Grande Plan of Starbucks: to sell coffee with App

When it comes to technology companies, you shouldn't be the first to think of Starbucks, which sells coffee. However, they may have the best mobile retail apps on the market.

As Starbucks executives, they certainly consider their mobile apps to be "unique". Last week, Starbucks released another bullish earnings report, which showed that its share price was up more than 50 cents a share from 2015. Howard Schultz (Howard Schultz), chairman and CEO of the company, told analysts: "Today, more and more of the consumer economy is moving towards mobile. In this process, we occupy a dominant position as stable as Mount Tai. We will only further consolidate our leading edge and connect our business and products more closely with the mobile economy. "

Schultz introduces Starbucks' digital strategy in detail and describes how they gain a head start in the market in different ways. He pointed out that Starbucks' mobile app has the functions of ordering and paying for meals. Users can order a latte through a mobile app at 7500 Starbucks coffee shops across the United States and pay for the coffee before it is served. According to him, Starbucks sells more than 5 million of its mobile apps every month, and that figure is growing. The coffee company recently partnered with the New York Times, music provider Spotify and taxi-hailing app Lyft to make a difference in the digital space. Schultz says Starbucks' customer loyalty Program (loyalty program) now has 20 million members. In addition, Starbucks recently launched an one-click on-demand innovation service: two weeks ago, the company began providing coffee delivery service in the Empire State Building. They also plan to work with delivery company Postmates later this quarter to launch a door-to-door coffee delivery service in Seattle.

Starbucks makes full use of a variety of ways to combine its business model with personalized technology that consumers like. According to company officials, the number of active users of Starbucks apps is growing at an annual rate of 32%. According to the data they released, about 9 million consumers use the Starbucks app to buy coffee in the store every week. In total, the total number of users using the app to buy coffee reached 45 million. Sales of Starbucks apps broke records in October, setting a new milestone: mobile apps accounted for 21% of all Starbucks sales in the United States that month. This rapid growth is the envy of even Apple.

The first people to eat crabs

Starbucks has always done well in digital. As early as 2002, they provided Wi-Fi Internet service in coffee shops. In 2007, Starbucks reached a partnership with Apple to allow consumers to use iTunes Music services for free. In 2008, the company launched the Best of the week project (Pick of the Week). Consumers can download music from iTunes for free by getting iTunes download cards at Starbucks stores.

In order to achieve greater success in the digital field, Starbucks' next move is to launch mobile apps. Do you remember the last time you checked out with a mobile app in a brick-and-mortar store? From a personal point of view, I can only think of Starbucks mobile apps and Apple retail store apps. In fact, many companies on the market have their own physical store mobile apps, such as fast food chain Wendy "s, Mexican fast food company Chipotle and retail giant Wal-Mart. However, consumers have low awareness of most retail applications. Sometimes consumers do know about a retail app, but they feel that using it doesn't bring them much added value. Starbucks and many companies have jointly launched the "customer loyalty Program", which solves this problem very well.

"Starbucks applies technology in many areas, including payment, customer loyalty, incentives and content," said Jack Jack Kent, director of mobile at research firm IHS. It's all about boosting sales. "

Cooperate with Apple

Apple is the most profitable company in the world, and they can always develop clever designs and combine them with retail apps. Even so, they want to work with Starbucks.

Since the introduction of the exciting mobile payment feature last year, Apple seems to be struggling a little bit. Apple Pay is seen as an ambitious expansion for the company. Through its easy-to-use mobile service, Apple plans to build its own digital payment channels and eliminate credit cards. Tim Tim Cook, the company's CEO, boasted that users activated more than 10 million credit cards within 72 hours of Apple Pay's launch. Reuters quoted data from market research companies as saying that by the end of September this year, 14% of households with credit cards had signed up for Apple's payment service.

However, the same survey also shows that the growth rate of Apple Pay has slowed. Apple has not yet released the number of users at this stage of the Apple Pay. In a recent revenue conference call, they only mentioned that "the transaction volume brought about by Apple Pay is still growing at a double-digit rate per month."

How to promote the rapid development of Apple Pay? How to cooperate with companies that have been successful in the field of mobile payment? In its most recent revenue call, Apple announced that it would promote full support of Starbucks services with Apple Pay in 2016, allowing consumers to use Apple Pay to buy coffee in all Starbucks stores across the United States.

From this point of view, Starbucks has achieved remarkable results in the field of digital strategy. Moreover, their pace of development has never stopped. Matthew Ryan says, chief global strategy officer at Starbucks, said sales of Starbucks apps will increase further as they recently teamed up with the New York Times, Spotify, and Lyft.

In essence, Starbucks' strategy is to combine its "customer loyalty program" with other different types of services. When using mobile phones, Starbucks users participating in the program can get "stars" in a variety of ways in exchange for free coffee. In other words, consumers can get "stars" through apps other than Starbucks mobile apps.

"We are working hard to make Starbucks stars available to consumers in all areas," says Mr Lane. In other words, consumers can get stars in a variety of different places and use them to return to Starbucks in exchange for coffee. "

This is another channel for Starbucks to attract customers to the store. Caffeine in Starbucks coffee is a big motivation for people to buy their products. In fact, mobile phones have become the "caffeine" in today's social field. In this way, Starbucks has found the secret to making full use of two kinds of "caffeine" to attract customers.

* Source of article: Wired this article is compiled by TECH2IPO / Creative @ Frederick and first published in TECH2IPO / Creative (please keep this information when reproduced by http://tech2ipo.com/)