Oscar Nieboer, Chief Marketing Officer, Paysafe Group
On and offline, technology is shaping the way in which hungry consumers make food purchases.Whether it's ordering a takeaway on the way home from work, or paying a bill in a busy restaurant quickly without having to track down a waiter, innovative tech companies are providing consumers with an array of payment options that make the food ordering process a much more pleasant experience.
According to our data, over a tenth of British consumers (11%) order their lunch using a website or app. The increase in smartphone adoption in recent years has meant restaurants have had to evolve rapidly to meet the demands of super-connected consumers.From independents to multinational chains, a vast number of food businesses have taken note of the evolving customer trends, and capitalised on the benefits that alternative payment methods, including in-app purchases, can bring. In fact, it is predicted that mobile order-ahead will be a $38 billion industry by 2020, accounting for 10.7% of total quick-service restaurant (QSR) industry sales.
From front-of-house to front-end apps
Restaurants are progressively becoming e-commerce businesses. For some time, we have seen Starbucks, Five Guys and other food chain restaurants accepting orders through their branded apps and websites. But for small and mid-sized businesses (SMBs), investing in digital ordering technology can be a costly and challenging exercise.
For SMBs wanting to get on the action, introducing mobile order-ahead capabilities with the right level of preparation and resources can go a long way. This is where GOLO, an online and mobile ordering platform designed to connect smaller merchants with local consumers, comes into play. Recently launched by FANS Entertainment, a Paysafe Group company, GOLO is a free app that allows merchants to access the online marketplace at low cost (by charging a small transaction fee per order), thus helping smaller businesses level the playing field as they compete with larger counterparts.
However, to successfully attract and retain customers, businesses need to think beyond incorporating apps that deliver a pleasant and intuitive user experience. A key part of the customer experience is the payment process, and while it is often the last step in the transaction, it's arguably the most important. In fact, 20% of UK consumers have cited a lack of payment options as the reason for abandoning their online shopping basket. This means that offering a range of payment methods at the checkout stage that are secure and suit the customer needs, for instance, payment methods like cryptocurrencies which are gaining momentum fast in the UK – 12% of consumers are using them – are key for businesses to thrive in a competitive environment.
Some brands have taken inspiration from e-commerce giant Amazon and have introduced one-click ordering – all users need to do is order once, and all of their meal preferences and payment details are saved for next time. Domino's Pizza even took this idea one step further with its 'zero click' ordering: users simply need to open the app and if the order isn't cancelled within ten seconds, pizza will be on its way. Gartner has predicted that by 2021, brands will be redesigning their offerings to support visual and voice search to meet customer demand, and the pizza chain is taking advantage of this growing trend and its early adopters by launching voice ordering with Amazon Echo.
More recently, Subway has introduced a way for customers to order and pay via a chatbot in Facebook Messenger. Although still in its infancy, it already supports group chat, making it easy to split the bill between friends.Future updates are expected to include a functionality that allows orders to be placed with a single emoji.
On the other side of the coin, app fatigue can be a huge barrier to reap revenue. Offering users an incentive to download the app to begin with, and then utilising the app to send push notifications with promotions is a simple, yet effective way to combat this. Starbucks has a loyalty programme that lets its customers order and pay straight from its app to cut queuing time, as well as rewarding them with freebies once a set number of purchases have been made.
In addition to loyalty programmes, apps can present an opportunity to upsell and cross-sell on every order – just as you might be asked if you want to 'go large' when ordering at a counter face-to-face, prompts can be built into apps that encourage users to spend more – whether it's to get a voucher to receive a discount on their next order, or a freebie if they spend over a certain amount, these little touches increase the average basket value whilst also making the customer more likely to return.
As more and more food businesses experiment with unique ordering innovations to engage and retain customers, it is important to remember that getting the basics right is equally vital. In order to succeed, mobile apps should be developed with payment and transaction functionality at their core, rather than being an inefficient bolt-on or afterthought.
Customer payment trends are always evolving, and with so many new payment options now on offer, it can be daunting for businesses to choose the right methods, but considering the cultural context and attitudes to security and authentication can be the difference between closing a successful sale, or losing out to a competitor.