Deliverect Omni Approach Whitepaper V2
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OMNICHANNEL FOR RESTAURANTS What is it? How Can it Benefit Your Restaurant? 2 IT’S MORE Modern restaurant customers demand convenience. They want high-quality meals IMPORTANT delivered or ready to pick up at the click of a button. THAN EVER With the rise of delivery, online ordering, kiosks, and many more new methods of interaction, multiple channels are required to meet the demands of the modern restaurant-goer. TO HAVE AN When you look at the predicted numbers pre-Covid-19, it’s clear that consumer demand was already driving massive digital OMNICHANNEL growth across the industry: | The global food delivery market is expected to reach $154 billion by 2023 STRATEGY | Digital orders at restaurants have grown at an average rate of 23% since 2013 and are predicted to triple in volume by the end of 2020 | Mobile ordering is forecast to grow to a $38 billion industry this year And since then, even though it has caused a global shutdown of economies, Covid-19 has also accelerated the use of contactless technologies, digital ordering, and delivery services even more. 3 With brick and mortar restaurants dealing with walk-in, pick-up, and delivery customers By the end of reading this paper you will and so many ways to order and pay for meals, be able to: getting all of your technologies and sales channels aligned is a daunting task. | Understand the multitude of channels restaurants can use At this time, it’s even more essential to have an omnichannel approach. | Identify the key tech players in each category But what is omnichannel, and what does it mean to implement it at your restaurant? | Break down the key advantages and disadvantages of the There are so many channels now and so omnichannel approach much technology, the challenge is to bring it all together into a coherent system. | Figure out the best way for your Restaurateurs are busy with operations so restaurant to use an omnichannel getting everything to work together is an approach to improve your customer overwhelming task. journey and increase sales Just choosing which delivery partners to use is hard enough, so trying to get your head around all the different channels and tech First, let’s deal with the question that is platforms, looking at pricing for multiple likely on your lips right now. subscriptions, and deciding which you do and don’t need is a significant undertaking. 4 WHAT EXACTLY IS OMNICHANNEL FOR RESTAURANTS? Customers are demanding Omnichannel versus convenience and restaurants multi-channel are responding. Omnichannel means embracing the different Single-channel ways customers can order, pay When you focus on just one sales channel for, and get their food in a holistic, you can only reach customers this way. streamlined system. The focus Whether that means walk-in diners or is on the customer journey as a customers acquired via delivery partners or online ordering. You can make this channel whole, rather than the experience as smooth and efficient as possible and on one channel or another. deliver an excellent customer experience, but you’re limiting the number of customers you In an omnichannel operation, data flows can reach and the richest of their interaction in a purposeful way and can be used with your brand. throughout the system, rather than being siloed. This brings a multitude of advantages Multi-channel to the modern restaurant. A multi-channel approach is when you sell The best way to understand the through more than one channel, including omnichannel approach is to compare in-person, online, and offline. You might cater it to what came before. to dine-in customers, walk-in customers for takeaway meals, and customers who order online for delivery, for example. 5 A multi-channel approach includes all Omnichannel also ensures data is collected of these different methods of interacting from each channel consistently in one place with customers but doesn’t connect them. and can be used effectively to improve You may be giving customers in each operations and the customer experience channel a great experience but the different down the line. This leads to many benefits channels are not integrated. So the customer and some challenges that we will experience in each channel is separate, discuss later. they can’t easily move between channels. A good way to get a deeper understanding Omnichannel of how the omnichannel approach impacts the hospitality industry is to first look Omnichannel takes the multi-channel at what’s happened to the retail industry over approach and builds bridges so customers the last decade. can move between channels seamlessly. Imagine that a customer finds your restaurant What can we learn from the on Doordash. They become a regular impact of omnichannel on retail? customer and order a meal once a week. However, because your profile is not branded, The restaurant industry has been slower they might walk past your restaurant every to adapt to digital than others largely because day and not dine in because there is no it is naturally a more physical, real-world connection between the two channels. industry. While getting a replacement pair of trainers delivered to your door can be more With omnichannel, you ensure that your convenient than heading to the local Foot interactions are consistent. So perhaps you Locker, you can’t fully recreate a multi-course add a menu to all takeaway orders and tasting menu experience at home. a voucher offering a discount when they dine in. You may be able to turn this regular delivery customer into a dine-in customer without a disconnect. 6 Top 10 Companies in the US, Ranked But the average restaurant has been But the danger was that physical stores by Retail Ecommerce Sales Share, 2020 digitizing more and more, with online turned into showrooms for online buyers. reservations, payment systems, and delivery People would go into a shop and try out % of total retail ecommerce sales platforms leading the way. a product, then head over to Amazon and make a purchase. An omnichannel approach 1. Amazon An interesting comparison that may help takes into account how the customer wants 38% us see the future for the restaurant industry to shop and solves this problem by keeping 2. Walmart is the move of retail online. High street shops them from buying elsewhere. 5.8% have been struggling since the internet connected us. The rise of sites like eBay and It does this by moving customers between 3. Ebay 4.5% then, of course, Amazon, have hit traditional channels, capturing data for remarketing, retailers hard. and generally offering a more complete, 4. Apple holistic experience, connecting online 3.5% The chart on the left shows Amazon’s current and offline. stranglehold over the retail industry. 5. The Home Depot 1.9% We are now seeing major online retail As Amazon cemented its dominance giants opening up brick and mortar stores 6. Best Buy over online retail over the last decade, as an additional channel. This closing of the 1.5% omnichannel became an essential tactic circle shows how important it is not to dismiss for retailers trying to survive. 7. Target a channel as redundant when it could 1.5% be used as part of an omnichannel approach Brick and mortar stores were forced to use to increase sales across the business. 8. Costco Wholesale whatever advantages they had over online 1.3% retailers. Namely, the ability for customers 9. Wayfair to walk in, browse products, and talk to staff. 1.3% In a brick and mortar store, you can pick up a product and see if it is right for you, 10. Macy’s you can try on clothes and make sure any 0.9% product is right before you buy. Note: represents the gross value of products or services ordered via each company’s website (browser or app), regardless of the method of payment or fulfillment; excludes travel and event tickets. Source: eMarketer, May 2020 7 THE OMNICHANNEL LANDSCAPE FOR RESTAURANTS As we’ve seen from the example of the transformation of retail, an omnichannel approach is not so much The biggest players: Meal Delivery - Monthly Sales a choice, it is essential if your restaurant is going to adapt and 450 July 2020 survive in a turbulent marketplace. 400 Share of Sales But the restaurant industry is not the same 1 350 Doordash - 46% as retail. It has its quirks and idiosyncrasies 300 that make integrating and managing multiple Uber Eats2 - 23% channels even more challenging than in almost 250 Grubhub - 21% any other business. 200 Postmates - 150 8% To help you get your head around what an U.S. Sales Indexed 3 omnichannel approach looks like for the 100 Other - 1% modern restaurant, let’s break down the various channels into two categories, Takeout, 50 and Dine-in, and look at the pros and cons of using each channel and the biggest players 2018 2019 2020 working in each space. 1Indexed to meal delivery Jan. 2018 sales (=100). Percentages may not add to 100 due to rounding. 2Does not include purchases made with Uber Cash. Some sales indistinguishable from Uber rides, especially in May-August 2019. 3Amazon Restaurants (prior to Jun ‘19 closure), Caviar (prior to Oct ‘19 acquisition), Waitr Source: Second Measure 8 Takeout Channels Doordash: In just seven years, Doordash has Just Eat: One of the earlier players focussing risen from Bay Area start-up to become the on takeaway restaurants and fast-casual biggest delivery provider in the US, operating before more upmarket restaurants started Last-mile Delivery (third-party and in-house) in more than 800 cities in 50 states and to offer delivery more widely, Just Eat taking 46% of the market.