Starbucks app ahead of Apple Pay in U.S. mobile payment user adoption

Posted:
in General Discussion
Starbucks may be leading Apple in the U.S. mobile payments market with the coffee chain said to have more users who made a payment using its app than Apple Pay.




While Apple has made strides in turning Apple Pay into one of the dominant mobile payment platforms, leading ahead of both Google Pay and Samsung Pay, research from eMarketer indicates Starbucks continues to have a higher number of active users in the United States.

According to estimates of mobile phone users aged 14 or older who have made at least one in-store mobile payment in the previous six months, approximately 23.4 million people in the U.S. will use the Starbucks app to make an in-store purchase by the end of 2018. By comparison, Apple Pay will be used by 22 million people, while Google Pay and Samsung Pay will have 11.1 million and 9.9 million users respectively.

Starbucks is thought to continue leading over its rivals for a few more years, reaching an estimated 29.8 million U.S. users by 2022. Apple Pay is predicted to follow behind at 27.5 million users, Google Pay will stay in third with 14.9 million users, and Samsung Pay will lag behind with 13.2 million.

The estimates are notable in that the Starbucks app will only work for in-store purchases and pick-up orders at Starbucks stores, not with other retailers, while Apple Pay and its competitors are available for use in a far larger number of outlets. The Starbucks app does also benefit from it being available across both iOS and Android devices, unlike Apple Pay's in-store component being limited to iPhones, Google Pay to Android devices, and Samsung Pay only to Samsung-produced smartphones.

It is claimed by eMarketer that Samsung Pay is in fact the most widely accepted payment system, usable by around 80 percent of merchants, but its restricted availability to Samsung devices simultaneously limits its utility. By contrast, Apple Pay is said to be accepted at more than half of US merchants.

"The Starbucks app is one of the bigger success stories in mobile proximity payments," eMarketer analyst Cindy Liu suggests. Noting the ties to Starbucks' loyalty rewards program, Liu adds "for users of the app, the value of paying with their smartphone is clear and simple - you can save time and money at the register, all while racking up rewards and special offers."

Apple is continuing to cement Apple Pay's position as the main mobile payments platform, expanding the service to include cards from more banks and credit unions over time, both in the United States and abroad. As part of the most recent quarterly financial results, Apple CEO Tim Cook advised Apple Pay has doubled its global active users year-on-year, and tripled the number of transactions.
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Comments

  • Reply 1 of 68
    SoliSoli Posts: 10,038member
    1) Not surprising at this time. If you use Apple Pay and you go to Starbucks you're probably using the app to both pre-order and to reload your card on the app via Apple Pay. Those points add up.

    2) I doubt their growth is sustainable, but *Pay adoption will continue to grow as vendors accept Apple Pay (or vendors realize they've been able to accept Apple Pay ever since the got a chip card reader).
    brad6788watto_cobra
  • Reply 2 of 68
    nunzynunzy Posts: 662member
    Apple has nothing to worry about. They probably make more profit from Apple Pay than Starbucks makes from their entire business.
    edited May 2018 baconstang
  • Reply 3 of 68
    rob53rob53 Posts: 3,257member
    Soli said:
    1) Not surprising at this time. If you use Apple Pay and you go to Starbucks you're probably using the app to both pre-order and to reload your card on the app via Apple Pay. Those points add up.

    2) I doubt their growth is sustainable, but *Pay adoption will continue to grow as vendors accept Apple Pay (or vendors realize they've been able to accept Apple Pay ever since the got a chip card reader).
    I keep telling merchants this but it’s the owners that don’t want to do anything about it. I guess it’s too technical for them. 
  • Reply 4 of 68
    cjaercjaer Posts: 14member
    I've gotten free credits at Starbucks that required me to load into the app, which prompted me to install and register it.
    Not a huge starbucks fan, but my yearly spend there is probably ~$20.

    I use Apple Pay quite a bit. Even would say that those grocery stores that don't accept it now get much less of my business and I'm anxiously awaiting gas station adoption.
    My yearly spend right now is ~ $5,000 and increasing.

    Obviously this is statistically irrelevant, however I think it's illustrative that when numbers like those in the article are posted they certainly don't tell the whole story. I count as one registered user for each platform, but not all users are created equal.


    edited May 2018 watto_cobra
  • Reply 5 of 68
    SoliSoli Posts: 10,038member
    rob53 said:
    Soli said:
    1) Not surprising at this time. If you use Apple Pay and you go to Starbucks you're probably using the app to both pre-order and to reload your card on the app via Apple Pay. Those points add up.

    2) I doubt their growth is sustainable, but *Pay adoption will continue to grow as vendors accept Apple Pay (or vendors realize they've been able to accept Apple Pay ever since the got a chip card reader).
    I keep telling merchants this but it’s the owners that don’t want to do anything about it. I guess it’s too technical for them. 
    Get three stickers that Apple gives out and then give them the stickers or just start putting on the doors/windows and registers of those that take Apple Pay.
    watto_cobraclaire1
  • Reply 6 of 68
    jmey267jmey267 Posts: 57member
    Um so Apple is the leader in mobile pay not Starbucks. I cant use my Starbucks app to pay at my drug store or any other store other than Starbucks. This is kinda of a stupid comparison, no?
    mark fearingtgr1jasenj1razorpitbaconstangwatto_cobra
  • Reply 7 of 68
    coolfactorcoolfactor Posts: 2,259member

    Here in Canada, we have broad support for Apple Pay, but I've only used it once in the past year. Maybe pulling out the wallet that's always with me is a hard habit to break?

    Now if only we could load our driver's license onto our phones and have that be valid ID, then we're talking! That's pretty much what keeps my wallet with me at all times. Payment cards are secondary.
    baconstang
  • Reply 8 of 68
    kjcomegakjcomega Posts: 2member
    Hey,

    I'm not fond of this sort of comparative analysis, given that Apple Pay is like a debit card that can be used anywhere with a compatible payment system. Starbucks app? It's a loyalty and rewards system that only works at Starbucks. Quite different. Lastly, I use Apple Pay to add money to my Starbucks app. 

    That said, Appleinsider has distinguished itself with lucid analysis, and excellent writing. I'm just not sure that this bit of news makes much sense.



    slprescottjasenj1baconstangwatto_cobra
  • Reply 9 of 68
    I use the Starbucks app - at Starbucks- because of the rewards. I use Apple Pay at places other than Starbucks. So I'm not sure I understand the comparison being made in this piece either.
    mike1watto_cobra
  • Reply 10 of 68
    MacProMacPro Posts: 19,758member

    Here in Canada, we have broad support for Apple Pay, but I've only used it once in the past year. Maybe pulling out the wallet that's always with me is a hard habit to break?

    Now if only we could load our driver's license onto our phones and have that be valid ID, then we're talking! That's pretty much what keeps my wallet with me at all times. Payment cards are secondary.
    "Maybe pulling out the wallet that's always with me is a hard habit to break?" So I guess the Scots use Apple Pay a lot more than most then ;)
    watto_cobra
  • Reply 11 of 68
    cjaercjaer Posts: 14member

    Here in Canada, we have broad support for Apple Pay, but I've only used it once in the past year. Maybe pulling out the wallet that's always with me is a hard habit to break?

    Now if only we could load our driver's license onto our phones and have that be valid ID, then we're talking! That's pretty much what keeps my wallet with me at all times. Payment cards are secondary.
    I have one of those cases that allows you to hold about three cards. My ID and a couple credit cards are always with my phone, and I always fold a $20 tucked between the case and the phone, which comes in handy more often than I would have guessed. Totally agree on wishing you could have valid ID on your phone though. 

    I also use an app called stocard (I think that's it) that allows me to put in my library, loyalty, health insurance and other cards in electronically. That plus what I described above keeps my wallet at home most of the time.

    The one thing about Apple Pay, in addition to the convenience, is the security. I really, really like having merchants not have access to my credit card number.

    edited May 2018 tgr1watto_cobra
  • Reply 12 of 68
    rob53rob53 Posts: 3,257member
    Soli said:
    rob53 said:
    Soli said:
    1) Not surprising at this time. If you use Apple Pay and you go to Starbucks you're probably using the app to both pre-order and to reload your card on the app via Apple Pay. Those points add up.

    2) I doubt their growth is sustainable, but *Pay adoption will continue to grow as vendors accept Apple Pay (or vendors realize they've been able to accept Apple Pay ever since the got a chip card reader).
    I keep telling merchants this but it’s the owners that don’t want to do anything about it. I guess it’s too technical for them. 
    Get three stickers that Apple gives out and then give them the stickers or just start putting on the doors/windows and registers of those that take Apple Pay.
    I have told them they can get a free sheet if stickers from Apple but most haven’t the faintest idea what I’m trying to do with my phone even though android phones can do similar payment techniques so it’s not just Apple Pay they don’t understand. 
    watto_cobra
  • Reply 13 of 68
    urashidurashid Posts: 127member
    jmey267 said:
    Um so Apple is the leader in mobile pay not Starbucks. I cant use my Starbucks app to pay at my drug store or any other store other than Starbucks. This is kinda of a stupid comparison, no?
    There can be multiple ways of defining the "leader."  This article is comparing active users, saying there are more active users of Starbucks payment app than Apple Pay.  This is remarkable considering Starbucks app can only be used at Starbucks stores while Apple Pay is accepted at a gazillion locations.

    Personally, I have only used Apple Pay once in the last 12 month, and that too at the insistence of the checkout guy at Apple Store.  I get no extra benefit by using Apple Pay over my credit card, while with Starbucks app I get to skip the wait, earn free drinks, etc.
  • Reply 14 of 68
    If this doesn't prove to you that the rollout of ApplePay has been a failure than you're in denial.

    ApplePay is a slam dunk, amazing service: incredibly easy, secure, and even fun to use (people still get excited/wowed sometimes when they see me use it, and I try to use it every chance I get).

    One merchant, selling one type of product, should not be beating ApplePay in use.

    Even if ApplePay doesn't make a lot of money, it's such a fantastic add on to the Apple ecosystem that its tragedy that Apple hasn't been promoting it enough or promoting it effectively.

    There's failure on the consumer and merchant side. Most people I meet are highly skeptical of the security, and the vast majority of merchants either don't have the capability, or don't have it turned on, or don't even know it's available on their system.

    Yet Apple seems content to console themselves with bs, like the report that came out from an apple pay exec that it's available with 50% of merchants. Right..

    So frustrating both as an Apple consumer and as an Apple fan.

    Edit: In case it's not clear, this isn't about ApplePay vs starbucks (apples and oranges). This is about what this info tells us about ApplePay's rollout, which isn't good.
    edited May 2018 crabby
  • Reply 15 of 68
    rob55rob55 Posts: 1,291member
    I don't frequent Starbucks, but the last time I was there, I didn't think they even accepted ApplePay at the POS terminal. So, I used ApplePay to load up my Starbucks app, and paid with that. Checking Starbucks website, it said they planned a nationwide rollout of ApplePay in 2016, but I don't know how far it progressed. I honestly didn't bother to check before now, and was content to load my Starbucks card using ApplePay. As others have said, the eMarketer research is flawed because I suspect many do as I do, and load the app using ApplePay.
  • Reply 16 of 68
    crabbycrabby Posts: 38member


    patchythepirate is exactly right. Maybe if Apple spent less time roping in yet another bank, but rather just bouht, say , a million POS devices  for the small biz folks out there. Apple Pay works just about perfect- but the number of places for its use does not seem bigger than a year  ago.

    patchythepirateclaire1
  • Reply 17 of 68
    sonnybbsonnybb Posts: 1member
    urashid said:
    jmey267 said:
    Um so Apple is the leader in mobile pay not Starbucks. I cant use my Starbucks app to pay at my drug store or any other store other than Starbucks. This is kinda of a stupid comparison, no?
    There can be multiple ways of defining the "leader."  This article is comparing active users, saying there are more active users of Starbucks payment app than Apple Pay.  This is remarkable considering Starbucks app can only be used at Starbucks stores while Apple Pay is accepted at a gazillion locations.

    Personally, I have only used Apple Pay once in the last 12 month, and that too at the insistence of the checkout guy at Apple Store.  I get no extra benefit by using Apple Pay over my credit card, while with Starbucks app I get to skip the wait, earn free drinks, etc.
    Well if you don’t understand the security benefits of Apple Pay versus regular credit card, of course you won’t used it.
    baconstangtjwolfjmey267watto_cobraGeorgeBMac
  • Reply 18 of 68
    lkrupplkrupp Posts: 10,557member
    I use the Starbucks app for purchases but I use Pay to reload my Starbucks app. So there’s that. 
    mike1watto_cobra
  • Reply 19 of 68
    lkrupplkrupp Posts: 10,557member
    Wait. What? Both Google Pay and Samsung Pay have only half the user numbers than Pay? That’s not what the Google and Samsung fans that post here say. So which is it?
    watto_cobra
  • Reply 20 of 68
    nunzynunzy Posts: 662member
    lkrupp said:
    Wait. What? Both Google Pay and Samsung Pay have only half the user numbers than Pay? That’s not what the Google and Samsung fans that post here say. So which is it?
    Apple doesn't lie. But Google and Samsung?
    watto_cobra
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