Starbucks outsmarts banks in Fast Company innovation awards
16 February 2012 | 10981 views | 2
Fast Company's annual list of the most innovative companies in finance puts coffee chain Starbucks at number two and omits any traditional financial services firms, bar American Express, from the top ten.
While banks pour billions of pounds annually into their technology operations, the judges at Fast Company sought inspiration elsewhere, turning to hip start-ups such as Square and Dwolla in the payments space and new funding platforms such as Kickstarter, Y Combinator and SecondMarket.
While Square topped the rankings, the big surprise was the positioning of Starbucks at number two "for showing what a struggling powerhouse can do to revitalise its reputation and strengthen its relationship with customers through its own payment system". The coffee chain's mobile payments app saw 26 million transactions and more than $100 million loaded last year.
Among the top ten only PayPal and American Express can be considered mainstream players in financial services, PayPal for leading the charge on digital payments and the card scheme "for iterating like a start-up" in the roll out of its Serve mobile platform and loyalty schemes.
The banking industry's sole representative was Simple, the Bank 2.0 start-up that only opened its doors to customers in November and provides a warm-fuzzy front end to traditional old-line banking networks.
Finextra verdict: Banks get a bad rap for their conservative approach to innovation, typically portrayed by the hot start-up crowd as lumbering dinosaurs with creaking technology platforms and blinkered views. For sure, banks are big businesses with big responsibilities, hemmed in by regulatory constraints and sensitive to reputational risks, but here at Finextra Towers we see plenty of innovative thinking, both at an industry and departmental level, that often goes unsung and un-noticed by the Silicon Valley-obsessed tech press. Just today for instance, we have Barclays and the rest of the UK banking industry trending on twitter following the launch of PingIt, a game-changing money transfer system tied to user mobile phone numbers. On dealing floors around the world vast sums of money are spent every day in a technological arms race that pushes the very limits of mankind's computational capabilities. We could go an - at some considerable length. Maybe we should just go ahead and publish our own alternative innovation awards. Contributions and nominations welcome.