Customers attracted to restaurants that offer convenience, safety
As restaurants reopen, many consumers are looking to return to dining rooms. Most restaurant chain sales are down about 18 percent vs pre-COVID, but according to marketing-platform company Zeta, which tracks consumer preferences and trends, QSRs are faring much better, down just 3.5 percent. To recapture sales more easily during business reopening phases, restaurant operators are relying increasingly on technology solutions. Whether on-premises or off, customers want their dining experience to be as frictionless as possible.
Stepping back to look at the overall landscape,it’s important to note that food and meal orders increased in mid-May compared to April by 13 percent, according to Zeta. Nevertheless, a good number of restaurant patrons do not plan to return to restaurants anytime soon. In late May, 44 percent of customers said as much in a survey, according to foodservice consultancy Technomic. Therefore, reducing friction in all forms of ordering is key in an era when takeout orders have become a permanent and sizable part of restaurant business.
When compared to pre-COVID, many restaurant chains have actually increased sales. Sonic, Krispy Kreme, Dairy Queen, Raising Cane’s, and Taco John’s are some of the top chains that are showing this increase. QSR chains such as Sonic, that were already heavily drive-thru/drive-in based, appear to be benefiting from its current heightened popularity. These chains are also known for quick customer service interactions,which puts them in a good light when it comes to safety.
Understanding consumers in the current pandemic environment
As foodservice consultancy Technomic noted in a recent webinar, Off-premise shift, restaurants are operating in a dual-demand environment and therefore, must be ready to provide service when and where customers want. Takeout in its various forms is something that consumers now expect. Restaurant operators that embrace a seamless takeout experience will overcome short-term challenges and thrive after the health crisis is over.
One popular format, order-ahead for pick-up, makes a lot of sense for younger Millennials and Gen Y, just as it does for restaurant operators. Particularly in dense, urban areas where the delivery perimeter might not be large, order-ahead provides better financial results than third-party delivery where average commission can cost up to 25 percent of order amounts. By providing a convenient way to order and pick up food, restaurants can increase profitability in the absence of those commissions. Also, this format could bring restaurants an additional $7,000 in sales per day on average, according to Rakuten Ready.
Order-ahead for pick-up can also be a value play for customers because of the service fees and delivery charges they pay when ordering from third-party services. This cost savings will appeal to younger consumers and other customers whose incomes have been affected by the economic downturn associated with the pandemic.
Getting help with safety and sanitation
Frictionless ordering is also driven by the need for safety and sanitation. Consumers expect restaurants to provide a clear message about how they are safeguarding the health of their customers and their employees. As restaurant operators embrace contactless ordering and payment solutions for their customers, for example, they also reaffirm their commitment to keep their communities safe.
In a survey that illustrates the importance of safety and sanitation, consumers told menu-analytics firm Datassential what they would most likely do when returning to reopened dining rooms:
- Wash my hands more – 86 percent
- Maintain distance from other diners – 86 percent
- Avoid crowded waiting areas – 83 percent
- Avoid “open” food – 79 percent
- Disinfect / wipe down surfaces – 66 percent
- Avoid uncooked foods – 64 percent
- Avoid ordering shared foods – 59 percent
- Maintain distance from own party – 52 percent
- Wear gloves / masks in restaurant – 44 percent
- Bring own utensils / straws – 35 percent
For casual-dining operators, tableside kiosks can be great for ordering and payment. However, chains will need to adhere to frequent and disciplined cleaning of the devices.Furthermore, they will need to provide ways for customers to sanitize the devices during their meal. Mobile devices, which are already in customers’ hands, have become a preferred method of viewing menus and paying for orders. It will be interesting to see how kiosk popularity changes during the pandemic.
With regard to employee safety, order integration can be another vital tool for restaurants. The potential for cross-contamination is heightened when multiple employees are handing multiple devices to fulfill online and delivery orders. However, when restaurants integrate outside orders directly into the POS, as is possible through technology companies, like Olo or Chowly, that risk is reduced.
** Note that Pre-COVID = Last 2 weeks of; February and COVID = Last 2 weeks of May
Enhancing technology to reduce friction
Whether offering menus on a phone, payments sent to the POS via a mobile device or easy drive-thru & curbside experiences, technology is key to execution. Multi-unit operators benefit greatly from adoption of technology that helps them serve customers more efficiently and with less friction. And today’s consumers, who already wanted to experience restaurant food at their preferred places and times, can now also benefit greatly from enhanced safety. Several advances in technology are helping consumers skip the lines and reduce interaction with others. Contactless payment, order-ahead, drive-thru and curbside all help customers to feel safe while patronizing restaurants.
Fast-casual bakery-cafe chain Panera Bread launched a geofencing capability to help with curbside orders. By expanding Wi-Fi service and tapping geofencing technology, Panera will know when customers arrive to pick up their orders, thus speeding up curbside pickup. First, customers place their order on the Panera app or online. Next, they enter their vehicle information so it can be easily identified when they arrive. When customers arrive, they press the “I’m here” button in the app to signal they are ready for their order.
According to a Rakuten Ready whitepaper, A contactless drive-thru experience increases safety and revenue, order-ahead is one of the most profitable channels for today’s multi-unit operator. Not only are wait times reduced, but the ability to take orders and prepare with minimal impact to staffing levels is a sure win for restaurants. Fast-casual Chipotle is a chain that has benefited from both an easy-to-use app and the availability of pickup cubbies for takeout orders. Chipotle offers a model that other limited-service and sit-down chains can emulate.
With order-ahead drive-thru—another format that Chipotle has embraced—wait times at drive-thrus become shorter and through-put expands. This spotlights all the best features of efficient ordering and pick-up. As Rakuten Ready team reports, there is even more upside revenue opportunity: Order-ahead drive-thru customers can be upsold in the drive-thru, the increased efficiency reduces drive-thru queuing, and this in turn attracts more customers that are driving by.
Thus, technology is a great facilitator of frictionless ordering, helping restaurants attract more customers and making it easy for consumers to order food. With an ongoing global pandemic, ”frictionless” also means “safer.” Consumers want to order more food and drink from restaurants, but they also want that experience to be hygienic and safe. Technology enables many of those outcomes for restaurant operators.
Photo credit: Krispy Kreme (inline 1), Chipotle Mexican Grill (featured preview image, inline 2)
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