Top 5 Trends Disrupting the Restaurant Industry in 2019
To succeed, restaurants must stay on top of the trends that are transforming the ways people interact with their favorite dining options. Operators have to think of themselves as technology companies as much as they are food and beverage purveyors. The new environment requires maintaining the personal touch even as most consumers shy away from human interactions. Here’s a look at some of the top trends reshaping the industry as we know it.
Changing customer behaviors
Customer expectations are driving much of the technology and service transformation. Amazon has set the bar for convenience and customer service. Consumers expect to be able to review menus, ask questions and place orders using mobile devices and computers. Chatbots are replacing phone calls for information queries. If you collect data, customers expect you to use it to make their lives easier, such as tracking orders, so they don’t have to remember the name of their favorite carryout dish. Any restaurant that lags behind could be shedding market share without realizing.
Research from Technomic shows 90 percent of Americans order takeout at least once a month, and Millennials and Gen Xer’s spent 56 percent of their restaurant dollars on takeout and delivery. Customers expect to order via any channel that’s convenient for them: voice, online or mobile. While voice is still by far the most popular ordering option, other technologies are gaining favor and will represent a more significant share in the future.
Some restaurant owners wonder if they are cannibalizing their own traffic, turning away on-premises diners. Typically, a carryout/delivery order represents incremental revenue — if it’s convenient, consumers will order from their favorite place rather than cook for themselves. The option usually isn’t between dining in and carry out, but between purchasing food in any form or making the meal at home.
Airlines led the way with self-service kiosks, and some quick-serve restaurants are finding the technology pays off with upselling opportunities. Conditioned by mobile e-commerce, some consumers want service with as little human contact as possible.
Research shows self-services kiosks reduce order time by up to 40 percent and increase average order size by 21 percent. For instance, Taco Bell found that customers were more likely to order add-ons such as extra sour cream or salsa because the kiosk never failed to upsell the customer. Keep in mind these systems must communicate with your current point of sale and accounting systems to avoid financial chaos.
Serving business lunches, civic groups, sports teams and other group functions represents a growing trend for established restaurants. Consumers want to enjoy food from a well-known restaurant rather than rubber chicken and steamed vegetables from a catering company. Some restaurants classify orders over a certain level, such as $100, as a catering order, so you may be in the catering business without realizing it.
Some chains have launched catering services aimed at business lunches and offered a selected menu of soups, salads, and entrees via a third-party catering platform. Other options include “bar” type offerings such as a taco bar or burger bar.
Catering can also be seen as a marketing strategy. Delivering a great experience to a captive audience of local business people could lead to new customers.
Drive for increased revenue per square foot/employee
Off-premise dining, assisted by technology, will allow restaurants to generate revenues beyond what their in-store footprint could manage. New restaurants are swapping customer-facing spaces for food prep square footage to support more carryout and delivery traffic. The goal is to drive higher revenue throughput with lower real estate and labor costs. One way to do that is to use a call center for off-premise sales to free up in-store staff to handle customers in the store.
Today’s consumers care about more than just food — they value the entire experience of interacting with a restaurant, regardless of the channel. If you’d like some insights into integrating the latest technology in your operations, contact us here.