Starbucks Corp. expects to complete the rollout of mobile ordering and payment to all 7,400 company-operated locations in the U.S. by the end of September, officials said Thursday.
Mobile ordering and payment will also be available this month to Android users. So far, the ability to order, pay ahead and skip the line has only been available on the iOS operating system.
The update came from Scott Maw, Starbucks chief financial officer, who outlined growth opportunities for the Seattle-based coffee giant at the 22nd annual Goldman Sachs Global Retailing Conference in New York.
Maw said Starbucks is wrapping up its fiscal year, which included significant investments in the U.S. in technology that is paying off with better-than-anticipated results. For the third quarter ended June 28, Starbucks same-store sales grew 8 percent in the Americas region, including a 4-percent increase in traffic.
In July, company officials said mobile ordering and payment accounted for 20 percent of transactions, or about $9 million every week. In locations where it is available, lines are shorter, service is faster and in-store operations are more efficient.
“We know we have a winner, and it’s running ahead of our expectations,” Maw said.
The ability to order ahead and pay via smartphone was first rolled out in December, in Portland, Ore. The feature has debuted in waves since, first to 650 units across the Pacific Northwest in March, and then to 4,000 units across the Sunbelt and Midwest in June.
With each wave, Maw said the company has seen results improve as it gets better at handling the feature operationally.
As Starbucks measures customer satisfaction, Maw said, “there is significant uptick due to mobile order and pay, and we can see it.”
With the rollout, Starbucks has also tweaked various features of the app.
Earlier on, for example, users couldn’t order Clover drinks at their local Starbucks through the mobile app because not all units have the machines to make those beverages.
Now the app allows for more customization by location for products that might be unique to a specific unit, Maw said.
The next step is to move into delivery, which is expected to launch in 2016. Units in New York and Seattle will start testing delivery this fall.
Maw predicted the rollout of mobile ordering and payment would also boost My Starbucks Rewards membership. The loyalty program is already related to about 30 percent of transactions.
In 2016, Starbucks plans to add upselling features to the app for loyalty club members. If a user orders an iced tea on the app, for example, a photo may pop up for a panini to go with it, or suggestions might be based on the customer’s previous orders.
Maw predicted that adoption rates would also grow organically as guests try the app and like it. The adoption rate has grown with each wave of the rollout, he said.
“It’s a way to achieve mid-single-digit comps for what we think will be a number of years,” Maw said.
Contact Lisa Jennings at [email protected].
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