Starbucks Mobile Payments May Give Cause Marketing a Jolt

I love the new mobile payment app from Starbucks. It's great having one less card to carry around (I'm down to a driver's license and a credit card). There's also a total coolness factor, especially when Chris Noble introduced me to the new app several weeks before most people, including most of the staff at Starbucks, knew it was working in stores.

Explaining the technology to the cashier, assuring them it would work if they carefully followed my instructions. Answering the questions of the people in line behind me. I never felt so "in the know" in all my life. God I hope it happens again.

But enough about me.

As Starbucks goes so goes American business. Target has been using this very technology since last February, but I didn't hear about it until the news spread late last year that you could use your smartphone to buy your Starbucks at Target.

This isn't the first time that Starbucks has led adoption.

Starbucks partnership with Product Red put cause marketing on display like no other brand ever did, including the Gap and Apple, and drove the popularity of cause marketing to new heights.

Again last year when Starbucks began offering specials through Foursquare it modeled a new idea for all businesses. Whether you were in a Starbucks or near one the "Specials" banner was not just an offer, but a pitch for all businesses to try Foursquare.

The next frontier is mobility payments. There's certainly a good chance that many businesses will follow suit, especially larger ones like McDonald's that might already have or can quickly put the infrastructure in place.

Some have pointed out that at face value, mobile payments aren't really that much easier than whipping out your Starbucks Gold Card. True, unless your like me and your iPhone is glued to your hand.

But here's something a plastic Starbucks card can't do: it can't marry sales with location.

Catharine Taylor at Social Media Insider last week wrote about the potential connection between mobile payments and Foursquare.

As Starbucks and Foursquare are already partners in commerce, imagine a default that automatically generates a Foursquare check-in when you transact a mobile payment. No work required. No having to append your location when you tweet, or anything like that. That's exactly what I've been looking for! Being able to check in without doing a damn thing!

Maybe that sounds lazy, but we all know that the less work required by the user, the more palatable something becomes. Not only does the potential of marrying mobile payments to check-ins make this a more popular behavior (or non-behavior, since you're not doing anything), it also makes the road just a little smoother to my inevitable claiming of the mayorship of my local Starbucks, with all of the perks that come with it. Seriously though, making check-ins automatic with mobile payments, for those who opt-in, will obviously drive loyalty programs, including ones targeted to those who frequently publicize they are at a local store, becoming an ad vehicle, if you will. There are more ramifications, to be sure, but that's the primary one that jumps to my mind.

Catharine believes that such a marriage would drive adoption of location-based services like Foursquare [Check out what people said when I asked the question at Quora: "How will mobile payments, like those found at Starbucks, and location based services like Foursquare work together?"]

This would be great for cause marketing in several ways.

  1. As I've posted on before, location-based services are a key part of the future of cause marketing. They can inform, remind, educate and direct consumers. While they will never replace the human touch, they engage and reinforce.
  2. While it may seem lazy to let users check-in to Foursquare when they're making a mobile payment, that doesn't mean we can't push notifications back to them. We can share what causes their check-in supported and what else they can do to help. They can also earn the usual array of badges, incentives and karma points for their efforts.
  3. Mike Schneider and Anne Mai Bertelsen wrote a great post in October talking about location-based data mining from multiple stores.

Take this example: if every day a consumer purchases a latte from Starbucks and then walks across the street to Dunkin' Donuts to pick up a turkey sausage flatbread, both companies could benefit from that information. If many customers display similar habits, Starbucks could add a similar breakfast sandwich to their menu or even discontinue their current breakfast fare at that location. That level of data provides a more holistic view of consumer behavior, and could ultimately help brands become more relevant and timely.

Mike and Anne are really on to something here, and linking mobile payments with location would really boost data collection. Causes would also benefit from the intelligence.

If a consumer supports Conservation International at Starbucks and then shops at a fair trade store and picks up a free-range chicken lunch at Whole Foods, maybe that impacts the types of causes they're asked to support when arrive at the register at Target. Or perhaps a standalone business can use customer check-ins and donations in their area to help it pick an appropriate cause partner for a new program.

Mobile payments and location can also work together in other ways. Purchases on your smartphone, for instance, could guide the shopping and restaurant recommendations you get on your Mapquest directions. Or identify causes on your way to the mall that need something you could buy and drop off on your way home.

Mobile payments and location belong together. And cause marketing belongs with both of them.