Competition is fierce in the quick-serve restaurant (QSR) space, and technology is increasingly being used as the tool of choice to gain and retain customer loyalty.
QSRs to deliver a superior customer experience with every visit. Many are using digital technology to do that, including tools that streamline ordering and payments, both in-store and via mobile applications. Mobile apps also help QSRs get to know their customers better, enabling them to use the insights they glean to drive marketing programs and gain a competitive advantage.
This increased reliance on technology is prompting QSRs to take a hard look at their technology platforms and networks to determine whether they’re up to the challenge in terms of performance, reliability, scalability, and security.
“Often, QSR managers opt for a managed service provider to do the heavy lifting in terms of tech installation and even on-going management rather than dedicating restaurant staff to technology tasks,” says Donna Cobb, Executive Director, Enterprise Marketing for Comcast Business.
“That’s been a big discussion point with the QSRs we work with, who are great at what they do—cooking food and serving customers,” she says. “They want to ensure technology can be installed and maintained but without disrupting operations.”
There are nearly 200,000 QSR franchises dotting the U.S. landscape and customer spending sets new highs every year. In 2018, customers spent $299.6 billion at QSRs, up from $187 billion in 2004, according to the research firm Statista.
A study by Deloitte confirms technology is helping to drive that growth. It found that nearly half of customers wanted to pay using their phone, especially drive-through and take-out customers. Of those, 50% wanted to do so using the QSR’s app.
And here's the kicker: When technology was used to place an order, the average spend increased 20% and the frequency of visits increased 6%, Deloitte found.
“It’s clear that technology can help boost customer loyalty as well as revenue. Upgrades often pay for themselves quickly,” Cobb says.
When it comes to changing experiences through technology, customers are looking for convenience in one area more than any other: the ordering and payment process.
Mobile applications that enable guests to place an order and pay in a single transaction are one way to streamline the payment process. Such apps also typically drive loyalty programs, offering guests points, discounts or other offers.In-store kiosks for ordering and paying are also gaining traction, Cobb says, with some even supporting facial recognition capabilities that enable the kiosk to “welcome back” a customer.
Mobile apps and kiosks can also present opportunities to upsell customers, such as suggesting a dessert, drink, limited-time offering, or an item from a past order. It's these capabilities that drive the 20% increase in spending from mobile orders.
Offering customers access to an in-store WiFi network is also becoming table stakes, as customers increasingly expect to be connected at virtually any public establishment. Guests are accustomed to blazing fast speeds at home, so any dropped connections, buffering, or lagging speed while they’re logged onto a guest network is a major source of dissatisfaction. In fact, in some cases, slow WiFi is worse than no WiFi at all.
Additional forward-looking technologies include automated checkout, which can take at least a couple of different forms.
One is when a customer places an order from a mobile app for in-store pickup. When the customer enters the restaurant, beaconing technology and analytics that operate over the WiFi network recognize the customer and checks off the order as paid, enabling the customer to grab the order and go.
Another variation is placing mobile orders in an in-store locker. Upon arriving at the restaurant, the customer scans a code from their phone to determine which locker the order is in and to unlock it.
In addition to all of the customer-facing technology, QSRs are also implementing back-of-house technologies to streamline operations and increase sales.
Artificial intelligence is gaining traction, as QSRs experiment with capabilities such as using AI to make ordering suggestions and drive upsell opportunities. Say an AI-enabled CRM system recognizes that a customer in the store ordered a milkshake in the past, so a mobile app or kiosk offers it as a suggestion, personalizing the experience.
“AI-driven applications can also offer customers coupons to entice additional visits. If a family comes in once per month and shows a clear preference for chicken over beef, an AI application may entice an additional visit by offering a coupon on chicken items,” Cobb says. If even a small percentage of recipients take up the offer, that’s significant additional revenue to the bottom line.
Point-of-sale (POS) systems are also becoming increasingly integrated with other functions to streamline operations. They can integrate with CRM applications to help drive loyalty programs and personalization or, on a more basic level, send signals to other parts of the restaurant to automate order creation once a customer has placed an order. For example, if a customer orders a chocolate shake, the POS can send a signal to the shake machine to start preparing it.
Cloud-based POS systems are also growing in popularity, with lower start-up costs, on-demand support and easy centralization of information. Going to the cloud for point of sale, however, doesn't necessarily eliminate strain on the network. Given the tight integration, a cloud POS system will have with other key systems across the business, fast connectivity is as important as ever.
Some restaurants are also now employing hands-free access to data via voice commands, such as to check on the status of orders, staffing schedules and more. Others have voice-controlled applications that managers can use to streamline inventory tasks, resulting in significant time savings.
Implementing all these technologies requires having a technology architecture that not only delivers fast connectivity, but that is also flexible, reliable and secure. Companies are increasingly relying on software-defined and virtualized network services to address all of those requirements.
Software-defined wide-area networks (SD-WAN) are one example. For QSRs to function properly, they need a network that meets three fundamental criteria. The network must be:
Reliable, to ensure applications work as promised at all times.
Scalable, to keep up with increasing demand as more customers adopt mobile technologies and QSRs roll out new applications, as well as seasonal variations in capacity.
Secure, to protect confidential customer data. Breaches are unacceptable, both in terms of the dollar cost to address them and the damage they can do to a QSR’s reputation.
By abstracting network control functions from the underlying network, SD-WANs enable QSRs to choose the WAN service option that most closely matches the requirements for each application. Some may require the performance and deterministic characteristics that private lines provide while others may be served by lower-cost Internet links. SD-WAN also makes it simple to configure backup links, using Internet or wireless services as secondary options to ensure reliability. And security services such as firewalls and intrusion detection/prevention are typically built into the SD-WAN appliance at each QSR location. The physical or virtual appliances also make the service simple to deploy, which is important for restaurant chains that are not likely to have IT personnel at each location.
SD-WANs help QSRs modernize their networks to support growth and business innovations that are important to gain customer loyalty. They also allow IT the visibility and control they need to manage multiple distributed locations through a centralized, single pane of glass, or even from a mobile device. Simple policy management and control ensure IT can define user and service policies for each site, right down to assigning each application the bandwidth it requires.
With the ability to easily configure backup options should a primary WAN connection fail, SD-WANs also ensure reliability and business continuity.
Quick-serve restaurants are fortunate to be in a period of record spending, but the competition for those customer dollars is fierce. The differentiation between leaders and laggards is increasingly coming down to the technology these restaurants use to enhance customer experience and streamline operations. Comcast Business has the solutions to enable transformation and help QSRs go beyond expectations. To learn more, click here.
Business is booming in the QSR space: from mobile apps and kiosks to AI, technology is becoming increasingly important for franchises to compete effectively.
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