Why Aren't There Restaurant Apps That Do What You Want?

Why are so many restaurants so low-tech? Part of the reason restaurateurs aren't interested in technology -- and particularly mobile apps -- is that they're more interested in food and the people eating it. But there's also more specific reasons, according to tech investor Bryan Menell in TechCrunch.

Case in point: payment apps. "You would be hard-pressed to find a restaurant owner or general manager who considers mobile payments necessary for their restaurants," Menell writes. "Everybody has a debit card, and it takes 0.0154 seconds to swipe. It has a user interface that everyone understands, and it's fast and simple. The only thing about credit cards that restaurants don't like is the fees."

Third-party apps also increase PCI compliance issues, which are expensive and complicated to address on a restaurant-by-restaurant basis.

What about just piggybacking on point-of-sale systems, since that's where a mobile app's data has to end up anyway? That requires cooperation from POS vendors who have no incentive to share their APIs with mobile-payments entrepreneurs, because the POS vendors won't make money from the app -- and when something goes wrong, it's not the third-party app vendor that the restaurant will call, it's the POS vendor.

Beyond payments, apps for restaurant functions such as ordering, loyalty programs, reservations and social and sharing are either already well staked-out (think Seamless/GrubHub for ordering and OpenTable for reservations) or aren't seen to add enough value to be worth the trouble. And that's leaving aside all the patents belonging to startups that have already tried to disrupt the hospitality business.

Who might succeed? One possibility: Already have "either a vast number of consumer eyeballs or tens of thousands of existing merchant relationships," Menell writes. "Outside of that, you need a dramatically unique approach that speaks to all these industry challenges."



The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

Click to comment