Starbucks Debuts iPhone Apps, Tests Mobile Payment

Starbucks iphone app

With several unofficial Starbucks-finder apps already populating the App Store, the coffee giant itself has finally hit the iPhone with a pair of apps -- one of which will eventually let customers use the Apple device to pay for purchases.

The new Starbucks Card Mobile App allows iPhone users to check their Starbucks Card balance and reload it with a major credit card. But the company is also testing a mobile payment option that lets people use the app to buy products by swiping an on-screen barcode that is scanned just like their plastic Starbucks Card. The e-commerce feature is currently in trials in 16 West Coast stores.

A second app -- more similar to the unofficial Starbucks iPhone apps -- allows users to find nearby store locations, look up menu and nutrition information and browse its whole bean coffee selection.

It also offers a Drink Builder feature so that people can create and share their own coffee concoctions with friends via SMS and email, or directly to their iPhone or iPod touch.

Starbucks said the new apps reflect input from consumers via, the online suggestion box the company started last year. "We took a pile of great ideas, helpful suggestions, and a bit of wishful thinking and turned out an iPhone/iPod touch app that we think you'll really like," wrote K.C. MacLaren, manager, retail consumer technology, at Starbucks, in an online post.

MacLaren acknowledges that the company is already competing with a bunch of third-party store finders in the App Store. "Yeah, but can they tell you if a store is open? Has a drive-thru? We didn't think so," he added.

So far, customers seem to concur. The myStarbucks app has earned four and a half out of five stars based on 14 user reviews, and the Starbucks Card Mobile app has earned five stars based on 21 reviews in the App Store. "I've been waiting for someone to finally make the most of the iPhone and the potential for mobile payments -- leave it to Starbucks to crack the bean," read one customer review.

Ideas for additional app features continue to be posted on MyStarbucksIdea, however. A number of people proposed combining both apps into one for greater convenience -- a logical step. Other suggestions included offering apps for other types of smartphones like the BlackBerry and Android devices and push notifications when someone is near a Starbucks store.

Starbucks said the new apps are only version 1.0, and welcomes more user feedback to make improvements and add useful features. With regard to promoting the iPhone apps, the company does not appear to have launched any major campaign to build awareness. Starbucks has posted a YouTube video touting the new apps, and had a Twitter post about them Tuesday.

Eric Litman, chairman and CEO of mobile ad company Medialets, said even a well-known brand like Starbucks must get the word out on new apps. "No matter how significant the brand, the sheer volume of apps in the App Store demands real promotion of an app," said Litman, who appeared on a panel at the Apps for Brands conference in New York Wednesday. "The best channel for that is in-app advertising with targeted mobile Web ads as a close second."

Sitting on the same panel, Ed Kaczmarek, director of innovation, new services at Kraft Foods, also endorsed in-app advertising in helping to promote its company's popular iFood Assistant app for the iPhone. But he also emphasized the importance of word of mouth, which he described as among the least expensive marketing vehicles, but probably the one "that takes the greatest amount of work."

Starbucks did not respond to a media inquiry before deadline Wednesday about its plans to promote the apps.

3 comments about "Starbucks Debuts iPhone Apps, Tests Mobile Payment ".
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  1. Howie Goldfarb from Blue Star Strategic Marketing, September 24, 2009 at 3:23 p.m.

    This is an excellent mobile success story for the most part. The lacking part obviously is what will it take for anyone who has a mobile device to use such applications.

    As for the push declarations when you are near a store....I run in fear. First off if many brands/retailers do this we will receive a lot of hits when driving or walking around....most likely way too many. And if every push notification was a coupon that would be totally rad but after 2 or 3 non-fat iced mochas my limit would be reached. I think best strategy is to get people used to using the app everytime they want coffee and if you really want location based should send your order and process your payment when your 2 mins away from the Starbucks...AND it needs to include a way to tip.

    Starbuck's worst thing they ever did to their baristas (but great for starbucks) were the credit and starbucks card transactions because most people using those types of transactions do not tip which lowered their pay. Nothing like a rich person driving a Mercedes being cheap after spending $6 on a specialty coffee.

  2. Dean Collins from Cognation Inc, September 25, 2009 at 10:28 a.m.

    JC Penny and Starbucks implementing QR codes in the same week. Can we finally consider QR codes mainstream in the USA now?

    Dean Collins

  3. Dean Procter from Transinteract, September 28, 2009 at 8:36 a.m.

    While I admit to being a mobilisation evangelist it'll take a little more that a double espresso and four sugars to get me hyped up about this one.
    Back in school I studied something called mathematics and then later marketing and I retain from that 'share of wallet'.
    Now using mathematics and share of wallet I figure that the business model which relies on consumers storing value ie, putting their hard earned cash into every store's card, along with the tollway, transport tickets and now Starbucks - is a dead-end model. Has anyone else thought about this without the hype?

    The other mathematical thing that occurs to me is 'how many apps can you possibly fit on an iphone? Ok so its infinite, doesn't that mean it'll eventually be a pain in the eye for the consumer shuffling through all those apps, because after all the maths says they all can't be in the front of screen and mind all the time.
    I can of course see the wildly optimistic scenario that I can only assume has been presented to get this sort of thing wings.
    On another level it is of course only a little spend on spin after all.

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