Restaurant Roundup: Subway Aims to Drive Digital Orders; Restaurants Reveal Off-Premise-Centric Formats

Restaurants: Subway Aims to Drive Digital Orders

Subway, one of the largest restaurant chains in the world by store count, is hardly a leader in the digital space.

On PYMNTS’ Provider Ranking of Mobile Order-Ahead Apps, for instance, which ranks restaurant apps based on the number of users, the average amount of time spent on the app, the ordering options and the loyalty and rewards integrations, the sandwich chain does not even make the top 10.

See the ranking: Provider Ranking of Mobile Order-Ahead Apps

Now, Subway is trying to boost its digital platforms with online exclusives.

The sandwich chain announced in a Wednesday (Feb. 2) press release the launch of a new menu, available only through its app and its website. The Super Bowl-themed menu aims to parlay the excitement of the event into digital adoption.

Digital efforts such as this one are necessary to win the spending of restaurants’ most frequent customers, revealed PYMNTS research from this month’s edition of the Digital Divide report, “Digital Divide: Technology As A Catalyst For Restaurant Purchases,” created in collaboration with Paytronix. The study, which was conducted in December and drew from census-balanced surveys of more than 2,400 U.S. consumers, found that technology enthusiasts are more than twice as likely as technology dodgers (those who use zero to one technologies) to order from restaurants three times a week or more.

Read more: QSRs Chase Tech-Savvy Diner Spend With New Digital Tools

Restaurants Reveal New Off-Premise-Centric Store Formats

In the ongoing push toward more off-premise-centric store formats that lower overhead costs for restaurants while taking advantage of the digital ordering boom, more restaurants continue to join the mix.

Dallas, Texas-based, 1,650+-restaurant brand Wingstop, for one, announced in a Thursday (Feb. 3) press release the opening of its first restaurant with its new, more flexible design. The format aims to allow experimentation with layouts and equipment, with the new store, located in the chain’s home city, being off-premise-only.

“A glimpse into [this] location is a glimpse into the future of Wingstop — focused on 100% digital transactions, seamless back of house operations, ongoing flavor innovation, and a business model centered around our fans, who love to dine off-premise,” Wingstop Chief Growth Officer Marisa Carona said in the release

Similarly, Arizona-based pizzeria and entertainment venue chain Peter Piper Pizza, which has more than 120 locations in the United States and Mexico, announced in a Wednesday press release its first off-premise-only format. The chain, owned by Chuck E. Cheese parent company CEC Entertainment, is set to open its first store of the kind in Phoenix at the start of March.

“Based on the success of these new units, we believe the concept will be attractive to our current and potential franchisees and will allow further brand penetration in existing and new markets at a substantially lower investment with a very attractive rate of returns,” said CEC Entertainment President and CEO David McKillips in the release.

Jimmy John’s Joins Restaurants Trying Out Drive-Thru-Only Locations

Digital channels are not the only off-premise options that have experienced a surge in recent years; drive-thru orders have also been elevated. Consequently, many restaurants have been looking to maximize their drive-thru sales while minimizing spending on less profitable channels by trying out drive-thru-only stores.

The latest to join the mix is Jimmy John’s, the Inspire Brands-owned, Illinois-based sandwich chain, which announced in a Wednesday blog post that has opened its first such location in Bartow, Florida.

“This new drive-thru only model represents our continued commitment to evolve with our guests and serve the best, freshest sandwiches with speed and efficiency,” said Inspire Brands Vice President of Design and Architecture Andrew Bello in the post.

Research from PYMNTS’ 2021 Restaurant Readiness Index, created in collaboration with Paytronix, found that 40% of consumers believe that the ability to pick up orders at the drive-thru will be important to restaurants’ future success.

Read more: QSRs’ Lagging Loyalty-Reward Investment Hurts Innovation and Sales

Lunchbox Brings in $50M in Series B Funding Round

Restaurant ordering and marketing solutions provider Lunchbox announced in a Tuesday (Feb. 1) press release a $50 million Series B fundraise led by investment management company Coatue with participation from DoorDash and Sweetgreen, among others. The former’s investment is especially noteworthy given that much of Lunchbox’s messaging has centered on the company’s commission-free marketplace, with the ordering platform positioning itself in opposition to leading aggregators, such as DoorDash.

“We’ve built a transformative food tech company by creating products designed by restaurateurs for restauranteurs,” Lunchbox CEO and Co-Founder Nabeel Alamgir said in the release. “The pandemic forced restaurants to understand and quickly adapt to new technologies in order to stay afloat and we’re here to help.”

The news comes just a week after Lunchbox announced its partnership with virtual restaurant company Virturant to create a new marketplace app, Ghost Eats, which will allow consumers to order from multiple virtual brands at a time.

See more: Lunchbox Launches Ghost Kitchen Marketplace

In October 2020, the New York-based company announced a $20 million Series A fundraise, also led by Coatue.

Read more: Online Ordering Startup Lunchbox Notches $20M