Starbucks Mobile Payments Volume Keeps Rising

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Mobile payments now account for over 15% of transactions in U.S. company-operated Starbucks stores, where the company accepts an average of six million mobile transactions every week.

This is a sharp increase from a year ago, when Starbucks reported accepting 10% of its U.S. transactions as mobile payments.

Starbucks plans to push this adoption even higher through a test of a mobile order-and-pay initiative in a major U.S. market later this year, said Howard Schultz, Starbucks' chairman, president and chief executive, in a July 24 conference call to discuss the company's earnings for its fiscal third quarter, which ended June 29.

"We are creating game-changing technologies and experiences for our customers and the opportunity to introduce new lines of business for our company … mobile ordering is just the first of many initiatives in the pipeline," he said.

Across North America, Starbucks has almost 12 million active users of its mobile app, Schultz said. The Starbucks mobile app allows customers to make payments and earn rewards by presenting a bar code to baristas to pay for an order. Consumers can also reload their prepaid Starbucks card accounts by linking a bank-issued card to the app.

The loyalty program, which allows customer to earn "stars" for purchases of Starbucks products in Starbucks stores and grocery stores, has over 8 million active members in the U.S. "The core strength of our loyalty program is fueling adoption of our mobile app," Schultz said.

Starbucks is a pioneer in mobile payments, having aggressively expanded a program it launched five years ago in just 16 of its stores. In January, Schultz handed over many of his responsibilities to COO Troy Alstead, freeing up the CEO to devote more of his attention to expanding Starbucks' mobile payment initiatives.

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