Starbucks to use Visa's payment service in mobile app

Starbucks has integrated Visa Checkout and paired it with Apple Pay to extend in-app mobile payments capabilities for customers. With more than six million users on the Visa platform, this collaboration looks set to offer customers greater freedom, more options, and enhanced security and efficiency when making payments for products. Michael Becker, Managing Partner at mCordis, the digital marketing strategists, has stated that this move will allow Starbucks to strengthen its position in the global mobile payments market by optimising the lucrative potential of its mobile revenue stream, which is currently driving more than 19% of Starbucks' total sales.

Starbucks is maximizing the number of users on its mobile payments application by extending its capabilities to include Visa Checkout, exhibiting the growth of Visa’s platform.

The coffeehouse chain is hoping to onboard more mobile users on its app through the inclusion of Visa Checkout, as the platform exceeded more than 6 million users over the summer, making it a serious player in the mobile payments game. Starbucks’ powerful checkout feature paired with Apple Pay and Visa Checkout is likely to help continue its stance as a leading retailer in mobile payments.

“The collaboration between Starbucks and Visa Checkout makes a lot of sense,” said Michael Becker, managing partner at mCordis. “The Starbucks Card is a stored value card.

“In order to load money on the card one either needs to hand over cash to the Barista while at a Starbucks, add a gift card to their account or associate a credit card or accepted payment solution like PayPal or ApplePay to their Starbucks account,” he said. “Visa Checkout is an acceptance mark, allowing people to use their Visa Checkout account anywhere the payment method is accepted. By integrating with Visa Checkout Starbucks is increasing available Starbucks Card reloading secure payment options for their clientele.

“They are reducing friction, which is critical in our mobile first world.”

Starbucks steaming up

The beverage retailer updated its mobile app recently, allowing Visa Checkout users to reload their Starbucks’ cards through the payments platform.

For customers looking to order and pay through the Starbucks app, they must reload a digital card which allows them to purchase directly within the platform. Users can now reload their cards through Visa Checkout, Apple Pay or their own debit or credit card.

To reload the Starbucks card users navigate to the pay screen and select reload from there, clicking “pay from” allows them to select which payment method they would like to use. Visa Checkout members can login with their credentials, but will no longer have to again.

The app will save the information and removes the need for customers to have to continually enter their password and log in information. Visa Checkout uses a tokenization, which allows users to save their credit card information within the platform, but prevents hackers from being able to access their code as it assigns it a new number strictly for its program.

Visa Checkout popularity

Fast food chain Taco Bell and books retailer Barnes & Noble College were also among the 33 new merchants that have integrated with mobile-optimized checkout service Visa Checkout, proving that the payments platform sector continues to become more saturated and cutthroat (see more).

Dunkin’ Donuts also confirmed its move into mobile ordering and is introducing an integration with payment platform Visa Checkout ahead of the public rollout, expected to be later this year (see more).

“Mobile is driving a new world of payments and payment options,” Mr. Becker said. “For Starbucks mobile is driving more than 19 percent of revenues and people are loaning the company billions by maintaining a balance on the Starbuck stored value card.

“Visa Checkout is fast, so I would expect Starbucks stored value card reload times to improve for those using the Visa Checkout payment payment option,” he said. “For Visa Checkout, by integrating with Starbucks they are expanding the global reach of their offering through the Starbucks network and increasing the potential reach for their card network and partners.”