Dive Brief:
Starbucks Mobile Order & Pay customers later this year will be able to use Amazon's Alexa AI platform to initiate voice orders while traveling in Ford cars equipped with Sync 3 infotainment systems, the coffeehouse giant announced at its annual shareholders meeting this week.
Starbucks said it now has about 9 million mobile paying customers, with one in three of those using the Mobile Order & Pay app. The company also said total Starbucks Rewards member spending increased 20% compared to last year, driven by member growth and higher spend per member.
Starbucks also announced the availability of social gifting through Apple’s Messages app with Apple Pay starting next month, in an expansion of an existing platform. Starbucks already offers customers the ability to engage in social gifting through a Microsoft Outlook add-in.
Dive Insight:
The big news out of this particular Starbucks shareholders meeting was supposed to be that it was the last such meeting for Starbucks CEO Howard Schultz before he hands his duties off to Kevin Johnson. But Starbucks is pretty good about packing these meetings with numerous news announcements and updates, and this time was no different.
The plan to enable voice ordering through Alexa while in certain Ford cars is a nice bit of follow-through by Starbucks and Ford after their own recent announcements that they would work with Alexa. First, Ford said it would include Alexa in its car models carrying the Sync 3 infotainment system. Starbucks, meanwhile, announced remote voice ordering and its new Alexa skill at the end of January. Both announcements seemed like set-ups for future, more specific applications, and so now we see other shoes dropping.
At this point, it is not much of a surprise to hear Alexa's name mentioned as the voice-driven capabilities behind a feature for ordering coffee while you're in the car. The virtual assistant is in so many different devices now that we soon won't be able to avoid her — not that we're trying.
The rapid adoption of Mobile Order & Pay since Starbucks launched it last year is encouraging for an entire retail sector that is still figuring ou how to boost its mobile payment usage. Starbucks, as we know now, eventually ran into the problem of this particular app feature being too popular, and causing traffic congestion at the barista counter. Interestingly, there was no update in the statement out of the shareholders meeting on the retailer's efforts to remediate that situation, though we also haven't heard from other sources that it continues to be a problem. In any case, its success reflects a very engaged customer base.
Meanwhile, the expansion of social gifting capabilities looks like the latest way in which Starbucks is leading the way digitally by being aggressive about putting new tools and features into the hands of its customers. No wonder they're so engaged.
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