What’s certain is delivery isn’t losing steam. In turn, profitability is becoming as much a digital investment as it is a physical one. Shake Shack CFO Katie Fogertey said at this year’s ICR Conference that funneling customers into native channels will be a major area of emphasis in 2022. Shake Shack launched a new website last year and is viewing omnichannel preference as a chance to regain control, not cede it.
“And we really want our own digital channels to be the preferred channels for our guests,” she said. “We’re building personalized marketing opportunities to help drive frequency and guest connection. We just know and we continue to see it, when we bring a guest into our digital ecosystem, we see higher frequency, we see higher checks. There’s a better guest experience associated with that. We just think they understand who we are and the value that we offer more.”
It goes as far as Shake Shack building drive-thrus (the first of which debuted in early December in Maple, Grove, Minnesota) to pickup windows to urban stores with expanded shelving to an upcoming Hasbrouck Heights, New Jersey, location that has limited to no seating, with a drive-thru focus.
Even the website update was designed to fuel app downloads (guests are immediately promoted to do so). Shake Shack has seen success with kiosks in store, too (at those units more than 75 percent of sales flow through the feature and other digital channels). The blanket idea is Shake Shack is trying to harness customers’ clear demand for convenience sent into high gear by COVID. It wants to control the process in a branded way. Chipotle’s order-ahead pickup lanes are being rolled out in much the same vein. A more profitable outlet where the company can nurture the experience for guests and counter third-party margin hits.
Customer preference is always going to lay the baseline, however. Digital ordering solution Tillster, in a survey of 2,000 quick-serve and fast-casual consumers, took the pulse of how user habits have changed during COVID. And are they short- or long-term adjustments?
Firstly, as outlined, demand for delivery was already ticking up pre-pandemic, with respondents in past surveys ordering delivery 1.9 times per month across age groups.
The average quick-serve customer today is ordering twice each month, Tillster found. And at 2.5 orders per month planned in the next three months, we’re looking at a 32 percent bump from 2019, with a definite rise among middle and older-aged groups.
In the next year, 81 percent of respondents said they’d order online for delivery the same amount or more often.
How, and where, guests believe they can go for delivery, though, is an evolving point. This, too, was triggered by pandemic conditions. Customers missed brands as much as they preferred delivery. So their decision to order, unlike before, wasn’t necessarily influenced by whether or not they wanted to stay home or not. They might have wanted to support, or simply missed, a specific restaurant they weren’t able to dine-in with when lockdowns went into effect.
Whether the end-result was direct delivery, curbside, pickup, etc., COVID brought more brand-loyal diners into the off-premises world than 2019, when aggregator services were seen as a product-specific platform for frequent users. In other terms, people looked for burgers more than they tried to dial up a local restaurant with a great burger.
In Tillster’s study, customers showed they’d rather, at this juncture, interact directly with their favorite brands. When ordering online or via branded mobile app, menus are optimized for ease of ordering and customers’ past orders are saved—frictionless goals that speak to Fogertey’s comments of how Shake Shack is trying to close the convenience loop.
Forty-four percent of respondents said they’d prefer to order delivery directly through the restaurant’s website or mobile app.
Twenty-two percent noted they still choose the phone, a choice popular among rural and over 55 residents.
Less than 10 percent said they prefer third-party delivery experiences.
Like the phone stat, delivery preferences were largely tied to generational differences.
One group worth pulling out is Gen Z, a climbing segment that’s dictating tech trends on their own terms.