Fast food and quick-service restaurants (QSRs) are much more about mass production than customization, no matter how many personalized options those operations offer hungry consumers. However, change is afoot, according to Tim Ridgely, head of order and delivery for Paytronix Systems, in a new PYMNTS interview. That could mean the QSR world will form relationship-like ties with consumers.
The Paytronix platform, used by more than 400 restaurants and other types of merchants to personally engage with customers, collaborated with PYMNTS on a recent deep dive into restaurant innovation and trends.
Ridgely spoke with PYMNTS as the latest figures from the National Restaurant Association paint a promising picture for the U.S. restaurant market. Overall, restaurant sales are on track to reach $863 billion by the end of the year. Many restaurants are realizing that they need to provide their customers with delivery options to tap into the market’s full revenue potential, and are partnering with third-party delivery services to give customers the option to order their favorite meals, while raking in extra revenue.
That’s not all that’s happening when it comes to food delivery, though. A shakeout seems to be in the future, according to experts.
“Yes, I think that’s almost certain to happen,” Ridgely said. “It kind of happens to all industries.”
Yet, what’s not as certain is how well each QSR operation will manage its relationships with third-party delivery platforms — or how much control and insight those restaurants will have when it comes to consumer data.
“Third-party providers are looking to control the guest data to a certain extent,” he said. Restaurant owners [will also] feel pressure to find ways to unify their digital ties to the various delivery partners they work with — pressure to use a [single] unified platform.
Loyalty programs will also keep increasing in importance in the coming months, and into 2020. Indeed, the PYMNTS research shows that rewards programs continue to be one of the restaurant industry’s favorite tools to retain customers, with several companies rolling out their first rewards offerings.
Boston Market, for instance, is among the restaurant brands making their first forays into loyalty rewards. The chain recently debuted its Rotisserie Rewards loyalty program via its mobile app. The program offers online and mobile customers one loyalty point for every dollar spent at the restaurant. Points can be collected and redeemed for free food items or holiday meals for multiple guests.
Delivery service provider Grubhub, meanwhile, launched its own loyalty system. The program, known as Perks, offers customers redeemable points that can be used via the mobile app, and redeemed at brands like Taco Bell and Red Lobster.
“As more brands embrace loyalty, the technology continues to accelerate the brand’s ability to connect with its customers,” according to Ridgely. “Advances in artificial intelligence [AI] and machine learning are already showing high-impact returns within our customer base. Predictive behavior, personalized offer generation and customized timing to the individual have proven to be a multiplier on campaign results.”
AI, after all, will enable QSR operators to gain what he called a more granular view of customers and their behavior, including information about their visits, as well as food and beverage preferences. That will lead to the crafting of better loyalty offers or incentives, tailored to the individual customer. The main problem?
“Investing in AI technology that really makes a difference to the brand,” Ridgely said.
The trend is still in its early days, as is the general case with AI deployments in most areas of the digital economy, but evidence of the trend’s strength came earlier this year from McDonald’s.
Domino’s, meanwhile, has offered members of its Points for Pies rewards program a chance to earn points without having to buy a pizza from the chain. To receive the promotion, diners must download the QSR’s app, and sign up for its rewards program. They can then use a “newly embedded pizza identification feature to scan their pizza,” and earn 10 points from the company.
The overall goal?
“Treat every person like an individual,” he said.
That, indeed, could change fast food and QSR operations well into the future.