How can QSRs benefit your business?
Waiting in line for what was meant to be fast food can take the edge off a tasty meal. But quick service restaurants (QSRs) are complicated operations: real-time manufacturers serving hundreds, if not thousands, of hungry customers every day. And the QSR sector just seems to be growing in popularity as more consumers demand food on the go. About 80 percent of Americans eat out at QSRs at least once per month, half the population eats there at least twice a week, and roughly seven percent do so every day. If that wasn’t enough, the coveted Millennials eat out at an average of three or four times per week and spend almost half of their food budget at QSRs.
Clearly, this is a retail segment unlike any other, and it’s highly competitive because of it. QSRs know that their customer base has plenty of alternatives if service doesn’t meet expectations. Local small operations, food trucks, and specialty food chains are constantly popping up to cater for more diverse tastes. Pre-prepared grocery selections and disruptors like Amazon Go will only add to the mix.
To combat these disruptions, QSRs are turning to technology to create the same frictionless experiences customers are demanding of other retail outlets.
The End of the Line
With the bigger QSR chains leading the way, many establishments are now offering the ability for customers to order their meal ahead of time through a smartphone app. Just select from the menu and indicate the pickup time. No need to wait in line, and the payment happens instantly in the background, all controlled by the app with no need for cash or cards. Consumers can beat the lunchtime rush and simply waltz in, pick up their meal and go about their business without the lengthy wait. No fuss, no mess, no hassle.
Embedding the payment mechanism is a vital component to making this work. After downloading a QSR’s app, customers register their preferred payment mechanism and never need to look for their wallets or a card again.
But this is not limited to single QSR chains. Many of the popular takeout aggregators are adopting order- and pay-ahead capability, including delivery costs if needed, into their apps. Consumers have never had it easier – soon, they may not even need to leave their cars. Many vehicle manufacturers are including order- and pay-ahead technology into their onboard computers. Drivers will simply ask their navigation systems for a restaurant and the car will take the order, pay for it and then direct them to the pickup point, where their meals will be waiting.
The geolocation capabilities also permit both smartphones and smart cars to suggest a meal break at a favorite QSR whenever a customer is in the area, maybe even suggesting special offers based on personal preferences and behavior.
We read endlessly about the need for instant gratification in today’s world, but ordering and paying ahead for QSRs does much more than this: it is a direct revenue generator and cost saver. The ability to order ahead increases the average ticket by around 10 percent compared to those who wait in line to and pay in person. This is good news for the QSR and the financial institution that has its payment mechanism embedded as a customer’s preferred payment mechanism.
Additionally, considerable labor cost savings are made when a customer pays with a mobile app. It is estimated that around 30 percent can be trimmed from labor costs when a comprehensive order- and pay- ahead service is offered.
In order to promote usage, some of these savings can be returned to regular app users in the form of direct savings or additional customer loyalty points, thus making order ahead a vital marketing tool to bring in additional custom. The ability to market QSR products directly can become very advantageous. Many consumers order the same menu, within the same 30-minute window, from the same QSR, more than once per week. A push notification just before a customer normally orders could drive them to choose a particular QSR even more often.
Getting Close and Personal
For financial institutions, ensuring their card is the one embedded into the app becomes paramount. After all, the card that is top-of-wallet tends to stay there whenever the customer shops. Banks should consider partnering with QSRs in order to preemptively get their payment mechanism registered as default. Combining loyalty program promotions and savings on regular usage can be valuable weapons in growing the percentage of spend on a given card. Prepaid cards can also be embedded into digital payment mechanisms to attract underbanked consumers and millennials who often select alternative payment mechanisms rather than traditional bank card schemes.
For QSRs that want higher consumer spend per order as well as a reduction in costs, order-ahead mechanisms combat the competition and drive very strong customer loyalty. For banks too, pay-ahead enables them to be embedded with a consumer and gives them valuable insight into spending patterns and behavior.
Ordering ahead gives all stakeholders a stronger footing, with the consumer being the clear winner with increased speed and convenience and lower potential costs.