When Taco Bell launched its first app three years ago, it was just about basic functionality—sharing a menu, location information and the like. But when the brand reimagined mobile late last October, it sought to match the big-thinking functionality of the new app with an equally gutsy marketing campaign to announce it. The chain went dark on all of its social media platforms for one day, posting only one simple message: #OnlyintheApp. The effort did exactly what the brand hoped it would do. Within a day, Taco Bell’s app was among the top 25 mobile apps on iTunes, and 75 percent of its stores had processed a mobile payment that came from the app. It was more than just a slick ploy, however. Now, nearly a year later, the app’s been downloaded more than 3 million times and usage and downloads are continuing to grow quickly.
Few can argue with Taco Bell’s success, which the brand attributes to its commitment to push the boundaries of what mobile can do. But, “there’s still so much potential for this entire mobile space,” says Mark Brandau, content manager for Chicago researcher Technomic.
While most consumers have smartphones, he says, many don’t use them to interact with brands. In fact, only one in four have downloaded a restaurant app, and even fewer use them for higher-level functioning, he adds. That lack of adoption, he suggests, comes from restaurant brands (Taco Bell excepted) not being aggressive in their marketing of apps to get trial. But more consumers are starting to catch on on their own, and usage is growing for forward-thinking brands that go beyond the basics of what mobile can do.
“People really are moving from just having an app to layering in valuable functionality and doing it faster,” Brandau says. “The time it takes to start and add bells and whistles is getting shorter. To be used, [an app] needs to offer more than the aesthetic things you find on a desktop site.”
The trick is not only figuring out what those bells and whistles are, and integrating them seamlessly into operations, but staying one step ahead. And there are a few platforms already changing and shaking up the next iteration of restaurant apps.
Targeting brand loyalty programs
Often seen as the easiest place to dip a toe in the mobile-app pond, loyalty is the frontier that a lot of operators are trying to tackle. Yet restaurant apps still are the least popular method for consumers to collect and redeem rewards. Just 35 percent of consumers use loyalty programs linked to their phone at restaurants, while 39 percent prefer paper punch cards and 62 percent use swipeable loyalty cards similar to credit cards, finds Technomic. “Mobile loyalty still hasn’t overtaken punch cards or swipe cards, but it’s only a matter of time,” predicts Brandau, as overall app adoption steadily increases.
While the typical loyalty program mimics a digital punch card (buy 10 salads, get one for free), those who’ve gotten a handle on data analysis are creating targeted marketing campaigns that increase guest engagement with the brand. “Based on the data we’re collecting, we can [better] custom tailor our messaging to our customers based on personal preferences and buying patterns,” says Jason Smylie, CMO and chief information officer of the Capriotti’s Sandwich Shop chain. “We’re just at the tip of the iceberg, but it’s exciting to see how much of a difference it will make.”
Chicago-based Argo Tea has had success with its loyalty campaigns—many of which are only available to app users—says Director of Marketing Dana Dimitri. Through its loyalty program, “we can track who comes in, when they come in, what they’re ordering, the frequency of orders and their average transaction and engagement,” she says. This helps in crafting campaigns tailored to specific diners who, for example, always order the same thing, come in at the same time or add food to their order.
Argo also is able to understand the effectiveness of each mobile campaign to help determine whether or not it’s worth doing again—letting tech and stats take the guesswork out. “All of our campaigns have a control group. We’re able to determine if it actually helped drive traffic,” she says.
Gathering data is just one step. The key, of course, is knowing how to interpret and leverage it from a marketing standpoint. Argo’s app partner provides one integrated dashboard that showcases financials, actual campaigns, consumer information and more. “It’s easy for me to go online and see what’s happening. It’s a very simple, clean, straightforward process,” says Dimitri.
Other brands have dedicated teams in place. At Schlotzsky’s, parent company Focus Brands has an entire consumer insights group to help read the data the brand collects from its loyalty app and provide insights as Schlotzsky’s plans its marketing calendar, says Jamie Schlef, senior director of marketing at the chain. Schlotzsky’s also gets reports from its app provider.
Even for brands without an app provider, doing it all in-house, “we’re always learning and living in the data,” says Tressie Lieberman, Taco Bell’s VP of digital innovation and on demand. But it’s not just the numbers. “It’s important that our team is agile and understands feedback.”
Innovative mobile ordering systems
At this point, most brands that have ventured into mobile ordering are focused on two factors: building a following and making sure online orders don’t negatively impact throughput. And they are seeing results, albeit slow ones.
“Mobile ordering is still a small portion of our business, accounting for just a couple percent of our orders, but it’s growing rapidly,” says Smylie. “Exponential growth always starts small. I’m certain it’s going to eventually outpace call-in orders.”
Yet for some brands, such as Domino’s, that boom already has happened. The chain has more than 15 million downloads of its app, and more than half of its orders come through mobile. Much of that success, it suggests, can be attributed to its try-anything approach and constant trolling for new technologies.
As part of the brand’s AnyWare campaign, Domino’s IT team—the largest group at its headquarters—constantly is adding new platforms to make it easier for customers to order from whatever tech device or interface they’re comfortable with.
“Consumers shouldn’t have to choose,” says VP and Chief Digital Officer Dennis Maloney. “Twitter and one-text ordering came out of that campaign,” he says. “Few brands are using Twitter as an ordering platform or figured out how to make text ordering easier.” Ordering through the TV and in-car ordering—two more fledgling platforms—also came through that campaign. But the wave of the future, predicts Maloney, will be voice ordering; its DOM app function already is in place. “It’s an interface that will be adopted broadly in coming years,” he says.
An ordering frontier where Domino’s and others are breaking ground: wearables. Smartwatches haven’t been widely accepted by consumers—it’s still not mainstream and is at the beginning stages of innovation, said researcher NPD Group in its Connected Intelligence Consumers and Wearable Report. Yet, Domino’s released its app for the Pebble and Android Wear smartwatches earlier this year. Chipotle, a brand that’s said a loyalty app won’t work for its concept, partnered with Apple to roll out an app for the Apple Watch launch in April. Chipotle’s smartwatch app is designed to make ordering fast and convenient for repeat customers by saving recent or favorite orders. And with the flick of a wrist, the app provides a countdown to when the order will be ready.
That one-motion-to-use capability is one that Taco Bell also has found success with, says Lieberman. In its app, repeat users can take advantage of a Rotate-to-Reorder function simply by turning their smartphone sideways for a one-step reorder. “We really want to create a magical experience for our customers with technology you can’t see,” she says. And that seamless, intuitive ease-of-use, she predicts, is part of why Taco Bell’s app has been a raving success.
Another reason for its success, Lieberman says, is that the app now is designed to drive customization. “We’ve unlocked the menu for our customers and unlocked the ability for them to be the chef in our app. They are adding new things to the food,” she says. And that means upcharges. Taco Bell’s digital orders are 20 percent higher through the app, compared to drive-thru and walk-in orders, says Lieberman.
Geofencing app: next-level marketing
Instead of letting rewards sit stagnant within a customer’s app, Elephant Bar pings mobile-loyalty members when they get within two miles of a store. Tech allows the chain to detect when they are nearby and send a message that appears as a text to remind guests of the rewards they’ve accumulated. The strategy behind adding this geofencing technology, says the chain’s Senior Marketing Manager Suzanne Gross, is to cut through the clutter of email marketing to boost engagement and get additional visits. Thus far, it’s working. Some 40 percent of users who got geofenced messages visited the restaurant and had a transaction on their account the day they got the message.
And it’s also helping the marketing team get even more targeted with their messages. “It gives an added layer of finding when is a good time to target guests; it helps us narrow it down if we want to do a specific promo,” Gross says.
“But we don’t want to annoy people or be intrusive and cause them to delete [the app],” she says. So the brand has parameters in place: Users will only receive a message every four days, and only during the restaurant’s hours of operation. “We’re not fast food, so it does no good to remind people daily … and we don’t want [a message] popping up when we’re not open,” she says.
Sister restaurants Mani Osteria & Bar and Isalita Cantina Mexicana, located in Ann Arbor, Mich., integrated an app with geofencing capability in late 2014. While most concepts are using geofencing to push deals, they are using it as a tool for managers and staff to build and retain relationships with guests, says owner Adam Baru.
While there is a loyalty aspect to the app for guests—the hook that gets them to download it—there’s a back-end side of the app for staffers. “It’s the No. 1 reason I’m excited,” says Baru. “We can see when a guest walks in; it’ll pop up on my phone, tell me his status, what visit this is, his average spend. There’s also a picture [that guests upload to their app profile] to help me identify him, all in the palm of my hand.” While that part of the app initially was only used by managers, Baru added iPads back of house in both restaurants that display the same information for servers to see. “It’s now more immediate and the servers catch it, versus the manager telling them,” he says. And it takes the guesswork out of trying to create that “Cheers” experience. No more worrying about recognizing everyone’s faces; the app helps staff capture opportunities to recognize repeat guests, he says.
Working apps into restaurant pos systems
Games, ordering and cool features are a piece of the puzzle—one that matters to consumers—but more important is how all of the components interact with the restaurant’s back-end system. “It’s very difficult if you don’t have a standardized, synchronized POS that can handle all this function and data in one place,” says Technomic’s Mark Brandau. “So much revolves around transactional and consumer data, so the linchpin is having a central place to collect and analyze [that data].”
Domino’s corporate team had the foresight to get its system on the same POS years ago, says Dennis Maloney, long before it rolled out an app. “It was important, so we weren’t constantly integrating three, four, five times in different systems,” he says.
While brands such as Domino’s or Taco Bell have in-house teams dedicated to making sure all of the functions work on the back end, for others, choosing the right vendor is crucial. “We carefully selected a vendor that could integrate with our existing technologies,” says Capriotti’s Jason Smylie. “Selecting the right partner that is nimble, innovative and on the same page in terms of vision has been key in avoiding integration challenges.”
Engage customers with a free game
For an app to be successful, consumers need to interact with it. In-app entertainment is one way some brands are trying to build in extra time with the app and the brand. While some may question the value of games to the top line, when some of the darlings of the mobile world make a move into this realm, it’s worth taking note.
Two years ago, Chipotle was able to drive more than half a million downloads of the mobile game associated with its Scarecrow marketing campaign. It certainly wasn’t the first in-app game, but it created a lot of buzz for its sheer reach and ability to promote the brand’s messaging.
Dave & Buster’s recently added a function to its mobile app that invites users to play video games similar to what they’d find in the restaurants. From the app, there’s a clear, direct link to the in-store experience; guests can win real tickets that they can redeem for prizes in-store.
“The next thing we have is going to be a game where people can engage,” says Lieberman, who says her Taco Bell team is always looking for ideas on how to drive loyalty. “When you create the right experience, it’s amazing how quickly customers will gravitate.”