Mobile
payments service Square has introduced a new consumer app for ordering ahead via smartphone from local shops, cafes and restaurants that use the company’s point-of-sale (POS) software. The new
Square Order app for iOS and Android is rolling out initially with a small number of businesses in San Francisco and New York.
At the same time, Square has pulled Square Wallet from the Apple and
Google app stores. Launched three years ago, the service allowed users to pay participating merchants via mobile device by checking into a location and then simply saying their name to a cashier at
checkout.
But like other mobile wallet offerings, Square Wallet struggled to gain traction with consumers who still find it simpler to pay with plastic. Not even a high-profile
partnership with Starbucks was able to ensure its success. That's partly because the coffee chain already has its own app for in-store payments that also ties into its loyalty program.
With
Square Order, the company will now try to lure users with the ability to skip waiting in lines at local shops and restaurants by placing orders and paying ahead of time. The new app debuts a couple of
weeks after Square introduced a new feature on the merchant side enabling
order-and-pickup service that charges business 8% per transaction.
“We want to make it really clear to people looking for Square in the App Store that Order is where we see the
future,” Square's Arjit Varma told Re/code.
A Square
spokesperson on Monday said the company will continue to support Square Wallet for existing users before eventually migrating them over to Square Order. She added the new app includes the same
pay-by-name functionality as Square Wallet for in-store purchases.
But Square faces plenty of competition from other apps that power mobile ordering from PayPal and Tapingo to GrubHub,
Seamless and Groupon. Chains like Starbucks, Burger King, Chipotle and Papa John's also allow food ordering through their own apps. Whether Square can carve out a niche for itself on the consumer side
is still an open question.
Bringing on board more merchants will be a key to attracting users, but the 8% fee for pickup orders -- versus the 2.75% Square typically charges for credit card
purchases -- may give pause to some business owners who are considering the option.
Square Order appeared in the Apple and Google app stores Sunday without any formal announcement by Square,
indicating that it may want to keep expectations down after what happened with its wallet app. But the company earlier this year ran TV spots pushing its POS system for merchants. Eventually, it might choose
the same tactic to boost awareness of Square Order among consumers.