With industry players like McDonald’s competing for millennials’ attention and losing market share to the rapidly growing fast casual segment, QSRs are stepping up their game by introducing new technology, specifically mobile, to level the playing field. Pizza is not the only segment connected to customers digitally. Taco Bell, Wendy’s, McDonald’s and others rolled out mobile apps in 2014, and in many places, their customers can order online.
Digital touch points can offer competitive data as well as personalize a customer’s order. It’s a race to the top for both fast casuals and QSRs latching on to the potential digital ordering can offer.
According to research from eMarketers, an independent market research company that provides insights and trends in digital marketing, mobile apps, kiosks and tablet menus offer QSRs and fast casuals opportunities: “Their experiences demonstrate to other retail sectors how digital technology can improve the efficiency and speed of their operations,” the research said.
Ordering on the move
Online ordering is going mobile, according to the NRA 2013 “Restaurant Payments” survey, eMarketers said. Research indicates that 52 percent of U.S. Internet users would likely use a smartphone or tablet for ordering takeout and delivery if possible, with 74 percent of millennials expressing interest in doing so. Research by eMarketers shows that 71 percent of respondents in a study on digital ordering adopted mobile websites among restaurants worldwide. Most participants in the study (55 percent) used mobile apps for viewing restaurants and menu prices, followed by checking hours of operation (46.1 percent), searching for nearby restaurants (45.4 percent) and looking for deals (38.2 percent).
Though fast casual concept Cousins Subs’ primary customers are Baby Boomers, the chain launched a mobile ordering app in 2014 to capture Millenials.
“We have seen improved order accuracy, increased average check for online orders, reduced guest wait times and better guest service,” said Matthew Somoles, director of field services at Cousins Subs. “The addition of our mobile app has provided a new avenue for our guests to quickly and efficiently order our products on their mobile device. Overall, we’re very pleased with the growth of our online ordering program and expect continued growth.”
In the nine-month period since the mandatory system-wide rollout, the percentage of online sales increased from 0.5 percent to 2.2 percent. In that same time period, the average order increased 73 percent and online sales per store increased 66 percent, the company said.
The study conducted by eMarketers shows that the most prevalent reason for baby boomers ordering online is because they don’t have to wait, while millennials prefer it due to its ease of use and order accuracy.
Charles Wiedenhoft, director of strategy planning for Red Door Interactive, a data-driven marketing agency that help brands connect with customers across touch points, said, “We’re seeing a switch from desktop to mobiles and tablets with half of, if not more, traffic coming from mobile and about half from desktop.”
Hopelessly devoted to digital
Papa Johns, along with numerous pizza brands, is a long-time user of digital ordering systems. The company started its system in 2001 and now says 45 percent of orders are digital, with delivery-only orders at 60 percent online. Papa John’s turned its app into an opportunity to customize pizza, much like a typical fast casual.
“We like any digital customer, whether it’s desktop or mobile or tablet, because they tend to be better customers, [are] more loyal and spend more than people that come in through traditional means,” Papa John’s CMO Bob Kraut told eMarketers.
Digital customers are more valuable, according to Wiedenhoft, because they’re dedicated to the digital experience, which leads to more cross selling. “Competition for online and mobile consumers is fierce,” the study said.
Because of that loyalty, digital touch points are critical for today’s restaurants.