Digital control is changing the restaurant industry
It’s no secret that the acceleration of digital transformation in the wake of the pandemic has altered consumer preferences. As people have grown accustomed to interacting with others digitally, quick service restaurants (QSRs) and restaurants have noted major shifts in the way customers want to order and receive their food. Now that consumers have taken a liking to digital ordering – its convenience, time saving, variety and simplicity – it seems they have no intention of going back to analog versions of restaurant interaction. .
A recent PYMNTS study found that compared to 2019, 36% of customers use mobile apps more often to order ahead, 32% order more often from restaurant websites, 32% place a pickup order more often over the phone and 28% use food delivery. aggregators, such as Grubhub and DoorDash, more often. Aggregator usage also shows demographic trends, with millennials accounting for 34% of all aggregator users. Those who use more than one aggregator are also more likely to be millennials and consumers with incomes over $100,000 per year.
The increase in digital order volume and the demand for faster service has deeply shaken restaurant operations, leaving many QSRs and restaurants wondering what will be next in order to maintain customer happiness and loyalty. This month, PYMNTS Intelligence examines how digital customer order demands are reshaping the QSR and restaurant industry from the ground up.
The problem is the scale
At the height of the pandemic, restaurants have focused on bolstering their digital storefronts, enabling more digital and contactless ordering capabilities. However, faster and more convenient food ordering systems are pushing restaurant operational capabilities to their limits due to labor shortages. persist. Now, QSRs must rethink their strategies to keep pace with growing customer demands by optimizing efficiency.
Customer preference data tells a very distinct story: there is a significant drop in indoor dining at QSRs and restaurants due to an increase in off-premises dining preferences. Specifically, appeal is high for drive-thru options, which 37% of customers identify as the preferred command mode.
Part of the reason for this shift in preferences is that 30% of Americans not feel cozy dining inside. The other factor is the speed and convenience that consumers experience with other means of acquiring food. More than half of consumers use a digital application for ordering restaurant food for dining out. Even in a physical restaurant, 64% favorite to order their takeout food digitally, instead of talking with servers.
PYMNTS research indicates that features such as time-saving ordering capabilities, convenient order pickup options, and payment-related digital features are key factors in determining whether or not a consumer will choose a restaurant. Additionally, food pickup and ordering options are important components of long-term customer loyalty, with 34% of restaurant customers saying that pickup and ordering improvements will increase their loyalty.
How QSRs Solve the Demand Problem
The massive increase in demand for digital ordering, combined with the declining desire to eat indoors, means the way forward for QSRs is all about restaurant design.
To protect themselves operationally, restaurants are looking to reduce the interior space of their establishments while upgrading their kitchens and adding more exterior features, such as walk-in order windows. Fifty-five percent of restaurateurs during a recent investigation said they plan to add more space for pickup orders, while 45% plan to add more locations and drive-thru lanes to keep up with the influx of advance orders and to take away. Forty-three percent of restaurateurs are also looking to add outdoor dining space for customers who still want to eat in a physical location but are hesitant to eat indoors.
Along with creating more drive-thru space, restaurants are trying to implement advanced technologies in drive-thrus to optimize the experience. Four out of five consumers, for example, say they would order from an automated voice system or kiosk while in a drive-thru lane rather than talking to servers.
Another way restaurants are preparing for the challenge of increased orders through aggregators is by expanding the footprint of their virtual restaurants. Forty-one percent of independent restaurants currently function ghost kitchens to meet consumer delivery demands. Of these operators, 46% report not only that their virtual restaurants are permanent additions, but also that they plan to open three or more next year.
The future of restaurant design is always evolving, but innovators in the field are always looking ahead. The signs are clear as to what needs to be done now to meet offsite ordering expectations, but the means to ensure effectiveness are also changing. Restaurants are already considering how to expand take-out food delivery using a drone or driverless car, an idea that has seen an increase in consumer interest of 10% year over year. As the demand for food orders drives innovation, the restaurant industry will continue to innovate to keep customers happy.