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Chicago has a new e-commerce rock star

Crain’s Chicago Business – Grubhub is now the top performer among local publicly traded companies over the past 12 months as it expands its restaurant delivery business and beats financial forecasts.

It helps that Grubhub is beating Wall Street’s forecasts, showing record growth in the second quarter, for instance, in what traditionally are its slowest months of the year. To underscore the point, the company raised its financial targets for the year.

A big driver is delivery. Maloney was happy to handle online orders, but he resisted getting into the delivery business, a low-margin hassle. That changed three years ago, when Grubhub acquired several early players and has built out its own network.

Grubhub also got deeper into restaurant technology, another messy business, integrating its mobile app directly into point-of-sale systems. It’s a key reason for the LevelUp acquisition. “If we’re going to grow the business, we have to go to where our customers are and relieve them of their burdens,” Maloney says. “I’m able to do delivery at scale more efficiently than 80,000 individual restaurants can. The same is true of POS integration.”

One risk is technology. “Grubhub has grown in terms of locations and geography. With that growth have come these land mines of complexity, integration and execution,” says Scott Langdoc, a San Francisco-based senior vice president of BRP Consulting, which advises restaurants on strategy and technology.

Read Full Article: Chicago has a new e-commerce rock star

Food Customers’ Expectations Rise as Technology Evolves

Convenience Store Decisions – Digital technology continues to shape customers’ expectations when dining out. According to a new report from Boston Retail Partners (BRP) and Windstream Enterprise, rapidly evolving guest expectations and digital technologies are driving a major transformation in the restaurant industry.

“The Restaurant Digital Crossroads: The Race to Meet Guest Expectations” report, based on research conducted by Incisiv and sponsored by BRP and Windstream Enterprise, combines findings from surveys of 1,225 restaurant guests and 60 restaurant executives.

“As guest expectations continue to rise, restaurants must transform their business with new technologies to make the dining experience more seamless and frictionless,” said Scott Langdoc, senior vice president and practice lead at BRP. “Unfortunately, many restaurant brands and franchisees have a long way to go to catch up to guest expectations. The good news is that restaurants are aware of the gap and their future plans include enhancements to key areas that guests deem important for a great experience: ease of ordering and payment, WiFi availability, and mobile POS.”

Ease in Payments And Ordering Are Central to Restaurant Success, a Survey Finds

Digital Transactions – What do diners want most when they go out to eat? Apparently, easy ordering and payment. That’s the big takeaway in the “Restaurant Digital Crossroads: The Race to Meet Guest Expectations” report released Thursday.

Hassle-free ordering and payment are especially important to younger consumers, defined as those between 18 and 37 years old. Seventy-four percent of them said ease of ordering and payment is extremely important to them, yet only 45% of restaurants meet that expectation, found the report from Boston-based BRP Consulting, which specializes in retail and restaurants.

“For Millennials, digital is shorthand for taking friction out of the order and payment process, allowing them to shop the way they want wherever they want,” the report said. “They, along with Gen Z, also value interactive technology and digital content (music, movies, games, digital shorts) more so than older generations.”

While restaurants whose primary guests may not have the same expectation now, BRP says such demands will become “table stakes in two years.”

Read full article: Ease in Payments And Ordering Are Central to Restaurant Success, a Survey Finds

New Survey Findings Confirm the Digital Lag between Guest Expectations and Current Restaurant Technology

The team at BRP is excited to have sponsored (along with our parent company Windstream Enterprise) a new report titled The Restaurant Digital Crossroads:  The Race to Meet Guest Expectations.  The report was produced by Incisiv and details the research survey findings from 1,225 restaurant guests and 60 restaurant executives.  The central message derived from the findings was crystal clear to all of us – rapidly evolving guest expectations and digital technologies are driving a major transformation across the whole of the restaurant industry.

Looking deeper into the themes the survey data told us, as guest expectations continue to rise, restaurants must transform their business with new, digital-enabling technologies to make the dining experience more seamless and frictionless – period. Unfortunately, many restaurant brands and franchisees (and you know who you are) have a long way to go to catch up to guest expectations. The good news is that restaurants (both brand owners and their franchisees) are increasingly aware of the gap the report calls out, and their short and long-term future plans include enhancements to key areas that guests deem important for a great experience, including easing the of ordering and payment process, adding or improving guest WiFi availability, and mobile POS capability.

Restaurant guests expect (make that demand) a frictionless dining experience that empowers them with relevant, helpful information, all while making it MORE convenient for them to operate on their own time and at their pace.  This requires restaurant operators to embed a broader spectrum of digital technology across the entire dining journey.

As you would expect, the Millennial and Gen-Z consumer demographics have the highest expectations for digital capabilities. The report identifies significant gaps between what younger generations feel is extremely important and what current capabilities many restaurant operators have in place.  Specific examples of this gap from the Incisiv/BRP survey findings include:

Ease of ordering and payment – Guests expect the ordering and payment process to be easy and frictionless.

  • 74% of guests feel it is extremely important
  • 45% of restaurant operators state this capability is operating excellently

Guest WiFi availability – Guests expect fast and free WiFi in restaurants, especially where cell reception is limited.

  • 60% of guests feel it is extremely important
  • 44% of restaurant operators state this capability is operating excellently

Discounts and promotions – Guests expect to receive digital discounts and promotions on any platform they choose, especially their mobile devices.

  • 60% of guests feel it is extremely important
  • 35% of restaurant operators state this capability is operating excellently

There is a lot more data and strategic insight behind the excellent work Incisiv did on behalf of BRP and Windstream Enterprise.  I encourage you to download and read through the entire Restaurant Digital Crossroads: The Race to Meet Guest Expectations survey findings report:

Download Now

As always, I appreciate your opinions – both on the insight from the report and across the broader restaurant and hospitality space.  Please share your thoughts and opinions below.

Scott

71% of Guests Identify Ease of Ordering and Payment as Important yet Only 45% of Restaurants have Excellent Execution of these Capabilities, According to Recent Survey

Restaurant Digital Crossroads: The Race to Meet Guest Expectations Report Identifies Gaps Between Restaurant Execution and Guest Expectations

Boston, MA – July 12, 2018– According to a new report from BRP and Windstream Enterprise, rapidly evolving guest expectations and digital technologies are driving a major transformation in the restaurant industry. The Restaurant Digital Crossroads: The Race to Meet Guest Expectations report, based on research conducted by Incisiv and sponsored by BRP and Windstream Enterprise, combines findings from surveys of 1,225 restaurant guests and 60 restaurant executives.

“As guest expectations continue to rise, restaurants must transform their business with new technologies to make the dining experience more seamless and frictionless,” said Scott Langdoc, senior vice president and practice lead at BRP. “Unfortunately, many restaurant brands and franchisees have a long way to go to catch up to guest expectations. The good news is that restaurants are aware of the gap and their future plans include enhancements to key areas that guests deem important for a great experience: ease of ordering and payment, WiFi availability, and mobile POS.”

Restaurant guests expect a frictionless dining experience that empowers them with relevant, helpful information and makes it convenient for them to operate on their own time and at their pace.  This requires restaurant operators to embed digital technology across the entire dining journey.

The Millennial and Gen-Z generations have the highest expectations for digital capabilities. The report identifies significant gaps between what younger generations feel is extremely important and what capabilities restaurant operators are operating excellently:

Ease of ordering and payment – Guests expect the ordering and payment process to be easy and frictionless.

  • 74% of guests feel it is extremely important
  • 45% of restaurant operators state this capability is operating excellently

WiFi availability – Guests expect fast and free WiFi in restaurants, especially where cell reception is limited.

  • 60% of guests feel it is extremely important
  • 44% of restaurant operators state this capability is operating excellently

Discounts and promotions – Guests expect to receive digital discounts and promotions on any platform they choose, especially their mobile devices.

  • 60% of guests feel it is extremely important
  • 35% of restaurant operators state this capability is operating excellently

To download the complete Restaurant Digital Crossroads: The Race to Meet Guest Expectations report, visit:

https://brpconsulting.com/download/2018-restaurant-research-report/.

About BRP

BRP is an innovative retail management consulting firm dedicated to providing superior service and enduring value to our clients. BRP combines its consultants’ deep retail business knowledge and cross-functional capabilities to deliver superior design and implementation of strategy, technology, and process solutions. The firm’s unique combination of industry focus, knowledge-based approach, and rapid, end-to-end solution deployment helps clients to achieve their business potential. BRP’s consulting services include:

Strategy | Business Intelligence | Business Process Optimization | Point of Sale (POS)
Mobile POS | Payment Security | E-Commerce | Store Systems and Operations | CRM
Unified Commerce | Customer Experience | Order Management | Networks
Merchandise Management | Supply Chain | Private Equity

Diners Have High Expectations for Restaurant Tech

eMarketer – As in many industries, there is a gap between consumer expectations and business execution for restaurants. Operators are often slow to adopt new technologies and those that they’ve implemented aren’t always satisfactory.

In a February 2018 survey of US internet users and restaurant executives by BRP (Boston Retail Partners) and Windstream Enterprise, restaurant operators met consumer expectations on only two factors: contactless/mobile payment, for which 32% of consumers valued it and one-third of operators offered it, and Wi-Fi availability (44% both valued it and offered it).

Consumer expectations will be even higher over the next 24 months. The most important factor now (71%) and in two years (81%) is simply ease of payment, but just 45% of restaurant operators said they had “excellent” execution.  Two of the biggest jumps in consumer expectation between now and 2020 will be the ability to order ahead digitally (a 55% increase) and Wi-Fi availability (up 59%).

Read Full Article: Diners Have High Expectations for Restaurant Tech

Automating Hospitality

Hospitality Technology – The use of robotics is experiencing exponential growth with global robotics market revenues forecasted to grow from $28 billion in 2015 to $151 billion a year by 2020. Tractica predicts the majority of that growth will come from “non-industrial” robots. Scott Langdoc, senior vice president and practice lead at Boston Retail Partners (https://brpconsulting.com), says that the hospitality industry will not be immune to the increasing applications for machines taking on tasks once relegated to humans.

Hospitality Technology’s research reveals that robots are a burgeoning area of interest for hotels and restaurants. According to the 2018 Lodging and Restaurant Technology Studies, one out of four hotels (25%) named robotics a top emerging technology, and 33% of restaurants believe robots will make an impact on foodservice.

“We expect to see a significant increase in the deployment of both customer-facing and efficiency-oriented robots throughout the hospitality industry — both in terms of total robotic units deployed and in the number of hospitality locations using them,” Langdoc states. With dramatic improvements in cost, industrial design, and AI-based engagement capabilities, the number of potential robotic uses cases has tripled in the last 18 months.”

Though social acceptance of robots is increasing and more people are willing to use, touch and interact with them, many worry about what they see as the inevitable loss of jobs as the usage of robots increases in the hospitality industry. Boston Retail Partner’s Langdoc sees this as a challenge.

“The use of robotics must be seen by the guest as an augmentation of guest services, not as a replacement for the human labor element,” he says. “It is paramount that companies deploying robots properly promote and communicate the initiatives to avoid potential negative reaction from guests that perceive the robots are ‘taking away jobs.’”

Read full article: Automating Hospitality

Data Helps Restaurants Battle Profit Loss

Hospitality Technology – As consumer confidence in the economy rises, more people are heading out to eat. While good news, restaurant owners remain focused on retaining sales and preventing profit loss. Analytics and exception-based reporting tools are integral to building effective, scalable solutions for detecting fraud. For years, restaurants have used analytics to both prevent and detect fraud, but now there are new tools to find information and alert operators to issues. Every modern POS system and integrated security system comes with a range of controls and includes some type of smart reporting. Ed Heskett is the senior area coach for Border Foods (www.borderfoods.com), which has approximately 200 Taco Bell franchises. He notes that the analytics department at Border Foods looks at the fleet at large scale and generates reports with a focus on underperforming stores.

Border Foods uses a Delaget (www.delaget.com) reporting tool and a location dashboard daily, which gives the company a snapshot/summary and alerts it to potential problems. According to SpeedLine Solutions, Inc. (www.speedlinesolutions.com), POS systems send an alert that can come in the form of a message or report when suspicious activity occurs. Every notable event can be tracked.

Being able to collect, analyze, and react to information in a short time span empowers restaurants to take action and address potential problems before they mushroom.

“Collecting transactional information for analysis in real-time is imperative for a successful loss prevention-oriented, exception-based reporting or BI platform for restaurant brands or franchise operators,” says Scott Langdoc, senior vice president and practice lead at Boston Retail Partners (https://brpconsulting.com). As the time between a loss or fraud event and its detection increases, investigations become more challenging. On-duty managers must leverage well-developed fraud analysis thresholds to address outlier events — especially staff-related issues — as quickly as possible.

“For many, the movement to cloud-based POS has helped make data available more quickly for loss prevention (LP) intelligence. Companies with traditional, on-premise POS systems must rely on faster POS transaction syncing to centralized systems to enable near real-time aggregation and analysis of local POS data for trends and exception-based monitoring,” Langdoc says.

Read Full Article: Data Helps Restaurants Battle Profit Loss

5 Technology Trends to Know

QSR Magazine – In an age when technology is king—of every consumer and in every industry—it’s no surprise that four out of five customers believe technology improves their restaurant experience, according to research from restaurant software provider Toast. That’s just one of the reasons why today’s brands are putting innovative technologies to work in their stores, and often reaping the rewards from it.

But with the plethora of high-tech options out there, how do brands know what’s worth the investment? We polled several operators and industry experts to uncover which technologies are changing the game in five different areas of the restaurant—and which ones they’re itching to explore next.

Often entwined with today’s highly personalized apps and loyalty programs is another trend popular among restaurant marketers: gamification. Chipotle has long been a leader in the food-gaming space, but brands like Popeyes, Auntie Anne’s, Taco Bell, and Burger King have been pioneers as well.

“In gamification, there are very sophisticated linkages to marketing and promotions, to discounts, to loyalty programs,” says Scott Langdoc, vice president of consulting at Boston Retail Partners. “There’s a way in which the customer cannot just win the game, but actually get measurable benefits—be it by discount or promotion or some other award—as a result of spending time with the game on that app.”

With minimum wage and operational costs rising, a growing number of chains have turned to digital and automated ordering platforms—think tabletop devices, iPad ordering, digital kiosks, and various online ordering systems—to replace employee labor and increase sales volumes.

However, recent research from the National Restaurant Association shows that while many consumers appreciate high-tech options like online ordering, kiosks, and mobile payment, they aren’t looking for a total switch to automation in their limited-service experience. That’s why Boston Retail Partners’ Langdoc says many operators are providing consumers with choice above all else, combining ordering technologies like kiosks and tabletop devices with the age-old counter-service option. “Touch-point choice is more of the successful trend instead of just assuming that we’re going to see this holistic black-and-white migration to automated ordering,” he says.

To aid in the confusion that often comes with a plethora of ordering options, Langdoc says, a number of brands are opting for useful (though not-so-sexy) technologies like order-status screens. Restaurants are likely to manage the multiple points of ordering by installing digital displays that tell customers when their order is in process, complete, or ready for pick-up.

Read Full Article: 5 Technology Trends to Know

Restaurant Mobile Capabilities No Longer Optional

Hospitality Technology – The use of mobile devices, especially smartphones, has dramatically changed diners’ habits before, during, and after the meal. Mobile technology’s ubiquity has expanded the number of new opportunities for restaurant operators to effectively influence their engagement with, and behavior of, their customers.

At MURTEC 2017, BRP recently led an interactive workshop on “Mobile-focused Omni-channel Strategies to Transform the Customer Experience.” Utilizing real-time polling to interact with and receive feedback from the attendees, this collaborative session gauged the “state of the state” of mobile usage and maturity among the audience members to understand customer engagement at all stages of the guest journey. BRP defines the restaurant journey as having eight contiguous stages: 1. Select, 2. Plan, 3. Arrive, 4. Order, 5. Entertain, 6. Pay, 7. Feedback and 8. Reward.

The evolution of dining consumer activity has shifted from a linear and singular flow to a more closed-loop and iterative process. No longer are visits to a restaurant brand or specific location made in a vacuum. Rather, each step of the dining experience is now part of an integrated “journey” — one that is increasingly influenced by mobile-oriented engagement.

The impact of mobile devices on the restaurant guest experience cannot be ignored, and restaurant operators must now think mobile first. Mobile devices, having exceeded desktop internet usage a few years ago, are now increasingly driving aggregate Internet usage in the United States. Restaurant operators agree that mobile technology, properly applied at each of the eight stages of the restaurant guest journey, can have a material and profitable effect on restaurant operations. The other key takeaway is that offering guests and servers mobile capabilities is now an imperative and is not optional.

According to a 2016 Deloitte study on next-generation restaurant customer experiences, mobile ordering inside a restaurant is less prevalent (44%) than online or mobile ordering done before visiting a restaurant (70%). In our poll, attendees noted slow adoption of consumer or server-based mobile ordering regardless of restaurant type, with more than half still not implementing mobile ordering solutions. When asked to name the best approach to providing ordering capability, the majority of operators said that dedicated mobile apps were better choices than mobile-optimized ordering websites. Attendees were quick to add that customers were interested in mobile app functions beyond just ordering — they want the ability to add items to an existing order (in the case of table service) and be able to pay an open check. This aligns with data from HT’s 2016 Customer Engagement Technology Study that reveals that 74% of diners will choose a restaurant based on whether it has a feature-rich, useful mobile app.

The session attendees unanimously voted that understanding mobile-oriented engagement is a critical component of their go-forward restaurant operations strategy and requires careful planning across all business and operational workflows. Servers and customers need proper training on new mobile processes to avoid the well-publicized operational issues experienced by early adopters (e.g. Starbucks).

One of the most interesting takeaways from the session was how many of the workshop attendees were already offering online ordering — 70% of attendees indicated that they offer either online ordering or both online ordering and online reservations. Some participants noted that they do not see this capability as optional, but as a required function to “stay in the game.” One restaurant operator indicated that they have experienced a 25% increase in transaction sizes created through online ordering, which aligns with BRP data.

There were some minor differences in what specific areas of mobile technology operators felt were most critical — mostly due to segment differences (e.g. QSR vs. fast casual vs. table service). All agreed that a mobile technology focus on the broader restaurant journey is imperative, realizing how intertwined the steps of the journey are in creating a satisfied customer experience.

Read Full Article: Restaurant Mobile Capabilities No Longer Optional (see page 22)