The Success of Starbucks App: A Case Study

Updated May 12, 2023 

A recent study found that Starbucks has the most regularly used loyalty rewards app (48%) among a list of major restaurant chains. Why is the app so popular? What is it that keeps users coming back for more?
 
The answer is digital engagement.
 
From ordering and paying ahead of time to creating your own Spotify playlist, the Starbucks app provides a user experience that is both inviting and innovative, much like the coffee chain itself.
 
That digital engagement has paid tremendous dividends for the company. At a JPMorgan forum in March, Starbucks CFO Scott Maw said almost all of the company’s same-store sales growth has come from customers that have digital relationships with the company and those that are in the Starbucks Rewards program. 
 
This case study will discuss four main reasons why the Starbucks app is a “must have, must use” app for customers:

• Easy Navigation
• Personalization
• Geo-location
• Mobile pay and ordering
• Integration with other platforms and services

1. Easy Navigation

The app's layout is simple, yet elegant, making the app appealing to the user. However, the platform's navigation is what makes it stand out. Navigating through the Starbucks app is quick and easy, making it conventient for users to place an order. 

Five menu options at the bottom of the app page give the user access to the major functions: Home, Scan, Order, Gift, and Offers. Having the menu at the bottom of the screen makes it easier for users to access the most important pages on the screen because it's well within reach of a user's thumb. 

Additionally, the Starbucks app is exceptionally innovative because it provides a similar experience to visiting the store. Many of us have stood in line at Starbucks thinking, “I should get a gift card for (insert person/occasion).” The Gift menu brings up a variety of gift cards for nearly every occasion, and even suggests cards for upcoming holidays.
 
Starbucks added the convenience functionality despite the risk of placing too many “bells and whistles” in the app. Chief Digital Officer Adam Brotman acknowledged that the company didn’t “want the app to become too much of a Swiss Army knife.” 

However, the innovative features have been well received and have not overwhelmed users. The Starbucks app provides its users with a personalized experience. 

2. Personalization

Starbucks added personalization elements allowing the app to recall your favorite order, suggest what food items might pair well with that order, and where you’d like to pick it up.  Again, this simplifies the user experience and makes it especially easy to place an order. It keeps track of what you've ordered in the past and your favorite drinks to ensure that it's easy for users to place their order during their morning commute. 

3. Geo-Location

There are Starbucks everywhere, so it's important for users to be able to select which one they wish to visit when they place an order. The app uses geo-location to show where each storefront is located and how close a user is to each one. 

Using the geo-location feature, a user can see where the closest Starbucks locations are, the menu at each location, and even place an order that can be ready upon arrival. 

 If you often order from a specific location, the app will automatically select that location, limiting the number of clicks a user has to make to place an order. 

4. The Starbucks Rewards Loyalty Rewards Program Leads the Competition

The Starbucks Rewards program is a prime example of how to get customers to utilize a mobile app. Simply put, the more you spend at Starbucks, the more rewards points (or “stars”) you earn. Not only is this great for users on the app, but it also helps foster brand loyalty. With the promise of rewards, users are more likely to order from Starbucks in the future. 

The rewards program gives a number of benefits for app users. In addition to earning two stars for every dollar spent, rewards members get other benefits like free in-store refills, special member offers/events, and the ability to pay by phone and order ahead.

The rewards program also offers plenty of customization for users, including a free beverage on the user’s birthday and personalized suggestions based upon past orders.
 
In return, Starbucks solidifies an instant digital relationship with the 14.2 million active U.S. rewards program members. The loyalty program has seen hefty growth, with an 11% growth in users in Q2 2018. And Starbucks rewards program members in certain places actually spend more, representing 39% of the entire chain’s sales.
 
However, Starbucks recognizes that not all customers want to join the rewards program. Starbucks is planning to ramp up digital interactions by offering mobile order and pay options to all customers—not just rewards members. The company also will take advantage of Wi-Fi sign-ins at various stores to help drive mobile order and pay options. 
  
The Starbucks rewards program encourages users to utilize the app to track purchases, as well as the stars earned. To facilitate their usage, stars have a limited shelf life—one year for basic (or “Green”) level rewards customers, and six months for upper-tier (or “Gold) members.
 
The app provides reminders about stars that are expiring, as well as the number of stars needed to maintain Gold status. Gold members also get special double-star days when they earn four stars per $1 spent.

5. Starbucks’ Mobile App Makes Online Ordering and Paying Easy

Since launching the initiatives in 2015, Starbucks has become the standard bearer when it comes to mobile ordering and payments. Mobile Order and Pay is a feature that let customers order via Starbucks’ app and skip the line.
 
At first, the growth of Mobile Order and Pay caused some congestion issues inside stores for customers while picking up their coffee and/or food. As one customer stated, “Why should I order ahead if I just have to stand in line to retrieve my order?” 

Starbucks responded by adding dedicated stations for mobile order-ahead customers, distinct from existing in-store registers, and giving baristas new tablets.
 
The mobile ordering system acts as a digital marketing tool, allowing customers to see new items ahead of time. Coupled with notifications from the app or email blasts, Starbucks creates interest in new menu items long before the customer sets foot in the store. Often, these digital tools create a sense of urgency for customers to sample the latest offerings.
 
Starbucks also enabled orders via Amazon's Alexa, and the feature has also been integrated into Ford vehicles.
 
The coffee chain also expanded its My Starbucks barista, a feature integrated into the Starbucks app, which allows customers to order via voice command or messaging. The goal was to boost speed and convenience.
 
In-store payments are also encouraged through the app, which utilizes a Starbucks gift card to process the payments. This creates seamless transactions, as the gift card can be automatically or manually reloaded using a credit card, Apple Pay or Google Pay, or even with the balance from another gift card. The app screen can be scanned at the register to process the payment.
 
For iOS users, the app integrates with the Apple Watch, producing a bar code that also can be scanned for those on the go.

By offering a wide variety of functionalities, Starbucks’ Mobile Order and Pay allows users to order and pay in the way that is most convenient for them – which encourages greater sales.

Starbucks’ App Exemplifies Loyalty App Success

The Starbucks app is the center of the company’s digital ecosystem, bringing together loyalty, mobile payment, and content partnerships, all seamlessly integrated into one convenient application. 
 
Restaurants can follow Starbucks’ example to create a successful restaurant loyalty rewards app.