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Starbucks Corp. keeps adding digital caffeine to its mobile-payments and loyalty offerings built around a prepaid card. The Seattle-based coffee king on Thursday reported that 21% of its U.S. transactions were paid on the Starbucks mobile app in the quarter ended Dec. 27, up from 20% in the previous quarter and accelerating to 22% in December.
“We’re seeing further acceleration in January,” company president and chief operating officer Kevin Johnson added during a conference call with analysts to review financial results for the first quarter of fiscal 2016.
Starbucks also reported that U.S. and Canadian holders of the prepaid Starbucks Card loaded $1.9 billion into their accounts during the quarter, up 18% from fiscal 2015’s first quarter. One in six Americans received a Starbucks Card during the recent holidays compared with one in seven a year earlier, Johnson said.
A Starbucks prepaid card account can be accessed through the Starbucks mobile app, and customers who belong to the My Starbucks Rewards loyalty program can redeem points and offers through it for perks such as free drinks or food. The program claimed some 11.1 million active U.S. members in the first quarter, up 23% from a year earlier.
One of Starbucks’s newest initiatives is the Mobile Order and Pay program, which the company took national in September after tests. The service enables a customer to order a drink or food and pay through the app ahead of pickup. More than 1 million U.S. customers used the service in December.
“We are now processing over 6 million Mobile Order and Pay transactions per month,” said Johnson, adding that in some of the busiest stores, the service accounts for 10% or more of transactions.
Starbucks has big plans for Mobile Order and Pay. Delivery options are being tested in Seattle and New York City. More personalized offerings for users are in the works, which the company hopes will drive more sales. Mobile Order and Pay also is going global; Starbucks in September said it would come to Canada and the United Kingdom, and more countries will be added. “We have just scratched the surface,” said Johnson.
Starbucks also plans to beef up its digital offerings in order to strengthen ties with customers, particularly mobile-oriented Millennials. On Tuesday it announced a deal with the music-streaming service Spotify in which iPhone and Android users of the Starbucks mobile app can discover and save the music playing in Starbucks stores, and play that music anywhere they have access to Spotify.
