By David Payet, Grocery Retail & QSR Offer Manager, GSV at Worldline
There is no doubt that the quick service restaurant (QSR) industry took a huge hit during 2020 and 2021, as COVID-19 saw complete closures and the sudden need to shift all or most of sales online and those that stayed open had to adapt to social distancing and contactless payments. It is apparent that people are missing a sit down meal, as the number of Britons who said that they were likely to purchase from a restaurant or pub chain in the next 30 days fell 30 percentage points, down from 50 to 20.
However, the QSR sector is weathering the pandemic better than other sections of the food service industry – it was already at the forefront of digitalisation through the widespread adoption of click and collect – although there is no way to make up for the loss in eat-in sales. Of course, the best performer in the QSR field has been McDonalds, however they themselves have also experienced a 30% worldwide drop in income.
The decline of delivery apps
The QSR industry has adopted more digital technology in the past year than what they would be expected to in the next five to ten years. Almost every QSR outlet in the country will have some sort of digital technology, from the extensive ordering kiosks and apps, to Just Eat and Deliveroo ordering in smaller restaurants.
However, the dependency on delivery apps for taking orders, processing payments, and arranging delivery could be harmful long term. Delivery apps cut into profits, and at a time when restaurants are already strapped for cash, this occurring cost may have to be cut. Also, apps do not allow restaurants to take payments directly and everything has to be processed by an intermediary, adding an extra layer of complexity to a company’s payment infrastructure.
This complexity, and the overall challenge of digital transformation, means that some brands may struggle to integrate all aspects of their business with new digital systems. There are still gaps in contactless wallet acceptance, for example, and difficulties in integrating loyalty programs. Starbucks, for example, has a digital version of its loyalty card, but does not allow customers who order on Uber Eats or Just Eat to collect rewards. Moreover, such apps break up the customer experience, resulting in an incohesive journey.
Of course, the industry has come a long way since being bit by the pandemic and have adapted well by adopting digital technology, there is still room for improvements that will benefit both QSR companies and customers, particularly as lockdowns end and restaurants can return to normal.
The increased adoption of innovative payment solutions
When restaurants are allowed to re-open to full capacity, they will not be return to their pre-pandemic operating. Instead, many restaurants will implement adaptations that they first made during the course of the pandemic to improve customer service and efficiency.
With so much innovation happening over the past year, there is no reason to stop. New integrations and experiences are possible using the technology that expands upon the digital capabilities QSR companies are already using, for example, payments with Apple Pay and Google Pay enabling 1-click mobile loyalty subscription. This bypasses the need for plastic cards or merchant apps by deploying the loyalty card directly to a customer’s digital wallet.
Another innovative technology that is being introduced is scan and pay. Developed originally for the retail industry, this payment experience works well for people practicing social distancing measures. This solution could allow customers to bypass the checkout and payment process entirely by scanning the QR code to log in to the store, then scanning the barcode of each item before paying, with no interaction needed with staff. Additionally, it could allow ‘fast food’ restaurants and coffee houses to bring restaurant-style eat-in experiences, allowing their customers to scan their table and make an order through an app.
Digital solutions cannot work alone
However, in order to provide effectiveness, these new digital features will need to become integrated through an omnichannel solution that connects the dots between a customer’s online and in-store ordering. This will allow for an improved customer experience, leveraging tokenised payments and key features like reward cards to customer accounts seamlessly and across all platforms. This omnichannel solution is just as important for international franchisee chains as it is for smaller regional restaurants, creating a solid foundation on which to build the next innovations that will make consumers’ lives easier.
To learn more, visit: ingenico.com/omnichannel