The Future of the Quick Service Restaurant Industry
Ten years ago, in 2007, technology was just starting to integrate into the food and beverage marketplace. Quick Service Restaurants began rolling out websites, menus were made available online, and customers could post reviews of their experiences. Fast forward to 2017, and the situation is very different. For starters, mobile ordering has been around at restaurants like Subway, Starbucks, Chipotle, and Panera Bread for a couple of years. Loyalty programs made available through mobile apps continue to gain traction, especially when tied to a digital purchase. Perhaps most importantly, customers are making choices based on speed and convenience. If we look ahead another ten years, we predict that the QSR industry will go through an even more dramatic transformation. This article from Avanti Commerce will discuss what it predicts the industry will look like ten years from now, and how the customer will evolve.
Technology Eliminates Human Cashiers
Around the world, QSRs are investing tens of millions of dollars to offer mobile on-the-go service to their customers. To stay ahead of their competitors, they are doing two things. First, they’re offering better quality ingredients and an increasingly dynamic menu. Second, they’re creating VIP incentives to create relationships with their most loyal customers. What makes one restaurant stand above another is its use of digital engagement with their customers. There’s no doubt that the food service industry is becoming more automated. Technology is changing, and will continue to change the way restaurants are laid out and how customers experience and interact with brands. The biggest change that retail technology will bring, is eliminating the need to line up for a cashier to take an order. In many restaurants, the amount of seating will be reduced. When customers arrive, they will be greeted at the entrance by a host. The layout will evolve and the structure will allow customers to easily pick up their order. Once customers move past the entrance, there will be a series of pick-up windows or wickets, where they will collect their orders. The most important element, convenience, means customers’ orders will be ready for pickup by the time they arrive. Most notably, the level of human interaction will be decided upon by the patron. Customers will have the option to grab and go, or choose to stay, enjoy the ambiance, and interact with staff.
The Rise of Mobile Ordering, Payment
The next part of the equation is what this means for customers. The most important customer group to focus on are millennials because they are undoubtedly the spenders of the future. As a group, they are addicted to technology and their smartphones. For the food services industry, this equates to opportunity.
For millennials, digital payments have become commonplace. The question now is: How much bigger of a role will mobile payments play as millennials' prominence increases in the marketplace? Unlike generations past, millennials have no issue spending money on shopping and eating out. According to a recent report, there are eighty million millennials in America alone and they represent about one fourth of the entire population, with $200 billion in annual buying power. A recent study from the Food Institute’s analysis of the United States Department of Agriculture shows that 44% of those dollars are spent on dining out. This translates to opportunity for those working in the QSR industry. Millennials are on board with mobile ordering and they will choose ease and convenience over brand loyalty. This means that if companies want to stay competitive with the millennial generation, they must be prepared to deliver.
Right now, technology and the QSR industry are at a crossroads. As we look ten years to the future, there is no denying that technology will continue to play a pivotal role in the industry’s evolution. Traditional commerce and retail are changing. Virtual channels like Uber and Expedia have been selling the same product for several years. Now, aggregators like Just Eat and Grub Hub are catching up. Brick and mortar locations must do the same. From a consumer perspective, the realization is that technology is already impacting the way they complete a transaction, but how much bigger of a role will it play ten years out? That is an answer that only time will be able to tell.
Those operators that have been investing for years, have executive alignment and meaningful budgets will take market away from those that don’t. There will be a divide, especially as viewed by millenials. Brands that get it vs. brands that don’t.
Technology Eliminates Human Cashiers
Around the world, QSRs are investing tens of millions of dollars to offer mobile on-the-go service to their customers. To stay ahead of their competitors, they are doing two things. First, they’re offering better quality ingredients and an increasingly dynamic menu. Second, they’re creating VIP incentives to create relationships with their most loyal customers. What makes one restaurant stand above another is its use of digital engagement with their customers. There’s no doubt that the food service industry is becoming more automated. Technology is changing, and will continue to change the way restaurants are laid out and how customers experience and interact with brands. The biggest change that retail technology will bring, is eliminating the need to line up for a cashier to take an order. In many restaurants, the amount of seating will be reduced. When customers arrive, they will be greeted at the entrance by a host. The layout will evolve and the structure will allow customers to easily pick up their order. Once customers move past the entrance, there will be a series of pick-up windows or wickets, where they will collect their orders. The most important element, convenience, means customers’ orders will be ready for pickup by the time they arrive. Most notably, the level of human interaction will be decided upon by the patron. Customers will have the option to grab and go, or choose to stay, enjoy the ambiance, and interact with staff.
The Rise of Mobile Ordering, Payment
The next part of the equation is what this means for customers. The most important customer group to focus on are millennials because they are undoubtedly the spenders of the future. As a group, they are addicted to technology and their smartphones. For the food services industry, this equates to opportunity.
For millennials, digital payments have become commonplace. The question now is: How much bigger of a role will mobile payments play as millennials' prominence increases in the marketplace? Unlike generations past, millennials have no issue spending money on shopping and eating out. According to a recent report, there are eighty million millennials in America alone and they represent about one fourth of the entire population, with $200 billion in annual buying power. A recent study from the Food Institute’s analysis of the United States Department of Agriculture shows that 44% of those dollars are spent on dining out. This translates to opportunity for those working in the QSR industry. Millennials are on board with mobile ordering and they will choose ease and convenience over brand loyalty. This means that if companies want to stay competitive with the millennial generation, they must be prepared to deliver.
Right now, technology and the QSR industry are at a crossroads. As we look ten years to the future, there is no denying that technology will continue to play a pivotal role in the industry’s evolution. Traditional commerce and retail are changing. Virtual channels like Uber and Expedia have been selling the same product for several years. Now, aggregators like Just Eat and Grub Hub are catching up. Brick and mortar locations must do the same. From a consumer perspective, the realization is that technology is already impacting the way they complete a transaction, but how much bigger of a role will it play ten years out? That is an answer that only time will be able to tell.
Those operators that have been investing for years, have executive alignment and meaningful budgets will take market away from those that don’t. There will be a divide, especially as viewed by millenials. Brands that get it vs. brands that don’t.