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Peet’s Coffee & Tea brews up competition with mobile payments

October 12, 2011

Consumers can use mobile payments at Peet’s Coffee & Tea

Coffee chain Peet’s Coffee & Tea is going head to head with its competitors in the mobile commerce space by signing on as the latest retailer using Google Wallet.

In addition to accepting Google Wallet payments, Peet’s Coffee & Tea is also letting consumers pay via MasterCard PassPass. This initiative marks Peet’s Coffee & Tea’s first major mobile deal.

“Customer service is top of mind at Peet’s and we strive to make the experience the best it can be,” said Kay Bogeajis, vice president of retail at  Peet’s Coffee & Tea, Emeryville, CA.

“Providing the option to pay using NFC-enabled smartphones with Google Wallet and MasterCard PayPass-enabled cards creates yet another way we can provide exceptional service while, at the same time, serving the freshest and highest-quality coffees and teas,” she said.

Stirring up the mix
Peet’s Coffee & Tea operates shops in California, Colorado, Illinois, Massachusetts, Oregon and Washington.

The company claims that all locations will be equipped for mobile payments by the end of October.

Eighteen stores in San Francisco and San Jose, CA already have the mobile payment readers.

With the new technology, consumers can pay for items by tapping their mobile devices via the Google Wallet app or on Paypass-enabled registers.

“Starbucks has its own mobile wallet program and while Peet’s Coffee & Tea doesn’t have the same national footprint as Starbucks, it is still a competitor,” said Noah Elkin, principal analyst at eMarketer, New York.

“The issue for Google with mobile payments will be getting retailers to come on board with the solution,” he said.

“Everyone understands how mobile payments works and how it might be potentially valuable, but now consumers need to see mobile payments in real-life situations.”

Mr. Elkin is not affiliated with Peet’s Coffee & Tea. He commented based on his expertise on the subject.

Coffee war
By tapping into mobile payments, Peet’s Coffee & Tea is acknowledging that there is a need from consumers to buy items, such as coffee, on their handsets.

It also signals a direct competition with coffee giant Starbucks.

Most recently, Starbucks rolled out a commerce-enabled application that lets consumers buy items on their mobile devices (see story).

Starbucks has also dabbled in mobile advertising in addition to other initiatives.

One challenge mobile payments face is convincing retailers that they need the tools to invest in the resources needed to make it happen.

“The issue isn’t about the amount of money consumers are willing to pay for things with mobile payments, it’s about the type of spending they are doing and the security risks involved,” Mr. Elkin said.

Final Take
Lauren Johnson is editorial assistant on Mobile Commerce Daily, New York

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