Starbucks announces delivery service to boost mobile app usage


During Starbucks' recent Q3 2014 earnings conference call, CEO Howard Schultz announced the company's plan to offer a delivery service starting next year, reports USA Today. Schultz failed to provide details about the service, but the initiative supposedly would allow customers to place a delivery order using the Starbucks mobile app.

"Imagine the ability to create a standing order of Starbucks delivered hot or iced to your desk daily," said Schultz during a conference call following the coffee giant's third quarter earnings report. "That's our version of e-commerce ... on steroids!"

The delivery option was met with skepticism from analysts who noted that a delivery service was a large jump from the retailer's core business of serving hot fresh coffee, sandwiches and pastries in its cafes. Maintaining the high quality of its beverages and food items while meeting delivery deadlines will be a challenge that Starbucks will have to overcome if it wants to be successful with this on-demand service, notes critics of the service.

Starbucks is looking at delivery as a way to increase the usage of its mobile app, which already is responsible for 15 percent of all purchases. While it develops its delivery service, Starbucks already is preparing a pre-order service that is being tested in Portland, Oregon. The pre-ordering option will allow customers to place an order via the mobile app before they head over to their local Starbucks.

Similar to the pre-order option, the new delivery service will integrate into Starbuck's existing mobile app. It will roll out in waves with select markets testing the service ahead of a larger-scale launch. Details on where it would be available and what it would cost were not announced.