbucks customers are willing to download its app, place orders and pay via their mobile devices. As such, the coffee giant’s app lands near the top for mobile payment usage. In a December 2014 study by 451 Research, Starbucks was the second most popular app US mobile phone owners used to pay for goods in physical stores in the past month, cited by 6%. This trailed only PayPal (14%) and was ahead of Google Wallet (4%), Amazon Wallet (3%) and competitor Dunkin’ Donuts (3%), among others.
Coffee in general is an attractive purchase for mobile wallet users, likely due to its low price. In a June 2014 study by Thrive Analytics, 35% of smartphone owners in the US who had ever used a digital wallet purchased a coffee, drink or snack in the 30 days prior—the No. 1 response. Clothing, shoes and jewelry ranked second (32%), followed by groceries (20%), books (18%) and movies and tickets (18%).
Now, Starbucks is enhancing its mobile ordering feature, highlighting the need for other food and beverage companies to get their mobile strategy together. Starbucks’ mobile ordering enhancement will prompt its app users to order whenever they’re near a participating establishment. Users will then get to choose where they want to pick up from a list of nearby locations, all while seeing a store’s distance, how busy it is and how long the wait time is—and on-the-go payment means they can avoid long lines.
For the most part, preordering beverages and snacks via mobile is still uncommon. November 2014 polling by Ipsos for PayPal found that just 9% of US smartphone users had ordered an item such as coffee or food ahead of time using an app or browser on their phones. However, with Starbucks making the process more helpful and easier, others in the food and beverage industry will likely follow suit. As these new options become available, consumers will likely choose to get their coffee, or other treats, conveniently.
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