Is Mobile Order and Pay the Fast Food Gateway Technology of Choice?

Image: McDonald's Canada

Is Mobile Order and Pay the Fast Food Gateway Technology of Choice?
By Dwayne Reno

It’s no secret that profits have slowed for foodservice operators. In a time when grocery store discounts are encouraging more and more Canadians to cook at home the foodservice industry needs new ways to grow shrinking profits. One route food operators have begun to travel down is automation. This week I would like to discuss mobile Order and Pay and why we will see more automation in the coming years because of it.

Mobile Order and Pay is Taking Over
Since its launch in January 2011 the Starbucks Mobile Order and Pay app has went on to do great things for the coffee chain. Mobile Order and Pay now represents 18 per cent of all in-store sales at Canadian Starbucks restaurants and growing.

However it seems that the app that was originally designed to help Starbucks reduce congestion at restaurants is now causing the vary thing it was designed to eliminate. Last year Starbucks experience congestion at the handoff point at many of its stores. The congestion was so bad that walk-in customers had to leave the store without making a purchasing. However, despite the current operational challenges Starbucks is confident that they will be able to resolve these issues without impacting revenues. The coffee chain has plans to release new in-store procedures and tools to help reduce customer wait times in the coming months.

All Aboard!
The operational challenges experienced by Starbucks have not slowed down the Mobile Order and Pay bandwagon, and it continues to gain new passengers.

Since the start of the year Restaurant Brands International, the parent company of Burger King and Tim Hortons announced plans to release their own Mobile Order and Pay app. The app is currently being tested at 25 select Tim Hortons in Ontario and 25 Burger King, locations in Miami. Even McDonald’s has finally got on board.

Back in July 2015, McDonald's CEO Steve Easterbrook talked about mobile ordering, saying that in the future customers will be able to order ahead with the chain's app and pick up their food when they arrive. However a launch date didn’t come until 2017. The fast food giant has now said they will be the first fast food restaurant to offer Mobile Order and Pay at all their U.S. restaurants by end of 2017.

Send in the Machines
The Mobile Order and Pay bandwagon continues to gain passengers and speed. In the meantime fast food operators continue the push towards automation by outfitting their restaurants with self-ordering kiosks. "These kiosks are growing in popularity with franchisees," stated David Trimm, Wendy's chief information officer. Trim also told investors that "current demands for self-ordering kiosks puts Wendy’s on track to having 1000 U.S. restaurants or more outfitted with self-ordering kiosks by the end of 2017."

According to Trimm self-ordering kiosks are helping the fast food industry accomplish two things:

1. They create more of an experience craved by younger millennial consumers.
2. They also help to reduce labor costs.

As baby boomers walk into retirement fast food chains are trying to reach millennials. Also with smaller profits and a workforce requesting $15.00 per hour the foodservice industry believes that now is the best time to send in the machines. Furthermore self-order kiosks and Mobile Order and Pay have the ability to track consumer spending. Tracking what customers buy can be used by fast food and even beverage operators to help introduce new menu items and product lines.

Let’s Get Automated!
I have listed two great examples of the fast food industry’s push towards automation. There are many more out there. Caliburger, a fast food chain in the U.S. has automated the flipping of their burgers. Cali Group partnered with Miso Robotics to develop Flippy the burger robot. Flippy made its debut in March of 2017, at the Pasadena, California CaliBurger.

Also, Greg Creed CEO of Yum Brands, the parent company of Pizza Hut, KFC and Taco Bell told CNBC that he believes “automation could replace humans in the foodservice industry by 2020”, which is much sooner than the prediction of 50 – 100 years given my U.S. Treasury Secretary Steven Mnuchin.

The automation of the foodservice industry is well under way. Fueled by fierce competition and higher operating costs, automation is seen by fast food operators as the path to higher and more stable profits.

Until next time your customers want to know why they should spend money at your restaurant, bar or cafe. So give them the goods!