Starbucks innovative value proposition includes the wide variety of mostly coffee based menu along with other types of drinks that catered to the wide range of audience who are willing to pay top buck for the luxurious and relaxed interiors that are the perfect environment for socializing with friends and relax. Starbucks successfully created an aspirational brand that created highly loyal and delighted customers who repeatedly come to Starbucks for the unique experience it is offering. Do you study to learn: If Yes? Then read the lot. Let’s Study: The Case Study of the Starbucks Mobile Payment Application.
How to achieve the SUCCESS of the Starbucks Mobile Payment Application? So read the case, The Case Study of the Starbucks Mobile Payment Application.
Starbucks redefined highly competitive coffee shop business and successfully created an uncontested market by turning the simple coffee drinking experience into a way of life experience by drastically redefining the coffee shop environment by adding music, Wi-Fi, relaxed seating, and luxurious interiors. Till Starbucks disrupted the traditional coffee shop market most of the focus was on the price, location, and quality of coffee shops. Another important aspect that Starbucks focused was on the quality of customer service with an exclusive aim of maximum customer delight and they meticulously recruited and trained the best talent in the industry that has added huge value to their brand reputation.
Starbucks customers loaded more than $1.2 billion on its Starbucks app – that’s more money than some banks! The Starbucks app has strategically outcompeted mobile payment offerings from tech giants such as Apple and Google so far. The reason behind the app’s success is simple: Starbucks combined their gift card and loyalty programs into an app optimized for mobile payment. Instead of trying to keep payment exclusive to a particular phone or operating system or brand. The Starbucks mobile app is widely available on both iOS and Android. Automatically this opens up the potential market share and user base to everyone with a smartphone.
The Starbucks coffee shop for the year has been successfully maintaining its dominant position in the market, although the market is becoming highly competitive with many players offering to offer similar products and services similar to Starbucks. Strong competition has also increased with fast food chains such as McDonald’s and Dunkin Donuts, which now offer premium coffee, threatening market share of established players. To capture its competitive advantage and to create a new value proposition for its customers, Starbucks has started focusing on information technology, mobility and the use of social media in particular. What is the Growth Strategy for Case Study Starbucks?
Such an innovative price proposal by Starbucks is a mobile payment application. Starbucks launched its mobile card app in 16 stores at the beginning of 2009 and after the adoption of the customer, Starbucks expanded it across the nation in the United States. The main feature of the app allows customers to scan 2D barcodes on their mobile device and use them as a store payment. The app is expanding Starbucks’s existing, tangible, prepaid reward cards for loyal customers.
The app is marketed based on its benefits in saving time and facilitating shopping for customers. Starbucks refers to the app as “the fastest way to pay”. With this app, customers can check their balance, reload the card with any major credit card or PayPal, see the transaction, and easily track your stars in the MSR (My Starbucks awards) Can. program. The advantages are speed for consumers and there is a low card in their pocket. Customers using the app can also find a mobile payment Starbucks near their location.
The Starbucks mobile payment system is extremely successful based on the fact that in the US, the US $ 1.5 billion average weekly transactions that are responsible for a full 15% transaction made in US Starbucks-powered stores, many digital wallets Service providers are struggling according to BI Intelligence. The innovative mobile app has digital tipping options, the dashboard is showing current reward or loyalty points level, available points with current transactions, weeks of coffee selection, recent transactions and messages.
The Starbucks mobile payment application can also be integrated with social media sites like Facebook, Twitter, where customers can proudly show their reward level milestones with their friends and family. Important Case Study in Corporate Social Responsibility of Coffee Starbucks. This will further enhance their brand reputation and brand loyalty. By shaking the phone, customers can select the barcode of coffee, which they want to buy and want to pay accordingly. The app is modeled on the social media site interface where customers can see the regular purchase of Starbucks coffee and reward-style history and award points in the timeline.
By developing mobile marketing programs it seems to present a further opportunity for Starbucks to fortify the targeted long-term relationships with its customers. Customers allow Starbucks to gain access to their mobile phones in exchange for improved experience and convenience. Thus, perceived benefits have to exceed perceived risks such as the safety of personal data as well as the security of financial transactions via mobile phones.
Starbucks’ disruptive mobile strategy integrated its highly successful loyalty program called My Starbucks Rewards with payments by customers. Starbucks further incentivizes the customers who habitually buy and pay through the mobile app and more reward points are the award that is redeeming for free drinks and food. The app’s success is not due to the ease of payment with a phone compared to cash or debit or credit card but the fact the customer can see the incentives and rewards he is going to get that will further increase his loyalty with Starbucks. In a way, Starbucks is locking the customer for near future. Starbucks loyalty program was diligently crafted over the years and it has been the best in the coffee shop industry or any other industry. Also, learn about – Market Research Coffee of “Starbucks” Entry into China.
With more than 12 million active users in the United States and Canada, Starbucks has added one more new feature where customers can preorder their coffee using the mobile app and pick up the coffee later. “A prime example of this is our forthcoming mobile order and pay initiative that will allow customers to use their phones and MSR (My Starbucks Rewards) accounts to order ahead of arriving at a store where we plan to pilot in a major U.S. market later this year,” said Howard Schultz, Starbucks CEO.
Customers wanted this functionality of preorder through mobile for the past few years, particularly since the mobile-based cab hailing service Uber huge success. The Coffee company is able to offer this service right now as the company feels its technology and in-store operations are well equipping to handle such requests. Also, expanding the number of drive-through express service outlets that are the best suite for the preorder system. Starbucks is also, talking to partners and other businesses like retail outlets that will also allow the customers to use their mobile application payment system, rewards system, and loyalty programs in non-Starbucks outlets.
Through its mobile payment system Starbucks eliminated the need to carry cash, coin change issues, tipping problems, reduced the time spent on ordering and making coffee, understanding the menu and coffee types, offers and rewards available, raised the customer delight, loyalty and rewards, number of visits, new customers and created a new revenue source for the company, helped in acquiring new customers and also created a uncontested space in the digital wallet market.