Starbucks and Taco Bell Race to Set Mobile Payment Precedents

starbuckstacobellTaco Bell went dark on social media sites this week, to draw attention to the launch of their new mobile ordering and payment app, and they’re not the only restaurant looking to dive into smartphone ordering.

Chipotle Mexican Grill and Wendy’s are also preparing to launch mobile ordering services, and McDonald’s and Panera Bread are integrating Apple Pay into their payment options. Taco Bell is one of the first fast food restaurants to allow customers to order from their phones and pick up meals at their locations, and now Starbucks is looking to go one step further.

Starbucks has already seen considerable success from their mobile app, which allows users to pay from their phones, find promotions and accumulate rewards. But this week, the coffee company’s CEO Howard Schultz announced in a conference call that 2015 will bring the app into a whole new realm of service: delivery.

A new version of the Starbucks app will be launched in select markets in the second half of 2015, which will allow mobile payment, ordering and even delivery to your home or office.

“Imagine the ability to create a standing order of Starbucks delivered hot to your desk daily,” Schultz said. “That’s our version of e-commerce on steroids.”

The mobile ordering and payment component of the app will launch in Portland next month and nationwide in 2015.

When CNBC asked Starbucks Global Chief Strategy Officer Matthew Ryan for more details about the delivery component, he pointed out that delivery is still in its “early days” but that developers are “moving full speed ahead.”

In the meantime, customers can already take advantage of Taco Bell’s new mobile app for iOS and Android devices, which went live on Tuesday.

Customers with the Taco Bell app can order and pay ahead of time using credit or Taco Bell cards before driving to the restaurant to pick up their orders. The fast food restaurant is also revamping its internal point-of-sale systems and back-of-house technology to handle the change.

There are many benefits to mobile ordering, including improved accuracy, reduced employee theft, faster checkout times, higher profits, and customer satisfaction.

“Any mobile app if it is built right will succeed in today’s ever growing mobile marketplace, and on the other hand if it’s not it is doomed to fail from the start as we have seen many apps that are poorly executed with no planning, bad coding, and a company that cannot backup the services or products they offer,” says Jared Haggerty, Solutions Consultant, Databerry, Inc.

With so many advantages, expect to see many restaurants entering the world of mobile ordering soon.