The Growing Dilemma for Restaurant Owners
Rising consumer demand for off-premises dining
Consumers are choosing to eat wherever and whenever they want, and today it’s almost a necessity to offer it in the restaurant business. That trend is certain to continue to increase.
Grubhub, for example, now boasts 6.7 million active diners, has a network with over 40,000 partners in more than 1,000 cities and achieved a record $643 million in gross food sales during Q4 of 2015 and $2.4 billion for the entire year.
Convenience is becoming increasingly important
Digital ordering and delivery have been growing 300% faster than dine-in traffic.
Convenience is becoming increasingly important to customers, especially for Millennials, who are becoming a larger portion of the consumer population. This demographic wants to consume their favorite foods whenever and wherever they want, as well as order and pay for it with the click of a button.
45% of customers in a recent survey said that offering mobile ordering or loyalty programs would encourage them to use online ordering services more often.
There’s only one certainty
You can’t ignore this trend and hope to grow. Staying out of this off-premises market is a mistake.
Consumers are increasingly ordering their favorite foods to be delivered or to-go, rather than dining in-store. This presents a unique opportunity to take advantage of the delivery and takeout trends, rather than have your dine-in numbers and market share cannibalized by competitors who are focused on these services.
Implementations that worked
Starbucks’ easy-to-use mobile ordering and concomitant rewards program have been received well. 20% of all U.S.-based transactions are being made through the app.
Taco Bell’s mobile app and website ordering system enables customers to order, determine a pick-up time and pay in advance. The average order comes in at 20% higher than in-store orders.
What are your options?
Up until now you would only have two:
You could use a third-party company (Grubhub, Doordash, Ubereats, etc.). Simply sign up and quickly offer online ordering and delivery to convenience-minded customers. It’s easy and doesn’t incur upfront fees, as long as you accept the high service charges per order, and the fact that you don’t own the customer’s data, and therefore, can’t build a direct relationship.
While it’s easy to see the appeal of this option, you’ll lose more and more control while making less and less as your customers move their orders to a “middle-man”.
Or, do it yourself and follow the path of Starbucks and Taco Bell: Build an online and mobile ordering system to give carryout customers the convenience, and evaluate your own delivery options (including using driver-only logistics from the above companies). The only issue is the high costs and the expertise required to build such a system.
A Winning Strategy