This article first appeared on QSR Media.
There are years where it feels like only weeks of change takes place, and then there are weeks when it feels like years of change take place. The latter seems to aptly sum up the state of play in the hospitality industry as whole right now.
No doubt many of us are mourning huge losses and will do for some time to come, but the green shoots of a new future I have seen so far have been encouraging. Human instinct is millenia old, especially our instinct to provide hospitality to others, and the creative ways businesses have adapted to do just that during coronavirus-plagued times is worth celebrating.
Digital transformation drives new ways to provide hospitality
Specifically, the way in which ecommerce and digital operations have been embraced or sharpened has been fascinating. The sense I get is that merchants will not be thwarted when it comes to providing hospitality and staying connected to patrons wherever they are.
Take a typical mid-market QSR player right now, say with 10 to 20 venues across each major city. It’s highly likely that they now have a suite of ordering and delivery apps they’re using to reach customers beyond the one or two major global players we’ve grown accustomed to over the past couple of years. They’re also probably investing in their own ordering and ecommerce solutions, especially if they’ve got a strong brand, to sell anything from their usual menu to meal-kits and merchandise.
And as for customer loyalty programs, these have no doubt become more sophisticated as a result, alongside these new ways to transact overall.
Now for most QSR players this isn’t really new, but it is still do or die, especially if they want to come out of 2020’s constrained economy with a chance of kicking on in 2021. In particular, for large players this is a journey they’ve been on for some time yet still have a lot of work to do to overcome the legacy systems already in place. At least medium and smaller players can be more agile and make the tech changes required to thrive quicker.
Essentially, embracing digital and new tech is about opening up new revenue streams, which also leads to more data and insight on customers wherever they’re transacting with your business, leading to more opportunities to adapt and grow.
The whole is greater than the sum of its parts
Whilst this digital transformation has been accelerated due to COVID-19, it was always coming. And it’s clear right now that the winning food and beverage businesses are the ones who are (or have been) investing wisely in digital operations, marketing and tech & apps because it results in more choices for consumers, and diversified incomes for the venue.
Clearly, in a post-COVID world people will still want food on a plate in a bustling restaurant, surrounded by friends. Some things will never change. But other things might, especially if it grants more choice to consumers. Being able to offer that choice in a sustainable way is critical – it takes more than just piecing together some apps, venues need everything integrated so the tech whole can become greater than the sum of its parts.
For example, whilst a presence across more ordering apps means more opportunity, it also means more work for the restaurant. Don’t get me wrong, there’s a lot of digital opportunities out there for everyone, even if you haven’t started the journey yet, but if you don’t master the tech it can get out of control. I’m sure any restaurant team that’s spent a heap of time re-keying digital orders from multiple apps into a POS or updating menu items across multiple apps will testify to that, and that’s not even mentioning their own digital ordering and ecommerce.
We’ve all read reports recently across the industry of big increases in digital commerce for cafes and restaurants. Some suburban cafes I’ve spoken to are reporting that up to 80% of their business is now coming in via apps! Whilst this increase paints an exciting future, there’s no doubt plenty of operators out there won’t have the tech stack required to increase their digital revenue without impacting their operational costs though.
For example, just removing the manual re-keying of orders from apps to POS with a tech solution can reportedly save a busy restaurant upwards of $20,000 a year in labour.
If there’s one thing we’ve all been taught during coronavirus, it’s that having all your eggs in one basket isn’t a good idea, so new digitally enabled revenue streams are here to stay and likely to grow. But for this creative and digitally led coronavirus fight back to drive sustainable growth across the industry into the future, QSRs of all shapes and sizes need to make sure they have the right tools in place to simplify the technology ecosystem that surrounds them.
Once the tech is mastered, it’s back to the simple stuff, the human instinct, the bread and butter: providing awesome hospitality experiences to consumers, wherever they are.