If there was one technology-related theme that came out of this year’s Restaurant Leadership Conference, it was that the industry is not quite there yet. From loyalty programs to mobile apps—with Starbucks and Panera Bread being the big exceptions—chain restaurants haven’t found the perfect combination of capabilities that fit their operation’s tech needs. For some, there are integration troubles or back-end bugs. But for most, the struggle is finding the right combination that enhances the guest experience enough to drive traffic—and deliver an acceptable ROI.
These technology growing pains—as Dawn Sweeney, CEO of the National Restaurant Association, called them from the main stage—are to be expected, as tech no longer is a novelty or nice-to-have feature. “Virtually everything we’re implementing these days has an IP address,” said Jeff Dinard, CIO of the On The Border casual chain. And that, many RLC attendees observed, means bringing IT into the c-suite, especially when it comes to marketing and operations.
As operators continue to integrate technology, restaurants will likely focus on closing the divide between what’s on the market and what’s needed, Sweeney said. But for now, here’s where we’re at.
1. Technology hasn’t solved friction issues yet.
Two out of five consumers say technology makes restaurants and ordering more complicated. Still, one in four say tech is important when choosing a restaurant, said Hudson Riehle, senior vice president of the research and knowledge group at the NRA. Consumers report benefits in both convenience and accuracy, he said.
2. Implementation varies widely.
From brand to brand, the emphasis and amount of people and time devoted to tech are in flux. Multiconcept franchisee Flynn Restaurant Group sees the differences even within its own concepts—Panera is a big tech-based operation, with somewhere around 300 people devoted to it, said Ron Bellamy, its chief improvement officer. “You compare that with Applebee’s, where we have a router and a PC,” he said.
3. Tech’s operational capabilities are valued—but often unrealized.
It’s not just about improving the consumer experience. Operators are trying to find solutions to kitchen throttling—backing up the cooks and messing up prep times because orders are flooding the back of the house from multiple channels. Restaurateurs are looking at options like commissaries and central kitchens, off-site call centers and second cook lines. Still, scheduling labor during peak times is becoming increasingly difficult, said Darren Tristano, president of Technomic.
Yet tech’s promise as an operational enhancement is not being overlooked. Don Fox, the CEO of Firehouse Subs, asked about a data point in a presentation from Deloitte Consulting. Did it really say that remote ordering could cut food costs by three to five percentage points? Absolutely, said Andrew Feinberg, a Deloitte principal. Orders placed via smartphone or website are more accurate and provide the intelligence to match demand and supply more precisely, which reduces food waste, he explained.
4. Mobile pay isn’t there for full service...
“We’ve dipped our toe in the mobile-pay water, but the water is freezing,” said On the Border's Dinard. “It’s a little clunky and not error free; nobody really figured this out in table service.” One big issue: tipping. Servers can’t hand over their tablets and walk away, but they can’t stand and watch guests enter a tip either; it’s awkward, said Dinard.
6. Full-service apps aren’t there, either.
Consumers only have and use a limited number of apps on their phones—in fact, they spend about 84 percent of their time in their top five apps, said Zach Goldstein of Thanx. Many casual-dining chains have resisted having apps just for the sake of adding them, as frequent diners are less prevalent than in the QSR or fast-casual spaces. “They need to add value,” said Chris Tomasso, president of the First Watch breakfast-and-lunch chain. Unless a consumer is a frequent user who comes in more than twice a week (10 to 15 percent of guests), says Brittany Maroney, director of marketing for Grimaldi’s Pizzeria, apps aren’t a fit for them. “Picking up this tech is expensive, so until we can learn how to adopt and use data to the fullest advantage, it’s not worth it,” she says.
7. It’s not all apps; websites have to be mobile-friendly too.
About half of all restaurant searches are done on a smartphone, said Clay Dover, CMO of Pei Wei. Of those, 50 percent of millennials are making purchasing decisions on their smartphones, about a third within one hour.
8. Despite the hype, tablets still are at the test phase.
David Bliven of On The Border said the chain has handheld tablets in 50 percent of its stores to test that means of entering orders. The chain is not only looking to increase speed of service but also to improve server training. New hires don’t have to be crammed into a tiny back office to use a training POS station. Also, staffers can move from the floor to the cook line to see the process in real time. On The Border started with large tablets in shoulder slings for servers—which didn’t work. It’s now using smaller devices. Grimaldi’s, too, is looking at options to do training on mobile devices. While it initially discouraged cellphones on staffers, now it’s putting QR codes on training materials that’ll take staffers to YouTube.
9. Beacons are the bleeding edge.
“Beacons are really interesting … but for us, for now, I’m not sure what the use is. And I’m a little concerned about investing in something without knowing the clear business use,” said Jayson Tipp, SVP of technology and chief development officer for the Papa Murphy’s take-and-bake chain. Similarly, PeiWei's Dover sees location-based mobile paging—sending out messages to customers when they are in the restaurant—as a little out there right now.
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