Globally popular coffee chain Starbucks says its ability to thrive in today’s competitive landscape is largely due to its investment in technology.
CEO Howard Schultz anticipated a “seismic shift in consumer behaviour,” which he predicted would “significantly impact traditional bricks and mortar retailers,” as he explained to analysts during a conference call last month.
His company’s app, which handles digital payments, has become very popular among consumers. An amazing 20% of in-store sales in the US are now mobile payments—a figure that has doubled in just two years. Now, Starbucks processes nine million transactions every week.
“Many traditional retailers and consumer brands have responded simply by substantially increasing their digital advertising budgets,” the CEO went on to say, “significantly driving up their cost of customer acquisition.”
Starbucks, meanwhile, took a different approach—which translated to a sales boost of 7% and a customer visit increase of 3% and, most telling, a 28% rise in the number of consumers using Starbucks’ digital tools.
Coffee, it seems, pairs well with tech.