Leading Digital_ Turning Technology into Business Transformation ( PDFDrive )

38 LEADING DIGITAL
Keeping pace with advances in mobile technology, Starbucks
has continued to expand its mobile payment capabilities. In 2012, it
announced that customers would be able to make payments at the register
via Square—an app-based mobile payment system—following a
$25 million investment in the service. 22 Starbucks has also enabled integration
of its application with Apple’s native Passbook feature, which
consolidates ticket, coupon, and loyalty card information on an iPhone
or iPod Touch for convenient access.
Mobile payments at Starbucks have been a success for customer
convenience, but they are proving to have financial benefits as well.
Processing fees for transactions through its mobile app and Square have
been substantially reduced. With over three million mobile Âpayment
transactions per week in 2012, the mobile-payments introduction has
significantly reduced transaction fees. 23 The reduction benefits both
coffee drinkers and Starbucks.
Starbucks has also built a leading presence in social media. By 2012,
the company’s 54 million Facebook fans, 3.4 million Twitter followers,
and 900,000 followers on Instagram earned Starbucks a number one
ranking among socially engaged companies.
Digital Masters like Starbucks do not just invest smartly in technology
and channels. They maximize these investments by optimizing
their marketing media mix. Burberry took the plunge by redirecting
a substantial portion of its annual marketing budget to digital media.
Procter & Gamble, the consumer products giant, is investing almost a
third of its media spending on digital, social, and mobile. 24 Not a small
decision from one of the world’s biggest advertisers! Not all companies
have to be that bold. Research firm Gartner estimated that on average,
large US companies spend about 25 percent of their marketing budgets
on digital. 25 Whatever the amount, a rebalancing is needed if a firm is
to get full benefits from the increased channel reach.
The social media presence of Starbucks has earned the company
more than just fans. The company also uses social media to fuel
customer-driven innovation. Through its My Starbucks Idea site,
Starbucks has collected more than 150,000 customer-submitted ideas to