The QSR space is one that is constantly innovating to match a rapidly changing world and population. The implementation and roll-out of new technology have always been a constant in this industry, but sea changes in the way people think and work have hastened some of the inevitable shifts seen in the industry.
Prior to the pandemic, implementation was a slow process. Brands saw no reason to rush the roll-out of new technology. The situation is different now, and much of that technology is required. Order screens and digital payment options have become the standard to maximize social distancing, and minimize common touchpoints.
Marketing is facing increasing automation. Software providers like Scorpion have been providing A.I. software to franchisors for some time but are seeing a lot more uptake, a lot more quickly. In an ever-changing world with remote teams, employing an A.I. system to react, produce reports and compile data without human input is saving huge amounts of time and delivering fresh insights.
While it isn’t so difficult to roll out a loyalty program and harvest its data, it’s much harder to find an effective, affordable robotic system that can prepare or cook food consistently. Food preparation and cooking is the final frontier in the restaurant, but it may be some time till brands make the plunge.
In all of this, many workers will see their jobs replaced by code or computers. The maintenance of these systems, as well as strategy, may create fewer but more high-paying roles, creating a different kind of opportunity.
Marketing technology leads the way
Marketing technology appears to be the most sophisticated element of the digitization and automatization process in the QSR industry. As one of few non-tangible processes, it lends itself to the digitization process a lot more easily.
“The most profitable customer is a repeat customer, and we just invested in Agot A.I. to make sure customers get what they want when they want it and how they want it,” said Dan Rowe, CEO of Fransmart.
“Four walls marketing is all about a guest experience and getting customers to come back more often. We do any number of things to generate trials, and then Agot A.I. helps with frequency and guest check average.”
Marketing technology can take on manual tasks, freeing up time for strategy as well as crunch huge sets of data to find new insights. With the number of channels available to marketers, technology helps them to access every single channel and personalize the messaging for every platform and set of customers.
“They’re [loyalty programs] an excellent tool for both revenue and data. Our brands Rise and Curry Up Now have robust loyalty programs that combine data and tech to enable incremental revenue through digital upselling and customized deals and offers”
Entire franchise systems can be plugged into this and share learnings. A promotion that has worked exceedingly well in one location may work in others, and data can provide that insight. Machine learning algorithms will grow with the company too, making use of all the historical data available to make predictions, and identify pain points.
In 2022, brands will deepen their commitment to A.I. and integrate it as a key part of the current year’s marketing strategy and digitization programs.
Ordering and food prep
Brand locations in major cities around the world were piloting ordering screens over the last decade, and by 2020, they were a common feature in restaurants around the world. A.I has stepped into the world of ordering too, with Checkers & Rally’s new A.I. voice assistant.
“With about 80 per cent of total business at Checkers & Rally’s restaurants happening through the drive-thru, we’re always focused on ways we can improve the experience for guests and employees alike,” said Mary Melvin, director of restaurant technology at Checkers & Rally’s.
“We have been a leader in drive-thru for 30 years, so this effort was really aimed at bolstering our already well-operated systems. The use of automated voice bots now helps us streamline operations in the kitchen for speed of service, improve order accuracy for higher guest satisfaction, upsell total orders, and alleviate stress for team members.”
Once the pandemic had struck, many brands tried to speed up the implementation of their ordering screens. There were, however, many brands that could not commit to digital ordering screens across all of their locations. Many found a cheap and convenient solution in the form of QR codes. Customers could simply scan the code on their phones to bring up the menu and order straight from there, cutting out all touchpoints and close contact.
Some baked it into their concept from the beginning:
“Brooklyn Dumpling Shop uses app or kiosk ordering and automats and enjoys half the labor most fast-casual brands have on any shift,” said Rowe.
“Guests will be able to place an order on their phone or via one of the restaurant’s POS (point-of-sale) kiosks. When a guest’s order is ready, the customer will receive a text notification to get their special delivery from a marked, temperature-controlled locker, opening automatically once the customer scans their barcode.”
The Picnic Pizza Station is an automated pizza assembler. It began accepting orders from August 2021 onwards, and claims it can make 100 consistent pizzas an hour as well reduce food waste by two per cent. However, some pizzeria owners have cited the cost of the robot and the fact that it doesn’t solve a burning problem as a reason for reluctance. The technology costs $3,500 – $5,500 a month.
“A.I. technology at the drive-thru is just the start. We’re looking to expand the use of A.I. and autonomous systems in the back of the house to help operational efficiency,” said Melvin.
“Technologies like robotic process automation, smart kitchens and voice assistants will play into the longer-term strategy as we turn towards technology to help streamline experiences for our guests and employees.”
As long as robotics manufacturers are able to build more sophisticated robots for cheaper, the presence of robots in the kitchen is an inevitability. If done correctly, it should result in quicker cooking times and far fewer mistakes.
Loyalty programs and the gathering of data
Data is gold dust to all businesses, but especially consumer-facing ones. For a brand to have an understanding of what its customers are thinking is invaluable. Loyalty programs are an excellent way to find that out, while giving the customer some value for their data.
“A.I. technology at the drive thru is just the start. We’re looking to expand the use of A.I. and autonomous systems in the back of the house to help operational efficiency”
“They’re an excellent tool for both revenue and data. Our brands Rise and Curry Up Now have robust loyalty programs that combine data and tech to enable incremental revenue through digital upselling and customized deals and offers,” said Rowe.
“The data helps refine the offerings to each individual based on their tastes and buying habits. They’re equally as helpful, feeding off each: loyalty increases frequency, and guest check average and data helps us market precisely what each customer wants, leading to an overall increase in effectiveness.”
Loyalty programs have been around well before the advent of the smartphone. Punch cards were often used for loyalty programs, and while it did drive revenue, there wasn’t too much to be learned from them.
Now that the loyalty programs are on people’s phones and every click and press is recorded, a brand can build up an image of its customers’ wants, likes and dislikes. This can inform promotional or marketing programs to more deeply connect with customers and consequently, increase revenue.
Any brand that is not making use of its sales, marketing and any app-based data is missing out on insights and learnings. All data tells a story of what customers want and are most likely to interact with.
The Patronix and PYMNTS 2020 study on revamped restaurant loyalty programs shows what customers want. According to the study, 40 per cent of QSR customers do not use a loyalty program because their favorite restaurant does not offer one. 57 per cent of customers who use one loyalty program would spend more on orders from other restaurants if they too had their own loyalty programs. Over 25 per cent of McDonald’s sales are coming from digital channels, and it’s been largely driven by the brand’s loyalty program.
It’s a guarantee that in 2022, almost every major QSR brand without a loyalty program will either release or begin building one.
Tech improvements and upgrades are non-negotiable
Digitization and technology were already the overwhelming directions the industry was moving in before 2020, the advent of COVID-19 has hurried it along. What once were improvements in efficiency, have now become matters of safety too.
With an increased inflow of data, brands have access to many new insights and trends that can help them further improve their services and increase revenue. This will be greatly aided by the use of A.I. marketing technology and loyalty programs, which will directly interact with customers and learn from them.
The core operation in a QSR business takes place in the kitchen, and robotics manufacturers are making slow but steady steps to provide brands with effective and economical robots. Though this will more likely materialize in the near future for the greater public than in 2022 itself.