Like most of you, I drink coffee. I don’t drink too much, because then, I understand from those that love me most, I am a little hard to take. And probably like you, I have a favorite coffee shop. Problem is, I don’t go there anymore. I don’t go there anymore despite the fact that their latte’s are superior and their service is local and friendly. Nope, I just don’t go there anymore. And it’s all because Starbucks has made it so freakishly easy for me to drink coffee that doesn’t taste as good to me.
…because I can pay with my phone.
And I am clearly not alone. In June, Starbucks reported that 10% of all transactions in store are now done via mobile. In fact, Starbucks is processing more than 4 million mobile transactions PER WEEK. This has doubled since the beginning of the year and more than 10 million people are actively using the Starbucks mobile app. The coffee giant has clearly identified and addressed a customer need. It is worth noting that these massive increases in growth have all occurred at the same time the loyalty program that has shrunk in terms of rewards (No more free syrup?!?).
Starbucks must have seen what consumers want in the marketplace and they have built an innovative tool to accommodate our ever-evolving digitally connected population. What Starbucks is offering to coffee drinkers everywhere is valuable. They are lowering the transaction barrier. Consumers are longing for easy ways to transact, which is why the mobile wallet has such promise.
At one point in our human history, we carried around heavy coins. Blah, heavy! Over time with the advent of the printing press, we replaced coins with paper money. Then, paper money got to be a hassle and we replaced it with plastic. And today, even plastic is one extra thing to carry. Fewer things to carry around appeals to nearly everyone, and over time, our phones and our wallets have gotten on equal footing in terms of importance in our lives. In most urban places, people are on foot or bicycle and they don’t need their wallet because they don’t need their license. When I am walking in my community, I don’t carry my wallet, I don’t need it. But, I NEED my phone. NEED it. It is my news source, people connection and now, my payment method to reach caffeinated nirvana.
If you go into a modern coffee shop you see people from all walks of life, nearly all of them looking at a mobile device. Seeing this, as a marketer, you have to begin to wonder, how can I add value to our mobile-driven culture. Many marketers are looking for ways to increase sales, impact switching and create loyalty. Basically, we all want to sell one more of widget to every customer while getting new customers to switch. Starbucks appears to have done just that. And it seems they did it by fulfilling a need in the simplest way possible. Let me pay with my tether to the world. And give me deals and freebies. In exchange for this, I will spend more money with greater frequency.
Starbucks is offering me something that is more valuable than a superior cup of coffee; they are offering me convenience that fits into my lifestyle. When you are thinking about increasing sales and loyalty, ask yourself how your brand can add value to the customer experience. What tools, habits and trends are most prevalent in your customer base? Form an insight based on these things and then start thinking about ways you can inject value and lower barriers for your customers. Chances are you will see the register ring like never before.