Restaurants Take Advantage of Rise in Messaging to Drive Sales

As consumers increasingly message each other online, restaurants are taking advantage of their familiarity with these chat-based interfaces to reduce friction from the digital ordering and payment process.

By the Numbers

Research from the latest edition of PYMNTS’ ConnectedEconomy study, the “ConnectedEconomy Monthly Report: The Love and Social Media Edition,” which draws from a survey of a census-balanced panel of more than 2,700 U.S. consumers, reveals that digital messaging is on the rise. Specifically, the share of consumers messaging online rose in the last year from 42% to 47%.

The Data in Action

Noting this rise, restaurants are rolling out new chat-based ordering features.

For instance, Yum Brands, the parent company of Taco Bell, KFC, Pizza Hut and The Habit Burger Grill, on a call with analysts Wednesday (May 3) discussing the group’s first quarter 2023 financial results, that KFC is seeing its conversational commerce efforts drive retention. Its Tictuk program, enabling consumers to order their meal via chat, is proving relatively sticky.

Yum Brands CFO Chris Turner shared that the company’s “single largest market deployment” yet of its Tictuk chat-based ordering platform, acquired in 2021, shows that the feature has at least some staying power.

“Customers are now able to order KFC across 1,000 stores in South Africa using WhatsApp. Early results in the market show this new ordering channel is sticky, with more than 40% of users placing multiple orders in the first 90 days after launch,” Turner said.

Plus, Meta is aiming to get in on the rise of chat-based ordering. Last summer, the tech giant invested in Take App, a Singapore startup that offers conversational commerce solutions for restaurants and other businesses selling via Meta-owned messaging service WhatsApp.

The startup was founded by a former Meta employee, Youmin Kim, who previously worked as a partner engineering manager at Facebook, and it offers an order form for sellers accompanied by order management and analytics tools.