Retail

How QSRs Enable Digital Options With Rapid Order-Ahead Growth

mobile order food

In an era of restaurant technology that provides diners with many choices, mobile order-ahead is more popular than ever with consumers. Quick-service restaurant (QSR) consumers, for instance, are tapping into digital apps to make purchases over twice as often as they did just two years ago. At the same time, downloads of delivery apps have surged — more than doubling — over the same period.

According to the latest PYMNTS Mobile Order-Ahead Tracker, some estimates peg mobile ordering at 60 percent of all digital food and beverage purchases. And rapid growth is expected to boost the market’s value to $38 billion by 2020. To meet this rising demand, QSRs are tapping into ordering interfaces built into cars and reconstructing stores to make for smoother mobile pickup — along with other innovations.

From Chipotle Mexican Grill to Square, QSRs and payment firms alike are enabling a world of ordering innovation. These are just some of the ways that companies are allowing consumers to place their orders for pick-up before they arrive at a brick-and-mortar restaurant location or for delivery by a driver via a digital platform:

The mobile order-ahead market is expected to have a value of $38 billion by 2020. And payments firms are helping restaurants with mobile orders: Square, for instance, is releasing new order management integrations for Square for Restaurants. It will let orders from Postmates, DoorDash and management platform Chowly to join existing provider Caviar in flowing directly into a point of sale (POS) system of a restaurant. The company noted in a release, “Square for Restaurants now streamlines the entire process of accepting off-premises orders, like delivery or takeout requests, and enables restaurants to be even more efficient and productive.” The release also noted, “Additionally, restaurants will have a simplified look into their in-store, online, and delivery orders all in one unified location.”

The portion of small QSR managers satisfied with mobile order-ahead pickup offerings is 91.4 percent. In the case of Chipotle Mexican Grill, CEO Brian Niccol noted in a recent earnings call that the restaurant’s digital system — including order-ahead, catering, delivery, mobile order pickup shelves, digitized second make lines and Chipotle Rewards — “is creating a more convenient and enjoyable guest experience” while letting diners place orders through whichever method they choose. He also noted the company recently finished the addition of mobile order pickup shelves in relevant restaurants. They are a “key element in digitizing and modernizing our restaurant experience,” he said. At the same time, he noted that they increase speed of service, access, and convenience for the restaurant’s guests while also driving digital sales and building more love for the brand.

The number of mobile device attacks over the past year increased by 117 percent. In fact, more than half of the companies that were polled in IDology’s Sixth Annual Fraud Report experienced a mobile fraud increase. One fraud technique is inbound SMS communications are intercepted like messages for two-factor authentication with one-time passcodes (OTP). And, with SIM cloning, a victim’s SIM values are copied to let scammers impersonate a network subscriber and receive communications. In addition, SIM swapping uses social engineering along with personally identifiable information (PII) that is stolen to deactivate the SIM of one user and activate a fraudster’s own device.

There were 16 million active Grubhub users as of March. And QSRs are teaming up with the delivery platform: Dunkin’, in one case, has announced it is working with Grubhub on its Dunkin’ Delivers service rollout. Over 400 Dunkin’ restaurants throughout the five boroughs of New York City are now offering delivery through Seamless, Grubhub’s New York brand. At the same time, there are reportedly plans to bring the service to more markets in the months to come such as Chicago, Philadelphia and Boston. Through the service, New Yorkers can order Dunkin’ items via the Seamless or Grubhub mobile app or website. And Grubhub has even integrated into the POS systems of Dunkin’ to ensure fast, accurate deliveries.

Americans’ spending on meals away from home rose 50 percent from 2007 to 2017. As this shift occurs, restaurants are offering new selections. Panera Bread, for instance, has been experimenting with a menu for dinner at a Jacksonville, Florida restaurant in an effort that could present new delivery opportunities. And restaurant chain is reportedly bringing the test in July to nine Lexington, Kentucky locations. Dinner is said to be a popular time for delivery orders, and the chain taps into its own drivers in place of working with another firm. Panera’s Chief Growth and Strategy Officer Dan Wegiel said, according to a recent report, “We definitely saw for delivery an opportunity with dinner, but it flagged as something we could unlock further for sure.”

From Panera Bread to Square, restaurants and payment companies alike are helping consumers order ahead with the help of innovative offerings. And, going forward, emerging technologies such as artificial intelligence (AI) could shape the future of mobile ordering and restaurant technology in the world of order-ahead.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. The July 2019 Pay Advances: The Gig Economy’s New Normal, a PYMNTS and Mastercard collaboration, examines pay advances – full or partial payments received before an ad hoc job is completed – including how gig workers currently use them and their potential for future adoption.

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