Starbucks App’s Order & Pay Feature Has Great Potential

IMG_0296Last week I saw a leaflet at the Starbucks store that I usually go to. It had an advertisement of “Order & Pay” from your iPhone app and pick up in-store. I have been hearing about this service for last couple of months, but I think it took some time for it to come to Ithaca Starbucks stores. When I thought about this service, two questions came to my mind:

  • Would I have to provide the time by when I can come and pick up the coffee?
  • Or Would the app tell me the pick up time?

These are two different use cases. The first use case looks like the traditional way of booking a cab, when you provide the cab a time to pick you up. The second one is more like an Uber, when you need the cab right now, so the closest one would take your order and provide you a time estimate of its arrival. Assuming that people don’t really plan to have coffee and decide in the instant, and also since there are usually many Starbucks and other coffee shops, the second use case seems to be most probable.

Anyways, I decided to use the “order & pay” the next day when I was half a mile away from Starbucks. When you go to the ordering section of the app, it displays tiles with images of your previous orders, so you can instantly place an order. It also has a browse search bar, where you can go through different types of coffee, other drinks and even food items. It has the default size of Grande for the drinks, but you can change that. After you select the item, on the next screen it tells you the estimated time to pick up from the closest open store, which BTW you can change in case you want to drive to a different location. It also displays your drive time to that store. Finally, you can place the order.

But I have one concern here. The pick-up estimate time is usually in a range, for example 3-8 minutes. Now, if it will take me 10 minutes to reach the shop and the coffee is prepared in the next 3 minutes, then by the time I reach, my coffee might not be as hot as I wanted. It would have been great if they could take into account my arrival time to prepare coffee so that it is as fresh as ordered on the spot. Now, I know many people don’t really care if the coffee’s temperature has dropped slightly, but wouldn’t the experience would be awesome if they could achieve that precise level of timing. I think they are very much capable of actually doing that with the amount of data they are capturing.

Starbucks boasts of 16 million active users on Starbucks’ mobile app, which is probably way higher than any other company’s mobile app in Food and Beverage industry. Also as per the information on one of the TechCrunch post, 20% of all transactions happen through mobile payments and they handle around 9 million mobile transactions every week. So, the estimates for pick-up that they come up with are not random or someone in that particular store enters that value. These estimates are probably the output of analysis of tonnes of data collected from the transactions about the customer traffic in stores during any specific time of the day. I think Starbucks today has tremendous strategic advantage by making serious investments in mobile payments 4-5 years ago. I was looking at the SUBWAY mobile ordering system. They have fixed pick up time of 15 minutes from the time of checkout. You can clearly see that Starbucks will become more and more smarter each day with the amount of data they are collecting about store traffic and customer’s buying behavior. And may be one day they would be so smart that they would finish preparing my coffee just in time as I enter the store 🙂

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