7,000 Starbucks Get Square

I've been struggling to figure out why consumers would want to use mobile payments. Seems to me that cash and credit cards are already mighty convenient. 

This is one case where it makes sense. Starbucks purchases are habitual purchases; consumers buy the same thing every day. Anything that can be done to automate the process will increase customer satisfaction and reduce transaction times. 

In a way, I think my smartphone is more secure than my credit card. The reason? I would know almost immediately if I lost my iPhone whereas I really wouldn't know if someone stole one of my credit cards or set up a card using my info and a fraudulent address. If someone steals my phone, I have two or three systems installed whereby I can immediately render it useless. I can phone Verizon and have them freeze it. I can use Lookout. Or there's another service on there that will, basically, self-destruct the phone. So I'd almost rather use a phone-based digital wallet than traditional plastic, and hope more retailers offer this capability soon.

Very interesting way of looking at it, Alison. I never thought about the iPhone being more secure because of that but it makes total sense. People will freak if they lose their phone for even a moment, but a credit card is so easy to misplace or lose altogether and I've known people who have gone months without ever knowing a credit card was gone because they use it/them that little. Just comes to show you how much our society is changing and our dependence upon technology is growing, I suppose.

I wonder if this isn't a matter of individual preferences rather than social changes.  I'd certainly know if I lost a credit card.

I would like to think that this new way to pay with square really hits off.  I use this app on my android phone and I like it but not a lot of places in NC were I live use it.  Now on the other hand as a merchant I love how it is easy and a small % charged per transaction.  The only thing about this app and Starbucks is that I guess you would need to use the Starbucks Gold card I have which is the rewards card as the payment for the purchase to get my rewards.  I am not sure how that is working out sense I have not had the chance to use it at a Starbucks yet.  I can easily use the app that Starbucks has on my phone so not sure If I would need to use the Square one but it is great idea.  I will say if I forget my phone I will go home for it but I have forgot my wallet and I don't go back for it.  So that be nice to be able to use my phone to pay for everything.

@ Alison

I would have to agree if I had someone steal my wallet and take my credit card I may not know for a while till I needed that card but my phone like you said I would know right then.  My phone goes with me everywhere and I normally have it in my front pocket or in my hand all the time.  While I have lookout on my phone to render it useless via the wipe feature and then I have one that is to make it scream if someone tries to access it without the correct password after three tries.  The bad thing is I have T-Mobile so the thief will have my phone by putting their sim card in it but they would have to do a factory reset on it to use it.

Do you carry your license in your wallet? I'd go back for it at least for that :). 

Here in the States, we are so behind on some of these advances. Countries like Japan have been using their phones for years to make purchases. Even at vending machines. It's only a matter of time before it finally catches on here and I for one thing its a brilliant idea. We use our phone for everything now, so why not for payments too? 

If the thief knows what they are doing, especially with a sim-based phone, it's not too difficult at all. It's a good thing that a lot of newer phones have some pretty good security measures. Like how the iPhone can wipe your data after so many failed attempts. I'm not sure what android phones offer since I don't use one and never have, but I'd imagine there is something similar or maybe an app that could do it.

Cell phones are definitely a more secure payment option than credit cards. Mythbusters did an episode once on just how easy it is to get information off of a credit card. Not as easy to do with a phone that is secured.

We're definitely going to see more digital wallet options, although it has surprised me too, @JAdams, that the U.S. lags other nations in this area. I'm not sure if it's because the credit card and debit card providers are so well-entrenched here or whether there are other reasons, but it's certainly not because people don't have smartphones! With more consumers accustomed to making online payments, using our phones to pay the tab is a natural next-step.