Mobile ordering, QSR

Consumer driven order and pay: Why quick service restaurants need to adopt to compete

Published on November 19th, 2020

Mobile order and pay is fast becoming an established order method of choice within the quick service restaurants (QSR) industry globally, as brands navigate the challenges of trading midst a pandemic. But it's not only the consumer that benefits, there are widespread benefits for both the brand and the customer.

“There's something a little bit magical about sitting down, placing your order at your leisure and having someone show up with your food, perfectly cooked, perfectly hot.”- Raphaël Mazoyer, VP of Digital Marketing, McDonald’s Japan

This year, 74% of Americans used their phone to order and pay for food and merchandise at least once a week according to a recent survey. To put this into perspective, only four years ago this number was around 10% and in mid-2019, well before COVID raised its head, projections were that more than one out of ten QSR orders would be via a mobile ordering platform. At that time, those were some (rightly so) staggering stats.

Mobile order sales were expected to hit $31 billion this year. But COVID has accelerated the adoption of mobile order and pay technology to the point where penetration is now at levels that were not expected to be reached until 2023.

But if we take a step back, mobile ordering has been on the rise for some time, even before COVID accelerated the need for contactless customer experiences. A QSR Magazine article in 2017 discussed the many benefits for QSRs, such as an 18% increase in customer spend from online/mobile orders vs. phone orders, and more streamlined kitchen processes and overall restaurant efficiency.

According to a Business Insider report, 62% of US adults ordered food via digital channels at least monthly, but since COVID, 78% said they maintained or even increased their order frequency. Furthermore, mobile food orders for consumption at home or off premise (even at full-service restaurants) in July this year were up 69% from May.

Consumers love the convenience and safety of mobile ordering

There are two key aspects that make mobile ordering particularly attractive to consumers: convenience and safety. Convenience has always been the number one benefit – being able to browse a menu and place an order in your own time, at your own pace and in your own space is an immensely attractive customer experience. This is even more pertinent during COVID times where social distancing and minimizing close contacts with other people is paramount, which is where the second key benefit of safety comes into play.

“Convenience has been a huge thing for years. This has fast-forwarded the whole idea.”- Steve Schulze, CEO of Nekter Juice Bar

The mobile ordering experience has been enhanced with the explosion of delivery and pickup options now available, providing consumers with greater choices to suit their needs. As these new behaviors become normal and consumers realize the vast benefits of mobile ordering, it’s no surprise that 40% of consumers surveyed said they intend to continue the practice.

QSRs love bolstered sales and more loyal customers

It’s not just consumers who have a lot to gain from mobile ordering platforms. QSRs that have adopted the technology are reaping the obvious and also additional unexpected benefits. With COVID driving consumers to digital channels, QSRs are experiencing accelerated app download volumes and sign ups for loyalty programs. And indeed, mobile ordering is driving more sales with brands like Starbucks reporting 22% of total transactions happening via its mobile app.

Many people ordering via mobile apps are first time users, who would normally be classified as late adopters of technology and typically take years to get on board. This has brought new opportunity to build relationships with consumers that have previously been unknown to QSRs, purely by virtue of the fact that signing up for the mobile app provides the brand with the consumer’s data and therefore the ability to build a customer profile and deliver marketing at a personalized level.

How mobile ordering drove record results for McDonald’s Japan amid COVID-19

After launching its Plexure-developed mobile ordering platform in January this year, the McDonald’s Japan app quickly hit the number one spot in the App store with customers all over the country embracing contactless commerce in the era of social distancing.

Speaking to Plexure earlier this year, McDonald’s VP of Digital Marketing Raphaël Mazoyer talked about the impact mobile ordering has had on the business.

On the customer experience mobile ordering has enabled for McDonald’s Japan customers:

“We’re going where the consumers are, and just allowing them to interact with the McDonald’s brand, in the way that’s relevant to them… when you're standing in line at the front counter it's noisy, you've got people behind you, you get this pressure of ‘I got to get this order in real quick’. Well, with the app, you take your time, you do what you want to hesitate between this burger and that burger. And do I want fries, or do I want nuggets? Nobody is there to put pressure on you. The other thing that we saw people were particularly happy with is that at rush hour, it's a way for them to avoid particularly intense moments where the lobby is crowded. There's really a lot of people you actually have to wait. Well, with mobile order and pay you actually bypass this all together, and it becomes a much more smooth and pleasant experience.”

“What you really want to do is to enable people to perform the actions that they were going to perform anyway, but in a more convenient, more personalized way. From this point of view, the sense of unlocking this functional capability is something that will be valid in every country in the world.”

On the benefits of having a mobile ordering platform:

“We've got data coming in about how people are placing the orders, what type of orders they're placing, and what time of the day. And we're certainly going to go on developing the product, the user experience, to support those patterns that we're seeing in people.”

“…also from a brand perspective, having a transaction that's part of your digital activities, really changes the ability that you have to adjust and optimize performance.”

And, on the results:

"What we have seen is several percentage points of our monthly active users in the app, converting into mobile ordering. And that's a very, very meaningful metric for me, because essentially what this metric is about is, is this mobile ordering experience relevant to my audience? Have I been clear enough to them? But eventually they do judge. And that's really the metric on which we live or die.”

“The second element is average check. Generally, digitally driven transactions are bigger than the system average. So we've already got people coming in using additional discount. And those usually drive a bigger average check. We've seen this amplified with mobile ordering.”

What will happen if QSRs don’t adopt mobile ordering technology?

The arguments for mobile ordering technology are hard to refute. Consumers love the convenience, safety and seamless experience of being able to order food from anywhere, and QSRs are seeing significant benefits, not just in uplifts in sales but in data capture and the ability to establish more meaningful connections with consumers.

Mobile ordering is a must have for QSRs. With studies reporting statistics like 88% of consumers are using mobile apps the same amount or more to order food, groceries and other products, and 66% saying they have chosen a restaurant specifically because it offers a mobile order option, this behavior is here to stay. QSRs not currently exploring how to adopt the technology to enhance their customer experiences will soon find themselves in the unenviable position of losing market share to those that have.

If you’re interested in hearing more about Plexure’s mobile ordering solutions, book a demo with our sales team today.