Across every part of the retail and hospitality economy, using technology to improve the customer experience has become a massive area of focus for brands. Failure to move with the times puts hard won customer loyalty at risk in favour of brands that can anticipate their needs and preferences.
Indeed, evidence suggests that consumers now view tech-enabled capabilities, such as personalisation as key parts of their decision-making process and purchasing experience. Hubert da Costa, VP & SVP EMEA at Cybera explains more.
The impact of technology-driven innovation is difficult to overstate, and for some businesses the challenges appear to be of existential importance. Recent analysis of Thomas Cook, for example attributed its demise, at least in part, to the increasing demand for personalisation and the unrelenting pressure to use technology to differentiate.
As a market segment, QSR is becoming increasingly reliant on innovative technology. In fact, outlets and restaurants are facing more pressure than ever to update technology systems to support a personalised and customised service. They are also challenged by a combination of higher wage costs and labour shortfalls, and the resultant pressure brings a growing sense of urgency that the sector needs to raise its game.
In reality, most QSRs operate against a difficult backdrop of cobbled together technology platforms ‘at the edges’ of their organisations, including point of sale, ecommerce, order management, supply chain and workforce management. It’s not uncommon for these systems to be only loosely integrated with core infrastructure (such as business process templates, ERP, financials payroll and data warehousing), which can seriously limit the ability of business owners to successfully adapt their approach to meet tech-led trends.
Key tech trends – adapt or die?
To improve the customer experience and increase brand loyalty, QSR business owners must understand the trends that are impacting the industry. Looking at brand leaders such as Starbucks shows how industry leaders are thinking, with recent reporting from Forbes examining the new, mobile-only Starbucks ‘Pickup’ store concept. Exclusive to users of the Starbucks app, the store illustrates the importance they place on tech services and adds to the Starbucks “portfolio of store concepts, ranging from full-sized stores which can be used by customers to do work, hold meetings and for relaxation, to drive-thru only stores meant for areas with a volume of commuter business.”
There are many similarities between the infrastructure of hospitality and retail businesses. Amazon has been pursuing similar tech-led strategies in their physical outlets for some time, and now has 16 fully automated Amazon Go stores up and running in the US. In terms of footprint, that’s still a drop in the ocean, but as CNBC recently revealed, the company’s ‘cashierless technology’ may soon be appearing in other locations, such as airports and movie theatres.
The macro tech trends being driven by the deep pockets of Amazon and Starbucks (among others) are certainly heading grabbing, and in the medium to long term, QSRs would be unwise to ignore them. In the here and now, however, there are a range of tech opportunities that should be addressed as priorities:
Mobile payment boom – QSRs need to begin focusing on some key areas, starting with a recognition that smart phones play a central role in making our everyday lives more convenient. For instance, apps for ordering or delivery of food, regardless of where or when it needs to arrive are no longer an emerging trend or fad – they are a must have. In a recent survey by Market Force Information, nearly 40 percent of consumers said they had placed a food order using a smartphone within the past 90 days.
This demand for increased mobile device usage has seen QSRs turn to software-defined networks, which are built for speed, security, and compliance to support online orders for delivery or pick-up, as well as traditional instore payments or mobile-based payment systems and apps.
Driving digital customer loyalty and engagement – Providing a compelling customer experience can really set one brand apart from another. Customers also know that their purchasing power matters too, and they want to be rewarded for loyalty to a brand. The good news is that QSRs now have a multitude of channels to engage with their customers – whether through email, via mobile apps and notifications, or through instore digital signage and beyond – a multi-faceted approach helps reach the customer and entice their return.
Cloud adoption and agility – The cloud had become essential for fast scale-out of core back-office solutions and new customer engagement apps among highly distributed QSR businesses. But, if QSR technology infrastructure is built upon a legacy WAN, its complexity and expense could impact the profitability of the business. However, utilising cloud-based networks that adapt quickly to changing business needs can save significant time and IT resources. Through cloud technology, QSRs can also keep up with the rapid software updates that run the business, making it essential to their success. It can also create opportunities to maximise margins, positioning the store for stronger outcomes.
To capitalise, QSRs can work with a technology partner with deep knowledge of the latest products and services and experience providing valuable insights on how to integrate into existing infrastructure. Hospitality businesses that use digital technology to differentiate themselves will have new opportunities to drive growth in this era of rapid change.