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| A customer orders drinks and a muffin with the 'siren order' system on her mobile application at a Starbucks coffee shop in Seoul in this 2018 file photo. / Yonhap |
The National Assembly passed three bills related to data last month that allowed the open banking system used by local banks and FinTech firms to access the information.
This has opened a new world for many enterprises to use big data in collecting information about their customers, and Starbucks Korea is no exception. In fact, it is in a strong position to utilize big data and the open banking system to the fullest
Korea is the fifth largest market for the American coffee franchise, with over 1,380 outlets currently operating nationwide, and among them, 850 have been designated "no cash shops."
The global coffee chain adopted the program starting last April and it has been encouraging people to use its "My Starbucks Reward" system where customers charge their mobile application card to pay.
Customers have other options such as a credit card or Samsung Pay, but Starbucks Korea started its "siren order" system in 2014, allowing people to order coffee directly from the app on their mobile phone.
Customers order in advance and can take their purchase away on arrival. This has led to nearly 5 million customers registering for the service.
According to a 2018 Starbucks Korea report, the coffee company received 75 billion won in advance payments.
A Starbucks Korea official said this amount was not entirely cash customers charged on their mobile application as it included other money as well.
"We cannot reveal how much of the 75 billion won is from the cash our customers deposited through their mobile apps. Also, we cannot say what other money has been included in the advance received category in our audit report. It is a business secret," he said.
"The advance payment is not profit. It is literally prepaid money for the drinks that our customers want in the future. Obviously, we cannot freely use the funds," the official added.
Another Starbucks Korea official denied the franchise was paying more dividends to its headquarters in the United States from the increasing sales it is reporting annually.
Instead, he hinted that the company could invest the boosted profits into improving customer service utilizing big data.
The Korean branch not only launched the "siren order" system, but also began a "call my name" service in 2014. Staff call out the customer's name when their order is ready.
The company said this has earned a positive response from customers for its friendly communication service.
It also collects feedback from people online about new drinks it has launched.
"Starbucks Korea, in particular, has introduced many unique products that use local ingredients. The mungyeong omija fizzio, a five-flavor berry soda drink, is one of the most popular drinks that we began offering two years ago only in Korea," the official said.
Starbucks Korea said it has no plans for any new services in the near future, but for now it will continue with "My DT Pass" where customers can order a drink for a drive-thru pickup. The payment will be made online and license plate number recognition technology will help to identify customers who have registered their vehicle's information in the app.
"We adopted new technology that allows customers to order using their voice. Because it is not safe to use a mobile phone while driving, our application will can recognize a voice command and send an order to a designated drive-thru coffee shop," the official said.
