Starbucks rolls out mobile pay app in China
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Starbucks this week launched its mobile payment system in China, marking another step forward in two areas the company sees huge growth potential: China and mobile technology.
Customers can now pay for their Starbucks purchases at some 2,200 stores in China by using the Starbucks app on their phone, linked to a pre-loaded Starbucks gift card.
“With the ongoing seismic shift in consumer behavior due to mobile technology, Starbucks is committed to exploring new ways to leverage digital innovations to deliver an elevated Starbucks Experience to our customers,” Belinda Wong, president of Starbucks China, said in a news release.
Starbucks is betting big on China, where the company is adding 500 stores a year. It plans to have 3,400 stores there by the end of 2019.
In June, it opened a store at Shanghai Disney Resort — a location that Starbucks CEO Howard Schultz said earlier this year could become “Starbucks’ highest-grossing retail store overnight.”
In the most recent quarter, Starbucks’ China market saw 18 percent revenue growth — likely due to new stores the company is opening there — and 5 percent transaction growth, according to the company.
The 5 percent transaction growth is the “highest anywhere in the world,” said Scott Maw, Starbucks’ chief financial officer.
The mobile app lets customers in China not only use their phones to pay for their coffee drinks but also manage their Starbucks Card account, find nearby Starbucks stores and track and redeem rewards.
Starbucks’ mobile app has been a big success for the company.
About 21 percent of all transactions in its company-owned U.S. retail stores take place through its mobile app, according to Bloomberg News.
In the U.S., where the company has rolled out a “mobile order and pay” that lets customers bypass store lines by ordering and paying for their drinks ahead of time on their phones, usage doubled year-over-year in the most recent quarter.
Starbucks processes 8 million mobile order and pay transactions per month, the company said.
The company has also closely linked its loyalty rewards program with its mobile app, tying payments made via the app toward earning rewards, and displaying prominently progress made toward earning a reward.
Questions & Answers
Q.What functionality does the new mobile payment app offer customers in China?
What functionality does the new mobile payment app offer customers in China?
The app allows customers to pay for purchases, manage their Starbucks Card account, find nearby stores, and track and redeem rewards. This aims to provide greater value and convenience for users.
Q.How successful has Starbucks' mobile app been in its existing markets, such as the US?
How successful has Starbucks' mobile app been in its existing markets, such as the US?
In company-owned US stores, around 21% of all transactions occur via the mobile app. The 'mobile order and pay' feature saw usage double year-over-year in the most recent quarter, processing 8 million transactions monthly.
Q.What are Starbucks' growth plans for its physical store presence in China?
What are Starbucks' growth plans for its physical store presence in China?
Starbucks is rapidly expanding in China, adding 500 new stores annually. The company aims to have a total of 3,400 stores across the country by the end of 2019.
Q.How is Starbucks' business performing in China, according to the latest figures?
How is Starbucks' business performing in China, according to the latest figures?
In the most recent quarter, the China market reported an 18% revenue growth and a 5% transaction growth. The company noted that the 5% transaction growth is the highest seen anywhere in the world.
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