Mobile Order Ahead

How QSRs Are Fighting Digital Food Fraud

A growing number of quick-service restaurants (QSRs) are relying on third-party delivery services such as DoorDash, Grubhub and Postmates to quickly and conveniently deliver food to customers’ doorsteps.

These services have helped many restaurants stay in business during the pandemic, but the surge in demand for food deliveries has resulted in a corresponding uptick in fraud. PYMNTS research revealed that 62 percent of QSR guests were wary of fraud when engaging with a restaurant’s mobile app, for example.

Despite these concerns, many consumers still seek the convenience of placing orders and paying via third-party delivery apps on their smartphones or tablets. QSRs therefore must confront the challenge of providing seamless mobile ordering and payment experiences while looking to cutting-edge solutions to keep their customers safe.

In the August Mobile Order-Ahead Tracker®, PYMNTS examines how fraudsters are capitalizing on consumers’ growing use of third-party delivery apps as well as how QSRs are working to protect their customers with innovative solutions.

Mobile Order-Ahead Developments Around The World 

Some municipalities in California are working to support the restaurant industry after the state recently implemented operational restrictions designed to slow the spread of COVID-19. California began reeling back its reopening efforts in July as its number of viral infections began to climb, forcing many eateries to return to offering only curbside pickup or delivery service. The city of Fremont recently issued an emergency executive order that intends to help restaurants relying on third-party delivery providers, however, setting a temporary 15 percent limit on fees that such services can charge restaurants.

Consolidation is underway in the competitive app-based food delivery space, according to one recent mid-pandemic performance report. India’s largest online food ordering and delivery platforms, Swiggy and Zomato, have become the two dominant contenders in the space since the latter acquired Uber Eats in India earlier this year, a stock deal reportedly worth $300 million.

Pickup orders are also continuing to experience growth during the pandemic, with recent data showing that takeout sales were up 66.8 percent in April and 96.4 percent in May. Online ordering and delivery platform Uber Eats has experienced an uptick in such orders, for example, prompting it to unveil a map feature on its app that enables users to determine which local eateries are open and taking pickup orders.

For more on these stories and other mobile order-ahead headlines, read the Tracker’s News and Trends.

Portillo’s On Providing A Safe And Convenient Customer Experience

Restaurants are seeing record increases in orders placed via third-party and in-house apps, leading many to seek ways to relieve the pressures faced by their kitchen staffs. Some QSRs are turning to ghost kitchens and self-delivery concepts to ease the strain while boosting brand awareness and employing local drivers.

In this month’s Feature Story, Eric Bevins, director of operations services at Chicago-based fast casual chain Portillo’s, talks about how the chain is keeping the customer journey smooth with its latest innovations.

Convenient Third-Party Food Delivery Apps Bring Spike In Fraud

Third-party delivery apps are making it easier for customers to order food from their favorite restaurants, but a surge in the use of these apps is also boosting instances of fraud. A recent survey of 1,000 QSR customers found that more than half were worried that dealing with QSRs could result in fraud, while 49 percent were concerned about credit card theft, and 41 percent were wary of account takeovers.

To learn more about how fraudsters are using apps to steal consumers’ personal information — and how restaurants and third-party delivery services are using cutting-edge solutions to fight back — read the Tracker’s Deep Dive.

About The Tracker®

The monthly Mobile Order-Ahead Tracker®, a PYMNTS and Kount collaboration, covers the space’s most recent news and trends and offers a provider directory highlighting key players across the mobile order-ahead ecosystem.

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NEW PYMNTS STUDY: LEVERAGING THE DIGITAL BANKING SHIFT – SEPTEMBER 2020  

The September 2020 Leveraging The Digital Banking Shift Study, PYMNTS examines consumers’ growing use of online and mobile tools to open and manage accounts as well as the factors that are paramount in building and maintaining trust in the current economic environment. The report is based on a survey of nearly 2,200 account-holding U.S. consumers.

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