Starbucks has grown from a mere coffee roaster to a tech-loving brand, with initiatives such as free Wi-Fi services, its partnership with Apple’s iTunes Music, the eGift cards or wireless charging — all working to its favor. With more than 14 million active members, the company’s mobile app is booming.
Mobile Order & Pay was introduced to help customers avoid long queues. The rising popularity of the mobile app did hurt Starbucks last year as it struggled to keep up with the mobile orders. There was overwhelming foot traffic at a few stores — resulting in despair drove away quite a few customers. Despite this hiccup, the coffee giants picked itself up and ever since, mobile ordering has been on the rise.
The company finds it more effective to target new products to its customers via its app. The company aims at expanding its footprint in China by opening over 5000 stores by 2021. The company hopes that China will overtake the U.S. as the largest market.
During the first quarter this year, the company reported a 2% increase in its comparable store sales. Comp stores in Americas and U.S. rose 2%, much lower when compared to China that reported a 6% jump. Mobile Order & Pay accounted for nearly 11% of its total transactions in the U.S. during the quarter.
This new strategy seems to have worked like a charm, and we will soon see the coffee giant double down on the Chinese market using the app. While mobile ordering will help the brand get back to its pace back home, it is the new markets that could benefit the most from this.