Edit
Technology

KFC’s future: Online ordering, more delivery and artificial intelligence

The company wants to simplify its ordering as customers demand more takeout and drive-thru.
Photograph courtesy of KFC

KFC launched online ordering about a week ago, just as it put chicken wings on the permanent menu. The company said almost nothing about it, other than some signs in some of its restaurants.

“We launched it last Monday without any media,” said Christopher Caldwell, chief information officer for KFC U.S., in a statement. “The only people who happened to see it were those who went to kfc.com.

“We saw a big uptick in orders right off the bat.”

To Caldwell, the response is indicative of the way consumers are interacting with restaurants these days. They increasingly expect restaurant chains to have online ordering on their websites. That’s one thing they’re looking for when they go to a company’s website.

“People expect now if they go to branded websites that ordering should be there for them,” Caldwell said, noting that there is “pent-up demand” for the service.

KFC’s technology strategies go well beyond the ability to order food from a website. The company is adding delivery, thanks to parent company Yum Brands’ investment in third-party provider Grubhub. And the company has tests coming to increase the efficiency of its drive-thru, including the potential use of artificial intelligence to take orders.

“What I’m focused on from a tech perspective is to continue to drive sales by making our brand easier,” Caldwell said. “Anything we can do to simplify the process and make it easy and relevant for consumers.”

Technology is a major front in the ongoing battle between restaurant chains as they seek to make themselves more convenient. Takeout and delivery are particularly important. Technomic and the National Restaurant Association recently said that nearly 60% of restaurant transactions are takeout.

Adding these services has other benefits besides convenience. Online ordering, for instance, comes with an average check that is 60% higher than normal, and the business is “highly incremental,” meaning consumers are likely going online looking to order a meal.

Delivery also comes with a higher average check. KFC has the service in about 2,600 of its 4,000 locations. Caldwell expects that number to get to about 3,000, or about 75% of its units, by the end of the year.

“It’s been a real slow build,” Caldwell said, noting that the company wanted to integrate the service into its existing point-of-sale system to avoid putting tablets in its restaurants. “We’re being really strategic to make sure we have things right before we proceed with the national launch and media.”

KFC started marketing delivery last week in association with the addition of chicken wings to its permanent menu. “The last piece is to build full awareness,” Caldwell said, noting that early results have been promising.

KFC believes that delivery is a big potential avenue for growth: Fried chicken holds well, and it’s popular with large groups, which are more likely to have their food brought to them. The chain believes chicken wings are a particularly delivery-friendly item.

The next frontier for the chain is the drive-thru, which accounts for nearly two-thirds of KFC’s store orders.

The company plans to test digital menu boards next year and could include artificial intelligence to personalize the process. That would help the chain keep pace with larger fast-food chains like McDonald’s that have been aggressive in adding digital menu boards in its drive-thru.

With all of this delivery, online ordering and more technology comes information. Down the road, KFC wants to do more with it.

“Right now we’re just trying to get mass reach,” Caldwell said. “Now that we’re in the online ordering game, as time goes on, we want to use consumer data to make sure we’re communicating with customers on a more personalized level.”

Want breaking news at your fingertips?

Get today’s need-to-know restaurant industry intelligence. Sign up to receive texts from Restaurant Business on news and insights that matter to your brand.

Trending

More from our partners