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Starbucks testing mobile ordering and payment ahead of nationwide rollout next year


The Seattle-based coffee chain is perhaps the most advanced mobile payment company in the country. In its 12,000 US stores, Starbucks processes some 47 million transactions each week. Seven million of those purchases -- some 15% -- are made with the Starbucks mobile application.

The mobile app, which has been available for several years, is part of Starbucks' loyalty program. With each purchase, customers receive stars -- a sort of points system -- that can eventually be redeemed for free drinks after enough purchases have been made.

Customers simply place their order with a barista, open the app on their phone, tap "Pay," and then wave the phone (with a barcode displayed) at a reader by the cash register.

Now, however, Starbucks is looking to streamline the process even further by removing most of the interaction between customer and barista. With a new feature called "Mobile Order & Pay," Starbucks hopes to allow customers to place an order on their mobile device and pay for it before they ever step foot into their local coffee shop.

At busy Starbucks locations, the biggest hold up isn't at the espresso maker or the Frappuccino blenders -- it's at the cash register, where regulars who know their personalized orders by heart mix with tourists who might inspect the menu and need to ask just what a Tall is before placing their order. This leads to longer lines and wait times.

By allowing Starbucks to eliminate this "pinch point," the preordering and prepaying system should speed things up for frequent guests, and perhaps make them a little more willing to stop in to pick up a drink, especially if it's already going to be ready and waiting for them.

"We designed this mobile order-and-pay capability to feel just like a natural extension from an experience perspective," said Starbucks Chief Digital Officer Adam Brotman to WIRED. With seven million transactions a week already paid for within the app, I expect Starbucks' most loyal customers (including my wife, who works less than a block a way from our local store here in Colorado) will embrace a way to skip the line.

In the app, a new "Order" tab will appear once the service rolls out in their area. It will first launch in Portland, Oregon, and then city-by-city across the US throughout 2015.

How Mobile Order & Pay works

To use Mobile Order & Pay, customers may:

  1. Click on the "Order" option at the top right of the screen

  2. Select the food and beverage items to order: Just as in-stores, beverages are customizable, including the option to modify size, number of espresso shots, dairy selections, and more.

  3. Select the participating store for pick up: Approximate wait times will be viewable on the customer's phone prior to selecting store location. Directions will also be available if needed.

  4. Confirm by clicking "Order:" At the time of order, payment is made from the customer's registered Starbucks Card.

  5. Proceed to the selected Starbucks® store to pick up food and beverages: Orders are immediately sent to the selected store where Starbucks partners (baristas) will begin preparing the items.

It's not clear precisely how Starbucks will know when the customer will be in the store, though I suspect it will use GPS locating to get a good estimate (preventing a latte from sitting on the counter too long and getting cold will be key).

Eventually, Starbucks plans to offer a delivery service as well, with orders coming from local Starbucks locations. Starbucks even plans dedicated delivery kitchens in locations like big office buildings. Delivery is supposed to begin rolling out in the latter half of next year.

Starbucks has had huge success with its proprietary mobile payments app, something that other companies with less loyal followers might be hard pressed to replicate. But by providing convenience and loyalty rewards, Starbucks is blazing a path to a mobile payments future.

Would you use the order ahead feature in the Starbucks app? Let us know your thoughts in the comments below.

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