By Rob Stringer, VP of Product Development & Marketing, Cortex MCP
For all those payment folks that think they can replicate the success of the Starbucks mobile payments application, I have one thing to say. You can’t, unless you can replicate this.
I visited my local Starbucks this week and asked about the company’s new Limited-Edition Sterling Silver Starbucks card (which comes, of course, with its own red snap pouch). It turns out that my store, and in fact, all but one store in greater Boston, has already sold out of this limited edition “jewelry quality 925 sterling” silver card (just in time for the holidays!) Really?
So not only does Starbucks have an enviable mobile payments app, but many of its customers are apparently willing to now pay a premium (a significant $150.00 premium) for one of their prepaid cards? How do they do it? What makes it all so special?
The Starbucks mobile app is really nothing more than the digitization of their pre-existing prepaid gift card. The same rewards are offered to consumers who have a physical card as those who have the mobile app. It’s just that the app lets the customer know about their rewards in a way that a static card cannot, and customers that use the mobile app have been shown to shop 50 percent more frequently than those with just plastic.
The new limited edition silver card works similarly.
Imagine enjoying the benefits of customers who will wait in line to buy your gift card? Not only line up. But also PAY a $150.00 premium to get it. No extra rewards come with it. Limited edition card holders don’t get to skip lines, order ahead, or get their name spelled correctly on their cups. No. Customers are willing to pay extra for a prepaid card because of brand loyalty and affiliation.
Starbucks has built a reputation that brands in nearly every industry and in every corner of the globe admire. And it has gone to great pains to not mess it up when rolling out new technologies and products.
My message to payment companies yearning to replicate the success of the Starbucks app: Start respecting the brand and the retailer. That’s what’s going to drive success in mobile payments and move customers away from plastic.
In a period when we’re all looking at ways to rid our lives of plastic, Starbucks does just that by offering a best-in-class mobile app, AND a card made out of metal.
Hmm, I wonder if next year’s limited edition metal card will be contactless EMV-compliant.
Rob Stringer is the vice president of marketing and marketing development for Cortex MCP. Prior to Cortex, Rob headed up Marketing, Product, and Client Services for ROAM Data. He was responsible for all product roadmaps, marketing initiatives and client engagements for ROAM, helping them secure their series A and B rounds of funding.