How do you pay for your lattes? Starbucks says customers increasingly use mobile phones

Starbucks customers are increasingly paying for their coffee drinks and snacks with their mobile phones. The Seattle coffee retailer said today that it has processed some 26 million mobile transactions since launching the mobile payment service in January.

And the buzz appears to be growing. Adam Brotman, senior vice president and general manager of digital ventures at Starbucks, said that they processed six million mobile transactions during the nine-week period ended November 30th. That compared to three million transactions during the first nine weeks of the program earlier this year.

Users of the Starbucks’ iPhone and Android apps (sorry, no Windows Phone yet) load cash onto their phones and then pay by scanning the device at retail locations. In essence, the mobile apps can serve as a replacement of plastic gift cards.

For the fiscal year ended September 30th, Brotman said that customers loaded over $2.4 billion onto gift cards. Of that amount, more than $110 million was loaded via the mobile apps.

Adam Brotman

“Even less than a year in, we are seeing significant adoption of the mobile apps for doing everyday transactions, not just payment but reload,” said Brotman. He added that a number of customers also have begun to take advantage of a new eGifting feature in the apps,  which allows customers to send an electronic gift card to a friend, family member or co-worker.

Based on the success, Brotman said that the company plans to roll out mobile payment to 700 store locations in the United Kingdom in January. It also just recently expanded the program in Canada.

In addition to mobile payments, Brotman said they continue to evaluate mobile drink ordering, a frequently requested feature from Starbucks’ customers.

“There are a lot of factors in mobile ordering that are not just about the technology, but also about the operations,” Brotman tells GeekWire. “It is something that our customers have asked us for, so we talk about it every day.”

The top U.S. cities for mobile payments at Starbucks include New York, Seattle, San Francisco, Chicago and San Jose.

I’ve used the Starbucks’ mobile payment feature a few times in the past. Have you? If so, did you find it easier to use than cash or a plastic gift card?

Previously on GeekWire: Bring your coffee cup to life this holiday season with Starbucks new iPhone app

  • kmansel

    Where is the WP7 app?  :/

    • johnhcook

      I did ask Brotman whether they have a Windows Phone app in the works, and here’s what he said:

      “We are closely monitoring Windows Phone, and it is an impressive platform, obviously, and it is something that we are going to continue to evaluate, and listen to our customers around.”

  • Jbs2886

    Just switched to WP7.5 from a BlackBerry. Very frustrating there is not a Starbucks app. MSFT needs to help them launch one asap.

  • Guest

    Congratulations to Starbucks on having made these advances! I already get by without carrying cash, and I have informed my favourite merchants that by the end of 2013 I expect them to have implemented mobile payments so that all I need to carry is my phone. Same goes for my various locks: they should be controlled with apps, not with keys.

    It’s 2011, people. Why should I have to carry a set of keys, a phone, a firearm, AND a wallet when all I need are my phone and my firearm?

  • http://twitter.com/kenmoss Ken Moss

    I feel like I’m about 1% of those transactions myself :-)  I love the app and hate paying any other way.  Starbucks also did a great job on their “Magic Cup” app where you can bring to life characters found around their store.  Can’t wait to see what’s next…

  • Anonymous

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  • Plastic cards

    Great app. I now carry fewer  plastic cards.     

  • Sara

    This app is pretty much the reason why I go to Starbucks now.  It’s convenient, and I don’t have to remember my punch card (as with other shops) to get benefits.  I have noticed that some Starbucks are more set up/used to customers paying via this method than others – with some places you have to read them the numbers; one place refused to take it through the drive through when it was raining (they gave me the drink for free, so ok).

  • http://www.facebook.com/people/James-Stein/100001560647708 James Stein

    Starbucks’ mobile payments program has been a great success for the company, but is it really all that consumer-friendly?  After all, customers can only link their phones to a Starbucks prepaid card and then use the service only at Starbucks stores.  What would happen if every retailer took the same approach?

    I mean, would we want in the not-too-distant future to be using a separate app for each retailer and provide them personal information over and over again?  Wouldn’t it be far safer and more convenient to have one or two mobile payments accounts with providers of our choosing and use whatever payment method (credit cards, debit cards bank accounts, etc.) we may feel like?  http://blog.unibulmerchantservices.com/why-starbucks-platform-is-not-the-best-way-forward-for-mobile-payments

  • Annoyed Barista

    Ugh, I’m a barista there and I hate that app with a passion. It’s so much slower than a card swipe even when they don’t scan too early and screw up a drink order I’m keying in