Starbucks Orders Double Shot of Square

Coffee giant grows partnership with Jack Dorsey's startup By Christopher Heine

• January 03 2013
• Technology

Photo: Paul J. Richards/AFP/Getty Images

Starbucks is selling Square's mobile card readers for $10 in the coffee retail giant's7,000 locations nationwide, extending the companies' budding partnership. The readers let users accept credit and debit card payments from individuals and are free after rebate.

"We have a lot of small business owners who do business in our stores. So we wanted to offer them the reader for their business needs. And it just seemed like a good natural next step in our relationship with Square," a Starbucks spokesperson told Adweek. 

Indeed, the development comes just two months after Starbucks implemented the tech startup's mobile app-based payment system dubbed Square Wallet in its stores around the country. The iPhone/Android app lets the coffee-drinking patrons make payments by simply saying their name. They can forego using their physical credit card with the app, which bills the person's stored credit card account during a purchase.

In addition to Starbucks, Square Wallet can be utilized by consumers in locations for Walmart, Apple, Target, Walgreens, FedEx Office, AT&T, Best Buy, Staples and Radio Shack. All in all, the San Francisco-based tech firm says it's in 30,000 retail locations.

Also during November 2012, Starbucks disclosed it plans to invest some $25 million in Square—the brainchild of Twitter founder and chairman Jack Dorsey.

Meanwhile, today's news seems to be another notable notch in the belt for Square, positioning itself against increasing "digital wallet" competition from American Express,LevelUp, Google Wallet and others. The companies look to capture a mobile audience by streamlining payments between on-the-go consumers and retailers.

Starbucks Launches Its Square Payments Program Today

11.09.12WRITTEN BY DAN SEITZ

Hey, remember when Starbucks decided it was going to basically step to Apple, Google, and pretty much everybody else in the tech sector when it came to mobile payments? Yeah, that whole fight starts as of today. Here’s what you need to know to take advantage of it, and why so many are so angry.

So, if you want to buy a latte with your phone, and don’t want to use Starbucks’ payment app, you’ll need the Square Wallet app. It’s for iOS 5 and later and Android 2.2 and up. Unlike many mobile payment apps, you won’t need an NFC card or similar extra tech: The Square Wallet app just requires you to select the Starbucks and say your name. It won’t be in every Starbucks just yet. The program isbeing run in 7,000 stores and if successful, will expand.

What does Starbucks get out of this? Savings. They do billions in business, a lot of it in credit cards, and you’ve got to pay swipe fees with those. If nothing else, having Square absorb that hit is good for business.

So who’s angry about this? In a word, everybody. Google has been struggling to gain acceptance for Google Wallet and ultimately just gave up and turned it into a card that you might actually use. Apple and Facebook are similarly trying to edge slowly into this space. So, having a major retailer that chose a mobile payments platform that isn’t theirs probably grinds a few gears.

Whether this remains a curiosity or explodes is a bit up in the air. To be honest, I’m a bit skeptical that mobile payments will grow at the rate analysts think. But if nothing else, Square gets its app out there: Everybody will try this at least once.

Read more: http://www.uproxx.com/technology/2012/11/starbucks-launches-its-square-program-today/#ixzz2CcheQfUt