The novelty of paying at Starbucks with a mobile phone isn’t wearing off, apparently.
Especially in cities with a high concentration of smartphone-toting coffee lovers.
At the end of the program’s first year, usage is actually surging ahead, according to Adam Brotman, senior vice president and general manager of Starbucks digital ventures.
In the last nine weeks Starbucks handled 6 million mobile payments, double the volume of the first nine weeks after the system launched in January. Altogether it has handled 26 million mobile payment transactions since launch.
“We’re excited to see the quantity of transactions but more importantly we’re excited to see it accelerate,” Brotman said during an interview, providing an update on the first year of the nation’s largest mobile payment program.
Brotman said the highest usage of smartphone payments at Starbucks is in five cities: New York, Seattle, San Francisco, Chicago and San Jose, Calif.
The growth of the system was helped by overall gains in smartphone usage and consumers’ growing comfort with mobile payments.
Two-thirds of the nation’s 90 million smartphone owners used their devices for shopping activities in September, and 38 percent had used the device to make a purchase at least once, according to a new report from comScore. Among people using their smartphones for shopping, 31 percent used it for non-grocery food purchases, the firm found.
Starbucks is also seeing increased use of its mobile apps because they’re linked to its hugely successful Starbucks Card loyalty program.
Mobile payments are also reaching more customers; after initially launching in around 7,000 company stores and outlets within Target stores, the mobile payment program now reaches 10,000 stores in North America, including Safeway Starbucks stores and company operated storees in Canada.
Lately growth has also come from “mobile gifting” using the “eGift” capability of the company’s iPhone app. Brotman said mobile devices now account for 10 percent of the company’s digital gift card business.
Next up is expansion of the mobile payment program to more than 700 Starbucks stores in the United Kingdom starting on Jan. 5.
The apps are available for Android and iOS. Brotman said he’s watching the progress of Windows Phone and “very impressed” by Kindle Fire, but there’s no word yet on apps for those platforms.