[Dave Birch] While Starbucks is generally in the headlines here in the UK because of their corporate tax affairs, they are generally in my headlines because of their groundbreaking approach to innovation at the point-of-sale (POS). Innovation which, it has to be said, has been something of a success.

In January 2011, Starbucks became the first national retailer to offer its own mobile payment technology combined with a world-class loyalty program, and the company now generates over three million mobile transactions each week in the U.S. alone – accounting for approximately 10% of total U.S. tender

[From ADDING MULTIMEDIA Starbucks Introduces Innovative Cross-Channel, Multi-Brand Loyalty Program and Announces Global Social Impact Initiatives at Annual Meeting of Shareholders | Business Wire]

I've got the Starbucks app on my iPhone and I use it all the time. What's more, even though it's a Sterling account I use it in the US as well and it works perfectly there too. And they haven't stopped at experimenting with the app: they are exploring a variety of possibilities.

Square and Starbucks have struck a payments deal. As an astute analyst has pointed out, Starbucks can now use the Square system to extend the purchasing power of Stars. Square's technology doesn't see a difference between dollars and Stars, at least not natively. I suppose there will eventually be a regulation. But for now, there's no reason why Starbucks cannot issue Stars at will, and allow people to spend their Stars through Square on anything you can buy in Square. Which is, anything.

[From Terra Nova: World's biggest bank in 2023: Starbucks?]

In the UK, Starbucks now accepts contactless payments as well (a mere seven years after the first pilot of contactless in Starbucks) so it has become a wonderful living laboratory for emerging payments. I think that perhaps it is time, in the UK at least, to do something spectacular with that laboratory. But what?

Starbucks have been getting some terrible publicity concerning their tax arrangements. Personally I think it is the duty of corporate officers to minimise their tax liability since they work for the shareholders and where there are problems with the tax laws we should blame the tax authorities, not companies that behave perfectly legally in response to the incentives set for them by politicians. But that's by the by. Who am I against so many?

Talking about politicians, last year the Treasury Minister David Gauke got into a lot of trouble for saying that people who paid tradesmen in cash were aiding and abetting tax evasion and forcing every is to pay more. I never understood the criticism, since what he said was absolutely true.

Tradesmen have accused the Government of letting them down after David Gauke, a Treasury minister, criticised those who accepted cash-in-hand payments in order to cheat the tax man.

[From Tradesmen's anger over cash-in-hand claims – Telegraph]

People who use cash are, indeed, aiding and abetting tax evasion (and the discriminating against the poor as well, but that's another topic) so this gave me an idea. Starbucks could exploit that dynamic and earn themselves a unique position, a moral motte inside the payments bailey, that will simultaneously generate significant goodwill, free publicity, brownie points with the Revenue and the potential to substantially reduce operating costs. Starbucks should ban cash.

This would be a genius move! I don't believe there's anyone who goes into a Starbucks without either a mobile phone, a debit card or a Starbucks card. There'd be no problem in getting them to use these instead of cash. And getting rid of cash would mean getting rid of cash registers, which means more counter space available for sales, as well as getting rid of cashing up, security and all the other attendant drains on time and resources. And once cash is removed as a payment possibility, the ergonomics of the POS can be changed for the better to make the whole purchasing process smoother.

I'm sure they have some clever PR people who could help to retarget public anger about tax evasion, which would be to their benefit, and throw down the gauntlet to other retailers to follow suit. By firing an opening broadside in the war against cash, Starbucks could do us all a favour. I think I'll mention this to Starbucks when I bump into them at Europe's Customer Festival organised by our good friends at Terrapinn. The festival is in London on the 16th and 17th of September 2013 and they've got a terrific line up of speakers from Tesco, Sainsbury's, Waitrose, eBay and other retailers as well. I'll be there taking part in a couple of the sessions, and I hope you will be too.

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