The place your product doesn’t want to be – the tumultuous pairing of Square and Starbucks

I thought that Starbucks would eventually buy Square, not destroy it. Essentially Starbucks just discarded Square after a short (and costly for Square) 2 year relationship. Sure, Square still processes Starbucks payments but by all accounts this is costing Square on every single transaction. It’s like Starbucks cozied up to them, loved them, fed them the line (Schultz joined the Square board) and then dumped them when they got what they wanted. This is not a good place for Square to be. This is not a good place for ANY company to be.

The thing with building anything in mobile is that, by definition, you are at the forefront of technology and business. There is no doubt that Square fits this. The problem is that when you become a stop gap measure – a temporary offering while the bigger companies catch up – your life will always be cut short. Starbucks has been very public about their views on mobile payments and mobile ordering – they have transformed themselves into a very progressive technology company. And they own the most successful mobile commerce and loyalty app on the planet right now. It was only a matter of time before they did not need Square any more.

The lesson here is that brands still want to own their brand. They don’t want anyone touching their customers. It’s a big ask to insert yourself between your customer and their customers. Being in that spot as a business is precarious at the best of times, more so if you are also trying to build a brand using your customer’s customer. Add value, contribute to a brand, don’t try to usurp it.

A hard lesson for Square to learn.

About the author

Rob Woodbridge

I'm Rob, the founder of UNTETHER.tv and I've spent 14 years immersed in the mobile and pervasive computing world. During this great time I've helped some of the most innovative companies grow their business through mobile. If you are in need of a mobile business advisor or coach, connect with me here to get things rolling.

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