The bar has been raised
Restaurants have seen this scenario unfold before: more consumer choice breeds higher expectations. Just ask retail and how the disruptive force of ecommerce forced big-box companies to focus on experience, digital, and the rush to strip friction across multiple ordering channels. COVID-19 rattled this dynamic for restaurants. And, mostly, it’s been a positive turn for quick service.
Consumers’ preference for tech-driven ordering, as well as how they receive food, has hardly waned in recent months. While the pandemic super-charged digital adoption (out of necessity), it’s an experience guests clamored for before. They’ve shown few signs of shedding the habit.
In a recent study of more than 5,700 global consumers from Oracle Food and Beverage, it was clear guests embraced digital. But, as noted, the fact they've done so has surfaced different standards. Of those surveyed, 64 percent said they don’t want to wait more than five minutes to order at the counter or drive-thru window. Seventy-one percent of in-house diners also noted they’d be upset waiting more than 10 minutes. More than half (55 percent) were fed up after five minutes at the drive-thru, and 54 percent were annoyed after 10 minutes while dining at a restaurant.
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“Online and mobile ordering was a lifeline to restaurants shut-down in the pandemic and continues to provide steady revenue,” says Simon de Montfort Walker, senior vice president and general manager at Oracle Food and Beverage. “As already short-staffed restaurants reopen, they are grappling with how to manage both in-person diners and deliveries, while meeting growing expectations on speed and service. Technology that helps kitchens manage and time orders from multiple channels will be key to keeping pace and ensuring diners stay happy and loyal.”
Here’s a look at some figures and insights driving trends today, and what could be in store for restaurants when 2021 hits the rearview.
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Start the clock
The window to serve guests is shrinking.
More than half (54 percent) of in-house diners in Oracle’s study said they don’t like to wait more than 10 minutes to be served and 76 percent get impatient after 15 minutes
For those ordering at the counter, 45 percent are annoyed if they must wait more than five minutes and 76 percent didn’t want to wait more than 10 minutes to be served
At the drive-thru, nearly one in five consumers (19 percent) didn’t want to wait more than two minutes to get their food, while more than half (55 percent) were fed up after five minutes.
Also, 45 percent of respondents said they feel the wait time is longer when ordering in-person, and 38 percent of those dining in feel deprioritized compared to online orders.
That last point deserves to be underlined. Restaurants are trying to balance digital gains made during COVID alongside the return of in-store visits, all while facing staffing shortages. Consumers walking in and watching digital orders fulfilled down the line while they stand around is a delicate process. Second make-lines, like those Chipotle fortuitously added before COVID, weren't widespread pre-virus. But will that become a more frequent practice on the other side of development? Shake Shack, for one, designed its first drive-thru, in Maple Grove, Minnesota, with a split-kitchen that boasts a separate kitchen dedicated just to drive-thru business. To help mitigate long lines, employees take orders and payment at multiple points along the journey.
As Liz Moskow, food futurist and principal at Bread & Circus, says of a recent experience: “They’re basically saying, we prefer not to interact with you. And you’ll get preference if we don’t. … What’s happening is people are going in-store for an in-store experience and they’re not getting eye contact. And they’re not getting the human elements—the touch that they’re looking for in-store. And so, it’s driving it more to digital, even though what the consumer is really craving is that hospitality touch.”
Figuring out how to excel on both will be a key separator this coming year.
Additionally, could it give rise to more automation? Miso Robotics chief strategy officer Jake Brewer believes so, among other triggers.
“2022 will be a proving year around all the hype of robotics in food that was created in 2020 and 2021,” he says. “The full reality will set in that, while it might lessen, the labor shortage in restaurants is not an acute issue, and brands will need to expand their pilots and even rollout these solutions.
“2019-2021 for restaurant robotics felt a little like 1997–2000 with .coms—everyone knew it was the future, and money was flooding in,” Brewer adds. “2022 [and 2023] will be when we find out who can actually operationalize their product to solve the massive issues that aren’t going away.”
A sci-fi world into focus.
“I think that we will actually start seeing brand spec robotics as early as 2022 within their standard new-restaurant package,” he says. “Moving from trial to standard is massive. Big restaurant chains will expand and continue to trial the automation products on the market versus just ‘exploring.’ AI will also start to get to a point where even mom-and-pops will have access to that type of technology to trial. The tide has turned to technology and it won’t go back.”
Curbside isn’t getting kicked
Curbside pickup hasn’t just held up in terms of popularity—it’s proving a strong loyalty draw.
Per Oracle’s study, 58 percent love the method and are more apt to choose establishments offering it. Forty-three percent said it makes them more loyal to the restaurant. Fifty-four percent added they’d spend more for curbside, with that number jumping to 80 percent for millennials.
David Portalatin, food industry adviser at The NPD Group, says digitally ordered for pickup is actually a larger behavior than delivery. And it’s growing as fast, if not faster. It simply doesn’t garner as many headlines.
“So whether the food is obtained through a drive-thru window or curbside, or at the counter inside the restaurant, that digitally ordered for pickup is a really large and fast-growing behavior and I think, while we believe delivery is still going to grow, you’ll see the top-performing chains be the ones that really know how to lean into digital to unlock a higher capacity of off-premises occasions that the consumer picks up,” he says.
Naturally, the biggest reason curbside blossomed in 2021/2022 was a desire for contactless service. Within short order, the option helped fast casuals and other brands close the drive-thru gap and plot ahead (think pickup windows). It doesn’t have to replace experience, either, software- and serviced-led enterprise provider NCR says. Contactless ordering and payment ensure safety, speed, and accuracy. For waitstaff, they can divert attention toward serving customers with a personal touch. The longevity of contactless ordering is why brands like Starbucks are building a suite of stores to satisfy demand, such as pickup units.
“With 38 percent of consumers noting they will be ordering carryout instead of dining out and 28 percent ordering delivery instead of dining out, contactless options will definitely be here to stay in 2022,” NCR says.
According to Oracle’s respondents, guests have grown to appreciate—and even expect—proactive recommendations from restaurants. Still, they want to control access to their own data.
Fifty-five percent love the idea of receiving notifications about personalized offers from restaurants based on their current location, while 45 percent want to be prompted with personalized order suggestions based on their purchase history.
Forty-six percent would love to manage their dietary preferences with their favorite establishments and 56 percent would love visibility and control over who has access to the personal data they share with restaurants and delivery drivers.
NCR says “what consumers find creepy or cool when it comes to personalization has evolved considerably.”
Imagine 20 years ago a drive-thru worker knowing your name and order preferences before you pull up. The customer might have peeled out toward the police station. Now, loyalty programs and smart technology have turned the practice into a differentiator. Ninety percent of consumers, NCR said, find personalization appealing.
Yet there are hurdles to consider. “With a culture of a data sharing, and pressure to personalize to remain competitive, next year, restaurants will make more of an intentional effort to not cross the creepy line,” Dirk Izzo, president and GM of NCR Hospitality, advises. “It will be critical to understand what consumers expect and the products they love, but also important to steer clear of any invasive practices.”
An example Izzo outlines: For instance, data enables you to know a patron—let’s call her Mary—regularly purchases a strawberry sundae with extra whipped cream and nuts. This data also gives the eatery the ability to greet her in the drive-thru with a “Great to see you again Mary. Can I get you your regular sundae served up your way?” She’ll appreciate the brand knows what she likes and will remember it. But what she won’t appreciate is if you generate recommendations based on her personally identifiable information like address, neighborhood or personal life.
All of this returns restaurants to technology. According to Tech Jury, the data analytics market is expected to reach $103 billion by 2021. More than 97 percent of organizations are investing in data and AI—restaurants included, Izzo adds. Personalization allows brands to reach out to customers though several touchpoints that bolster the customer journey: the drive-thru, men board, branded apps, kiosks, and loyalty programs.
Burger King uses Deep Flame technology in its new digital menuboards to suggest foods popular in a certain area. It even measures outside temperature to offer hot coffee if it’s cold or a cold glass of iced-tea if it’s warm. McDonald’s and Dynamic Yield are blazing a similar path with food choices recommended from weather, time of day, and geo-trends.
“Personalization has even been deemed the Holy Grail for restaurants, especially since customer loyalty can help increase sales,” Izzo explains. “Invest even more in tech tools that deliver personalized dining experiences and boost sales.”
Consumers are increasingly influenced by a brand’s sustainability, environmental, and corporate governance, Oracle’s study discovered. The same is true of healthy meal options.
Sixty-one percent of millennials rated efforts to lower food waste (such as donations to food banks) as vital and influential to which brands they spend money with. Forty-five percent said clear labeling about source of food and ingredients was vital, with a slightly higher mark of men versus women (48 compared to 42 percent).
In addition, 58 percent of consumers said healthy options on a menu were important. Families rated this highest at 74 percent. Millennials next at 71 percent.
Let’s talk more about ordering preference
Once again, restaurants find themselves trying to offer the best of both worlds, and not skimp on either. Mobile ordering isn’t subsiding. But it doesn’t mean human interactions, as Moskow pointed out, should be tossed aside.
Sixty-five percent of Oracle respondents said they prefer to order directly from a server when dining in, while 18 percent would like to order from their mobile device. When ordering takeout, 33 percent want to go directly through a restaurant on their mobile device; 18 percent from a third-party (also via mobile); and 25 percent directly from a server.
Thirty-eight percent said they prefer to order directly from a server when getting drive-thru; 43 percent would rather order from their mobile device.
Fifty-two percent of millennials said they’d rather order from a service in-person. However, the number drops sharply at drive-thrus, with only 17 percent wanting to deal with a staff member, and just 11 percent for ordering takeout.
NCR’s Izzo expects operators to continue leaning into technologies like order and pay-at-the-table options, mobile ordering and curbside in the year ahead—all in an effort to increase efficiency and decrease the number of staff needed (the labor topic rears again).
“They will also turn to data for more accurate forecasting to improve restaurant operations over time. Things like customized tags and cost reporting can create detailed, valuable forecasts,” Izzo says. “Accurate forecasts help drive ‘smart’ restaurant operations, like using daily sales to drive inventory decisions in smart ordering or smart prep. Forecasting can also help inform employee schedules that optimize your labor spend.”
The constant phase of improving processes through automation, lit on fire by COVID, has led to an omnichannel approach to giving guests what they want. A key there, Izzo says, is to depend on IoT solutions; connected and smart technology to deploy systems like self-order terminals, interactive menu boards, drive-thru automated kiosk, and delivery systems.
Not to be forgotten: an interoperable point-of-sale platform that integrates everything, allows for dynamic adjustments, and operates at optimal efficiency, Izzo notes.
The payment options themselves are expanding, too.
While cash is still high on consumers preferred ways to pay (47 percent), according to Oracle’s data, restaurants are adapting to new forms of payments to meet changing expectations: 60 percent of consumers like to pay with a credit card; 25 percent prefer to use contactless payment methods such as Apple or Google Pay; and 7 percent are embracing alternative payments such as cryptocurrency.