Omnichannel Challenge: From Retail to Hospitality Reality

By Lisa Terry, Contributing Editor | April 11, 2016

The omnichannel shopper has been a retail reality for several years. Ubiquitous ordering and payment has started to filter into the hospitality industry and it is becoming increasingly important, however, many operators struggle with how to successfully deploy an omnichannel strategy. According to Hospitality Technology’s 2015 Customer Engagement Technology Study, by the end of 2015 just over half of restaurant mobile apps were capable of accepting food and drink orders and 58% enabled payment.

Unfortunately, not all of those apps were built in a way that felt seamless to the guest. Making sure the ordering and payment experience is consistent whether the customer is using a kiosk, a website, an app, a call center, a drive-thru or ordering in person is imperative to simplify the user experience and maintain trust in the brand. Getting from today’s complex stack of sometimes separate technology to a unified approach to ordering and payment, however, can prove to be challenging.
 
Consumers expect seamless omnichannel experiences and will patronize those that make transactions easy. Restaurants are under pressure to get there fast but also to get it right. Here are seven important considerations in making the transition to omnichannel ordering and payment.

Simplify the stack.  
Many restaurant operators are working toward a unified commerce platform in which a single, centralized, cloud-based order management engine drives end-to-end transactions within and across channels. Heartland Payment Systems (www.heartlandpaymentsystems.com) describes its commerce engine as a superset of business logic such as menu and prices that communicates the right data to the right channel and store based on business rules.

Unified commerce “provides the opportunity to enhance customer service with a more streamlined interface so [fewer] resources are spent making it all work together,” says Lee Holman, analyst at IHL Group (www.ihlservices.com).

For Milk Bar (www.milkbarstore.com), replacing fixed POS with Aireus’ (www.aireus.com) cloud-based POS not only positioned the chain well for omnichannel, but simplified reporting and operations. A single data stream from all stores and pop-ups can now flow directly into the chain’s Compeat (www.compeat.com) accounting and inventory package. Payments travel through a single processor and the chain is working with the vendor toward integrated online and in-store ordering. “We want to offer a customer experience that’s consistent across channels,” says Mike Van Dorn, director of operations for Milk Bar. “Buying a cookie should be simple.”

Lean on vendors for tight integration.
Work closely with vendors to attain seamless and highly reliable interaction between current solutions and new cloud components using APIs, SDKs and/or middleware.

An important goal in the Chili’s (www.chilis.com) rollout of 70,000+ Ziosks (www.ziosk.com) in its 1,200 restaurants was enabling customers to do as much or as little of the interaction with the restaurant on the tabletop devices as they wanted, so the system had to integrate tightly with Chili’s NCR Aloha (www.ncr.com/hospitality) POS system. The result is a hybrid architecture in which a Ziosk agent sits on the store POS as well as an in-store Windows server to manage local communication between the two systems; the system connects to the Ziosk cloud for functions such as updating menu and pricing content or customizing customer surveys.

However, despite best efforts, things will go wrong. ToGo Techologies (www.togotechnologies.com) advises restaurants to have a vehicle for when tech fails. Milk Bar’s ecommerce site, for example, provides phone and email contacts if ordering doesn’t work.

Invest in a great user experience.
It’s easy to get caught up in enabling insfrastructure, but equally important is ensuring an engaging customer-facing interface. Boxy POS (www.boxypos.com), for example, says it designs all of its user interfaces as if it’s for a customer, which helps ease training demands for staff-facing functions.

At Shomi, (www.shomirestaurant.com), for example, guests can access almost all of the POS interface functions as servers on their mobile devices using Boxy POS. Right now about 10% of guests choose to do so, but as that percentage rises, manager John Shu foresees requiring fewer servers. In addition, “It eliminates the need to wait for the server, so the customer can save time [or take their time]. That’s huge — we can draw a whole other crowd of people who would enjoy a fast casual dining experience,” says Shu.

“The biggest challenge is making sure all the teams coordinate around what we want the look and feel to be like and how to reduce the barriers of frustration for the guest,” and that includes vendor partners, explains Wade Allen, VP digital innovation and customer engagement for Chili’s. “Testing and quality assurance is everything.”

Make payment options consistent and plentiful.
No one wants to lose a sale because they can’t take the customer’s preferred payment vehicle, but payments are in the midst of huge disruption. Restaurants taking on omnichannel need payment partners that offer security, flexibility, and a way to make processing as centralized and simplified as possible.

Some restaurants achieve omnichannel payment via stored value cards which can be linked to a payment vehicle, according to Heartland and ToGo, while others accept payment via any type of vehicle, with the flexibility to adapt as things change.

Security is paramount; it’s vital to convert card data to tokens. Tokens can be single- or multi-use; the latter associates a token with a customer everywhere in the enterprise, and offers the benefit of seeing customer patterns across the brand.

Operationalize omnichannel ordering.
Enabling omnichannel orders can significantly impact kitchen operations and order pickup. Work out process and property changes such as installing food warmers and dedicated pickup desks or parking areas, advises ToGo Technologies. Some Oracle (www.oracle.com/hospitality) customers are leveraging kitchen display systems to identify the source of orders, to aid expo and trafficking.   
Crosstown Pub and Grill (www.crosstownpub-grill.com) has seen tableside benefits including faster turns since switching to TouchBistro (www.touchbistro.com) on iPads three years ago, and also saw its carryout business triple when a customer app showing menus and specials was added. The next step is working with TouchBistro to integrate the two. Crosstown’s challenges with their downloadable customer app is enabling online ordering with varying menus at two separate locations and payment processing, says Jim Nichols, chef-owner.

On the operations side, Crosstown designated a staging area and dedicated staff member as well as a carryout-only kitchen printer. “We try to get to those first because we need those to be ready in 30 minutes or less,” says Nichols.

Zebra (www.zebra.com) is helping restaurants identify pre-order customers as they arrive, such as using beacons. Intelligent WiFi networks are a key enabling technology to support this. Other ID options include geofences or QR codes on phones.

Make it easy for franchisees to say yes.
Brands’ ability to mandate IT varies widely. Those able to demonstrate a clear value proposition as well as IT savings are best positioned to succeed. Unified commerce and a simpler software stack generates savings that can be spread across the brand, says IHL’s Holman. Another key, according to Oracle, is to make it easy for management companies with multiple brands to use the platform.

Chili’s franchisees are largely autonomous when it comes to IT. Several lacked sufficient infrastructure for the Ziosk rollout. “We’ve taken an initiative to really align our franchisees around the technology stack that makes the most sense around corporate” by showing clear value for the franchisee being able to attain a consistent end-to-end brand experience and make future projects easier to implement, says Allen.

Create a path for social media and personalization/loyalty integration.
While the best projects are phased, satisfying consumers’ expectations for recognition and personal engagement while learning more about them means social media and loyalty integration must be part of the omnichannel road map. Create links from promotions to ordering platforms. Chili’s and Milk Bar each treated ordering and payment as phase one of their projects; Chili’s added loyalty in the second phase, to be followed by integration with guest mobile devices. 

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