On September 25, Starbucks and Alipay announced cooperation. Finally, the Starbucks will accept the payment system at over 2,800 of its cafes across China. “The days that we receive complaints from customers at Starbucks are over.” Alipay declared in its official weibo account.
Alipay is available at over 3,200 Starbucks stores worldwide
“Do you accept Alipay?” consumers ask Ms Fan, a clerk at a Starbucks store in Xia Sha, Hangzhou municipality, almost every day. “Sometimes we hear such a question for dozens of times a day.” Fan said. On top of saying ‘sorry, we have not accepted Alipay yet’, clerks indeed cannot further explain why. Similar questions and complaints are raised online.
However, today came exciting news for Starbuck consumers. “At last! Starbucks stores accept Alipay!”
On September 25, Alipay’s official Weibo account announced that over 2,800 Starbucks stores in the mainland China would accept Alipay.
Additionally, Alipay can also be used in Starbucks stores across Macau, Malaysia, and Okinawa Airport. Currently, Aplipay is available at over 3,200 Starbucks cafes.
Chinese market is vital for Starbucks which saw a 4% global growth year on year and a stunning 7% growth in China in its financial statements of the third quarter. Its revenues in the Asia-Pacific region, Starbucks’ second biggest market, increased by 9%.
In a push for its long-term development in China, Starbucks poured $1.3 billion to take back the ownership of Starbucks cafes in Shanghai, Zhejiang province, and Jiangsu Province as part of its effort to directly manage all its stores in mainland China. On the other hand, it seeks breakthroughs via Internet such as using Alipay platform boasting 520 million users to please Chinese consumers.
Moreover, our reporter has learned that Alipay and Starbucks invested over ten million yuan as dividends for customers. In the coming days, customers can get Starbucks coupons worth 8.8 yuan each and will be rewarded with a coupon worth 5 yuan if their consumption top 50 yuan.
Chinese consumers can pay for their Starbuck coffee with Alipay overseas as well. Last month, Starbucks in Malaysia announced that all 242 stores would support Alipay and Chinese tourists would be able to find nearby Starbuck stores through “discovery” platform on Alipay.
“Ant Forest calls upon all customers to bring cups in a café to make the sky bluer.” the official Alipay Weibo account reminded.
Starbucks’ experiment in new retail
Starbucks expanded quickly in China out of confidence for Chinese market. In 2011, it only had 400 stores in mainland China. In October, 2016, when it appointed Wan Jingying as CEO of the China region, it announced plans to double the number of stores from 2,300-odd then to 5000.
Howard Schultz, president and founder of Starbucks, said, “Retail business will undergo a huge adjustment; accordingly, many brick-and-mortar stores will close. We must build better and romantic stores creating a sense of belonging.”
On April 11, 2017, one week after he retired from the CEO position, Howard Schultz delivered a speech in Tsinghua University. One of his judgments could unnerve Chinese retailers: all physical stores have to make changes because of e-commerce giants, such as Alibaba and Amazon.
Schultz himself is promoting “global source selection” and “coffee baking workshop”, which belong to a new form of business which is more fresh and high-end.
Besides, Starbucks China has explored many business ideas, including integration of online service with offline service, mobile payment, socialized consumption experience, and personalized stores.
In December 2015, Starbucks opened a flagship store on Tmall. This online store authorized by Starbucks has been regarded as Starbucks’ ‘retail store’ in which electronic /physical gift cards, electronic/physical rewards, and coupons for different types of coffee. You can treat your friends from afar a cup of coffee conveniently through this way. After the purchase, you will have an electronic receipt that can be given to your friends so that they can buy a cup of coffee with it.
To improve efficiency of payment, KFC and McDonald’s have already promoted ordering kiosk and the latter even separated ordering area from dining area. Comparatively, the impression of long lines in Starbucks deters many potential consumers with limited time.
Now, Alipay is available at over 2,800 Starbucks stores in mainland China. Indeed, Starbucks’ experiment of new retail has made a big leap.
This article originally appeared in new retail insider and was translated by Pandaily.
Click here to read the original Chinese article.