Unwrapping Chipotle's Evolving Digital Ordering Strategy

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Unwrapping Chipotle's Evolving Digital Ordering Strategy
FEATURE STORY – PAGE 9

                     Unwrapping
                     Chipotle’s Evolving
                     Digital Ordering
                     Strategy

                     NEWS AND TRENDS – PAGE 13
                     Domino’s to test self-driving pizza delivery

                     DEEP DIVE – PAGE 18
                     QSRs turn to AI to upgrade their CRM strategies

D ECE M B E R 2019
Unwrapping Chipotle's Evolving Digital Ordering Strategy
Unwrapping Chipotle's Evolving Digital Ordering Strategy
04   What’s Inside
     A look at how QSRs are creating compelling mobile ordering
     services to capture more spending

09   Feature Story
     Nicole West, vice president of digital strategy and product
     at Chipotle, discusses the chain’s growing portfolio of
     digital ordering channels and how such options affect labor
     organization and delivery

13   News & Trends
     The latest on restaurants’ automation efforts, including Salad
     Station’s salad-making robots and Domino’s driverless delivery
     service

18   Deep Dive
     A data-driven analysis of how QSRs are embracing AI- and
     ML-enhanced solutions to boost sales, personalize services
     and spare workers from monotony

21   About
     Information on PYMNTS and Paytronix

     Acknowledgment
     The Order To Eat Tracker® is done in collaboration
     with Paytronix, and PYMNTS is grateful for the
     company’s support and insight. PYMNTS.com
     retains full editorial control over the following
     findings, methodology and data analysis.
Unwrapping Chipotle's Evolving Digital Ordering Strategy
Unwrapping Chipotle's Evolving Digital Ordering Strategy
W H A T ’ S       I N S I D E

Quick-service restaurants (QSRs) are well aware of con-        how QSRs are rolling out both mobile and non-mobile
venient mobile order deliveries’ benefits. Customers           innovations to smooth ordering and delivery.
typically spend more through mobile or online channels
than when buying in person, making delivery lucra-             AROUND THE ORDER TO EAT SPACE
tive and prompting fast-casual chains to encourage             Pizza chain Domino’s is putting a fresh focus on deliv-
such ordering.                                                 ery, recently announcing plans for self-driving vehicles
                                                               to deliver its orders around Houston, Texas. Customers
QSR titan Wendy’s has poured millions of dollars into
                                                               will receive mobile alerts and access codes when
digital investments, and its efforts have spurred a
                                                               their orders are nearby, and they can type the codes
20 percent increase in average mobile order check
                                                               into vehicles to retrieve their meals from specialized
sizes. Texas-based wings chain Wingstop has similarly
                                                               compartments.
worked to increase its mobile ordering service’s avail-
ability, intending to offer the options at 90 percent of its   Another major brand is reexamining car-side meal col-
brick-and-mortar locations by the end of 2019.                 lection but focusing on drive-thru customers. KFC
                                                               is planning to improve its drive-thru technologies in
Existing mobile ordering service providers are develop-
                                                               2020, considering the use of artificial intelligence (AI)-
ing their offerings to keep customers returning. Mobile
                                                               enhanced digital menus to upsell select items and
delivery platform DoorDash announced a concept kitch-
                                                               improve orders’ accuracy.
en that differentiates itself from competing services by
allowing ordering customers to select items from var-          Companies must ensure that their innovative updates
ious restaurants at once. The company is supporting            are affecting customers as intended, however. Loyalty
the program via a virtual kitchen through which partici-       program and customer engagement solution provid-
pating restaurants can make to-go-only items.                  er Paytronix recently released an order and delivery
                                                               module to help restaurants evaluate their customer ser-
Mobile is getting serious attention in the space but is
                                                               vice efforts, enabling store managers to survey patrons
far from the only developing channel for QSRs. The
                                                               shortly after they make purchases. The product allows
December Order To Eat Tracker® details the latest in

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Unwrapping Chipotle's Evolving Digital Ordering Strategy
W H A T ’ S      I N S I D E

                                            QSRs to address potentially unsatisfied consumers’
                                            complaints and offer coupons that encourage a sec-
                                            ond chance.

                                            To learn more about these stories and other recent
                                            headlines from the space, check out the Tracker’s News
                                            and Trends section (p. 13).

                                            UNWRAPPING CHIPOTLE’S DIGITAL
                                            TRANSFORMATION
                                            Fast casual restaurant chain Chipotle Mexican Grill re-
                                            cently announced that it saw an 88 percent jump in
                                            digital sales from last year. The news follows the addi-
                                            tion of a voice-activated Amazon Alexa reordering skill
                                            and the nationwide extension of Chipotle’s AI-powered
                                            phone ordering system. In the Tracker’s Feature Story (p.
                                            9), Nicole West, Chipotle’s vice president of digital strat-
                                            egy and product, explains how the QSR engages with
                                            customers as it expands its digital ordering services.

                                            DEEP DIVE: HOW ENHANCED CRMs
                                            CAN STRENGTHEN QSRs’ CUSTOMER
                                            SERVICE
                                            QSRs are harnessing the latest technologies to improve
                                            customer relationship management (CRM) systems,
                                            benefiting both their patrons and their bottom lines.
                                            Companies like McDonald’s are using AI-powered dig-
                                            ital drive-thru menus that recommend items based on
                                            customer and environmental data, featuring hot items
                                            like coffee on chilly days. The fast food chain is far from
                                            alone in tapping into these innovations, though. This
                                            month’s Deep Dive (p. 18) examines how QSRs are le-
                                            veraging automation to improve order accuracy and
                                            encourage spending as well as how such technologies
                                            can brighten customers’ experiences.

6 | © 2019 PYMNTS.com All Rights Reserved
Unwrapping Chipotle's Evolving Digital Ordering Strategy
BUILDING CUSTOMER PROFILE

 ACQUIRE                               ORDER                                    EAT
CUSTOMERS

                                                                           IN          OUT
                                WEB        APP      STORE            RESERVATION     DELIVERY

                                  PAYMENT                 REWARD                   REDEEM

                                                                                                   IDENTIFY
                                                                                               PREFERENCES
              PROMPT                ANTICIPATE               TARGET OFFERS
                                     REORDER

            One-to-one offers via email • SMS • In-app messages • Push notifications • Geofencing

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Unwrapping Chipotle's Evolving Digital Ordering Strategy
W H A T ’ S       I N S I D E

                          10%                           23,000
                               Share of Wendy’s total   Number of McDonald’s
                               sales projected to       restaurants offering
                               originate from digital   delivery
                               orders by 2024

                          65%                           16
                               Share of KFC orders      Number of U.S.
                               made via drive-thru      markets in which
                               lanes                    Starbucks delivers

                          25%
                               Year-over-year
                               increase in Dunkin’s         FIVE
                                                           FAST
                               on-the-go mobile
                               order volume

                                                          FACTS

8 | © 2019 PYMNTS.com All Rights Reserved
Unwrapping Chipotle's Evolving Digital Ordering Strategy
Unwrapping Chipotle’s Evolving Digital
        Ordering Strategy

         Fast casual chain Chipotle Mexican Grill became one        Recent data indicates that digital ordering capabili-
         of the first major restaurant brands to pioneer the        ties are a key ingredient in Chipotle’s business model.
         mobile ordering experience in 2008. The company has        Digital sales helped the company’s revenue jump by 15
         since expanded its digital ordering portfolio to include   percent in third quarter 2019, and its digital orders rose
         AI-powered phone ordering, drive-thru pickup lanes and     by 88 percent from the same quarter the previous year.
         a reordering feature through Amazon’s Alexa.               Such sales now represent 18 percent of the firm’s total
                                                                    business.

10 | © 2019 PYMNTS.com All Rights Reserved
F E A T U R E       S T O R Y

Investing in digital ordering experiences is now a core     question. Customers have fun with it and they love
part of the company’s business model, according to          the ease.”
Nicole West, Chipotle’s vice president of digital strat-
                                                            She added that AI enables Chipotle to provide more
egy and product. West recently spoke with PYMNTS
                                                            convenient experiences, which are central to its digital
about how the chain supports ordering innovations and
                                                            ordering strategy. Offering a range of ordering methods
examines customers’ preferences to improve future
                                                            ensures that every point of engagement is as seamless
experiences.
                                                            as possible.
“In addition to menu innovation, digital innovation is
                                                            “I think customers expect to be able to engage with the
core to the experience we are looking to deliver to our
                                                            brand on their terms and to be able to order exactly what
customers,” West said.
                                                            they want, at the time they want it [and for it] to arrive in
                                                            front of them by the means they choose,” she said.
REAL INGREDIENTS MEET AI
Chipotle has rolled out several AI-powered digital or-      HOW DIGITAL ORDERING DRIVES
dering solutions over the past year, and its most recent    LABOR ORGANIZATION
innovation is an Amazon Alexa skill that enables cus-       West explained that Chipotle addresses new technolog-
tomers to reorder their past meals via voice command.       ical ordering capabilities with a two-pronged approach.
Users can download the Alexa app and activate the skill     The first step involves utilizing a customized digital plat-
to place delivery orders on their favorite meals.           form, which enables the QSR to add customer-facing
The chain also expanded its phone-based voice assis-        ordering solutions as long as they follow specific pa-
tant ordering service to approximately 2,500 locations      rameters and standards.
nationwide. The system prompts customers to place           The second step requires ensuring that Chipotle staff
their orders and asks clarifying questions or suggests      can handle the influx of both digital and in-person
optional ingredients. Customers can then pay for their      orders. The chain established new “make lines” to pro-
food via the system, which saves customers’ preferenc-      cess digital orders, and West said the lines would focus
es for future orders.                                       on the accurate and efficient fulfillment of digitally ini-
West said these types of AI-powered enhancements            tiated sales.
can resonate positively with customers.                     “Once volume started to pick up, it became evident that
“I think customers leave those experiences thinking,        the future of the digital business was going to contin-
‘Wow, that was really easy and pretty cool! I am able to    ue to grow,” West said. “We needed to make sure that
get Chipotle ordered exactly how I want it, really quick-   our [operations] team was able to handle that with ease.”
ly,’” West said. “When ordered the exact same way the
next time, [the system is] already smarter and is able to
interpret exactly what they want and get it right without

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F E A T U R E       S T O R Y

         ENHANCING DELIVERY EXPERIENCES
         Orders assembled by the second Chipotle make line are
                                                                          Under The
         placed on pickup shelves for customers who phoned
         in or used their mobile devices to make purchases.               HOOD
        This second make line is also critical to ensuring that
         Chipotle can quickly fulfill delivery orders and hand
         them off to third-party services like DoorDash and          Nicole West, Chipotle’s vice president of
         Postmates. West said Chipotle observed increased            digital strategy and product, explains the
         demand for delivery in various regions across the U.S.      QSR chain’s twofold investment approach
                                                                     toward digital ordering technology.
         when it first began partnering with delivery provid-
         ers in 2015.

        “Our customers have been asking for delivery in more         “One is the technical foundation. We built a plat-
         and more places,” she said. “We’re fortunate because        form that is custom-designed, architected and built
         our ops teams are well set up with a make line to execute   in-house that allows us to pretty simply add new
         on delivery orders. We’ve been able to give customers       customer-facing order channels, as long as all of the
         exactly what they want from that delivery experience.”      standards and many rules are followed. That founda-
                                                                     tion, that platform, is critical to our ability to add new
         Chipotle’s digital strategy has addressed significant
                                                                     order channels.
         shifts in how the chain handles back-end operations,
         how customers place orders and how the company ful-         On the other side — downstream or a bit behind the
         fills delivery requests. New tools and innovations like     scenes — are our teams in restaurants who are ex-
         AI, delivery partnerships and upgraded operations man-      ecuting the orders. We’ve really taken care to make
         agement methods are proving to be welcome additions         sure they have all the tools they need to execute
         to the chain’s digital menu.                                quickly and accurately on all the orders as volume
                                                                     continues to increase. All of our restaurants are
                                                                     now equipped with digital ‘make lines,’ [which are
                                                                     like] mini-digital restaurants within the restaurants.
                                                                     They’re also equipped with mobile order pickup
                                                                     shelves. As orders are completed, they’re placed on
                                                                     these shelves for customers and delivery providers
                                                                     to pick up. We’ve continued to roll out ‘Chipotlanes,’
                                                                     which are drive-thru pickup windows. Reaction to
                                                                     that has been positive, both with our customers and
                                                                     with our crew members.”

12 | © 2019 PYMNTS.com All Rights Reserved
N E W S      &   T R E N D S

         Delivering on                                                 McDONALD’S LOOKS FOR DELIVERY
                                                                       TO DRIVE SALES, CONTINUES
         customer service                                              TECH PUSH

         STARBUCKS ROLLS OUT DELIVERY TO                               Delivery is becoming a premium revenue source for
         ADDITIONAL US MARKETS                                         QSRs, even as many spend to innovate their digital tech-
                                                                       nologies at brick-and-mortar locations. McDonald’s is
         United States-based coffee chain Starbucks is among
                                                                       among chains that have seen online delivery figures
         several QSRs looking to satisfy customers with online
                                                                       jump in the past three years, expanding its own service
         delivery. The company has expanded its partnership
                                                                       to encompass 10,000 restaurants — 70 percent of its
         with third-party delivery platform Uber Eats to serve
                                                                       locations — across the U.S. Delivery is also expected
         Atlanta, Denver, Philadelphia, Phoenix, New Jersey and
                                                                       to generate $4 billion in sales for the chain by the end
         the New York metro area, aiming to make delivery na-
                                                                       of 2019, according to recent interviews with company
         tionwide by the end of 2020. The Starbucks Delivers
                                                                       executives.
         service was launched in late 2018 and now operates in
        16 U.S. markets.                                               That $4 billion will account for just 4 percent of
                                                                       McDonald’s total sales for the year, however. Such a
         Starbucks has also expanded its platform outside the
                                                                       figure could explain the company’s increased spend-
         U.S., launching the program in 15 international markets
                                                                       ing on storefront technologies, including the AI and
         including Canada, China, Hong Kong, Indonesia, Japan,
                                                                       data-driven interactive menus at drive-thrus possible
         Mexico and the United Kingdom. It has partnered with
                                                                       via its recent acquisition of technology and AI provid-
         mobile delivery firm Ele.me, which Chinese eCommerce
                                                                       er Dynamic Yield.
         company Alibaba supports, for its Chinese deliveries.

                                                                       WINGSTOP EMPHASIZES DIGITAL
         BURGER KING SUPPORTS ONLINE
                                                                       SALES, EXPLORES DELIVERY
         DELIVERY THROUGH UBER EATS
                                                                       INNOVATIONS
        Third-party platforms are competing to deliver orders for
                                                                       Texas-based chicken wing QSR Wingstop is adding
         QSR brands that need to reach diners at home. Burger
                                                                       to its digital sales figures as it focuses on its mobile
         King recently announced it will partner with Uber Eats to
                                                                       app ordering and online delivery capabilities. Digital
         deliver to the former’s U.S. customers, and it promoted
                                                                       sales now account for 36 percent of the chain’s total,
         the service’s launch with free delivery for a limited time.
                                                                       which reached $49.9 million in third quarter 2019, and
        The partnership allows customers to order through the
                                                                       Wingstop is pushing to boost that share through online
         Uber Eats app rather than Burger King’s. The QSR will
                                                                       and mobile delivery initiatives. CEO Charles Morrison
         thus not have to compete for space on consumers’
                                                                       said the brand’s long-term goal is to make every trans-
         smartphones, though it could see reduced user engage-
                                                                       action digital and that the intends to offer delivery at 90
         ment and orders compared to a branded offering.
                                                                       percent of its locations by the end of 2019.

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N E W S       &   T R E N D S

Expansion strategies                                        KFC TO EXPLORE AI-DRIVEN DIGITAL
                                                            MENU BOARDS IN 2020
DOORDASH LAUNCHES GHOST                                     Established QSRs are developing AI to improve cus-
KITCHEN CONCEPT IN CALIFORNIA                               tomers’ ordering experiences at drive-thrus and
Some third-party delivery apps are using ghost or virtual   physical locations. Fast food chain KFC announced
kitchens to expand their delivery offerings, and mobile     that it will focus on such innovations in 2020, and its
delivery platform DoorDash recently announced one           chief technology officer, Christopher Caldwell, said the
such venture in Redwood City, California. Its DoorDash      company could potentially roll out AI-powered digital
Kitchens concept is similar to one that delivery platform   menu boards at its restaurants. The technology would
Grubhub and fast-casual restaurant chain Just Salad         increase drive-thru orders’ accuracy or upsell certain
launched earlier this year. DoorDash is differentiating     menu items.
its ghost kitchen by allowing users to order items from
                                                            Drive-thru orders account for 65 percent of KFC’s total,
more than one QSR, a feature Grubhub currently does
                                                            and the chain is examining how to effectively leverage
not offer. The DoorDash kitchen will fulfill orders from
                                                            the channel as digital ordering becomes more preva-
Giant Hamburgers, The Halal Guys and Rooster & Rice,
                                                            lent. The company is also researching how AI-enabled
among other chains, delivering to 13 neighborhoods
                                                            menu boards could affect the nature of QSR jobs and
around Redwood City, including Atherton, Belmont and
                                                            alter drive-thru workers’ roles.
Palo Alto.

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N E W S      &   T R E N D S

        WENDY’S ANNOUNCES GOAL TO                                       Nuro’s electric cars are designed to make deliveries all
        INCREASE DIGITAL ORDERS BY 2024                                 day without recharging, and Domino’s customers who
         KFC is examining new technologies to bolster its               receive driverless delivery orders will be sent mobile
         drive-thru sales, but other QSRs are refocusing on             notifications and access codes when their orders are
         other ordering channels. Wendy’s officials announced           nearby. The codes allow them retrieve their stored or-
         during the chain’s latest earnings call that the compa-        ders from individual compartments.
         ny is working to make digital orders 10 percent of its
         total sales, a goal it hopes to meet by 2024. Digital or-      SALAD STATION TO DEPLOY MORE
                                                                        SALAD-MAKING ROBOTS
         ders currently account for 2 percent of its orders, and
         the company has invested $25 million into platform             Louisiana-based QSR Salad Station is looking to bring
         development.                                                   100 of its salad-making robot kiosks to Houston within
                                                                        the next three years. The kiosks were developed by au-
         Laura Titas, Wendy’s chief digital experience officer,
                                                                        tomated technology provider Chowbotics Inc., and each
         noted that customers are consistently spending more
                                                                        machine takes 60 seconds to create one of approxi-
         through both online and mobile channels than in stores.
                                                                        mately 1,000 different salad types. The QSR is relying
         Company research research shows mobile order sizes
                                                                        on the solution to increase order speed and accuracy as
         are 20 percent larger than those made via other meth-
                                                                        well as build a more technology-heavy brand.
         ods and that delivery is becoming the channel through
         which consumers spend the most — delivery checks are           Salad Station is using the kiosks as part of a partner-
         50 to 60 percent larger on average than those made at          ship with salad robot provider RoboFresh, aiming to
         drive-thrus or physical locations.                             install the solutions at the QSR’s new brick-and-mortar
                                                                        restaurants. Five locations featuring the technology will
                                                                        open in Houston within the next three years, with 40
        Automation and                                                  more planned for rollout over the next decade.
        innovation
                                                                        KFC UK AND IRELAND DEPLOYS
         DOMINO’S WILL TEST DELIVERY                                    KITCHEN AUTOMATION SOFTWARE AT
         ROBOTS IN HOUSTON                                              MORE THAN 900 STORES
         Pizza chain Domino’s relies on its own drivers to deliv-       KFC has successfully tested new delivery-focused
         er orders, putting it at a disadvantage when competing         kitchen management software and will deploy the solu-
         with QSRs that use third-party platforms. The compa-           tion at more than 900 locations across Ireland and the
         ny is thus experimenting with robot delivery methods. It       United Kingdom. The QSR has selected ConnectSmart
         is partnering with autonomous vehicle and technology           Kitchen automation software from technology firm
         provider Nuro to roll out its first driverless vehicle solu-   QSR Automations to boost its order fulfillment speed
         tions in Houston, Texas by the end of 2019.                    and efficiency after the trial resulted in decreased order
                                                                        error rates. The product can provide management

16 | © 2019 PYMNTS.com All Rights Reserved
N E W S       &   T R E N D S

capabilities from secure and centralized locations,          FEEDback to help QSR managers improve online cus-
track staff performance metrics in real time and help        tomer engagement. The solution helps managers
kitchen stations better handle dine-in and delivery or-      gauge customers’ interactions and quickly intervene
ders. The software’s rollout was driven by the chain’s       when guests have had unsatisfactory ordering or deliv-
desire to streamline its operations and exceed delivery      ery experiences.
demands, according to Brad Scheiner, chief technology
                                                             FEEDback works by sending customers surveys with-
officer of KFC U.K. and Ireland.
                                                             in two hours of their orders that ask them to rate their
                                                             experiences on a scale of one to five. Responses are
Rewards and features                                         consolidated into reports highlighting results along
                                                             with each guest’s lifetime value and are immediate-
DUNKIN’ ENHANCES DIGITAL
                                                             ly made available to store managers, who can address
REWARDS, LOYALTY TO ENTICE
CUSTOMERS                                                    customers’ grievances by sending them automated or
                                                             customized apology messages as well as coupons.
Other QSRs are turning to online loyalty and rewards of-
ferings to boost ordering, including coffee chain Dunkin’.
The QSR expanded its DD Perks loyalty system to all
U.S. members in early September, allowing customers
to earn points regardless of their payment methods. It
built on the program’s expansion by creating an on-the-
go “guest ordering” feature that allows non-Perks
members to make mobile orders. Dunkin’ processed 18
million such mobile orders in Q3 2019.

The new features allow Dunkin’ to better engage with
mobile customers who are not members of its loyalty
program. Giving non-members incentives to download
the app could lead to an increase in DD Perks signups
over the next few quarters.

PAYTRONIX INTRODUCES FEEDBACK
FEATURE
Dunkin’ is not the only brand unveiling new features to
encourage repeat customer ordering. Loyalty program
and customer engagement solutions provider Paytronix
recently rolled out an order and delivery module called

                                                                                           © 2019 PYMNTS.com All Rights Reserved | 17
Serving Up Better Customer Service
With Enhanced CRM
Almost everyone has experienced a quick food run that       Using complex data systems to boost business is
turned into a 45-minute ordeal, but such delays are         sometimes seen as a cold, calculating way to run cus-
bad news for both QSRs and patrons. Long drive-thru         tomer service-focused industries, but QSRs are using
lines can overwhelm employees and frustrate custom-         AI-based CRM tools to benefit themselves and their
ers, occasionally irritating the latter enough that they    consumers. The following Deep Dive explores how such
leave without making purchases. It is thus no wonder        software solutions can personalize and enhance con-
so many big-name QSRs are turning to the latest digital     sumers’ fast food experiences.
technologies to tackle the problem.
                                                            PERSONALIZING CRM WITH AI AND ML
McDonalds acquired AI startup Dynamic Yield for $300
                                                            CRM refers to the collection of procedures — usual-
million in March 2019 to integrate the latter’s solutions
                                                            ly software solutions — businesses use to interact
into its CRM platform. The new system will maximize
                                                            with their customers. AI- and machine learning (ML)-
profits by enticing drive-thru customers to order addi-
                                                            supported systems are at the cutting edge of CRM, and
tional or more expensive menu items, increasing output
                                                            the market for related AI solutions is rapidly expanding.
per second for each location.
                                                            Some estimates claim AI-enabled CRM software is on
Dynamic Yield’s system gathers data on McDonald’s
                                                            course to increase global business revenue by as much
customers and records environmental factors such as
                                                            as $1.1 trillion from 2017 to 2021. Using such tech-
location, precipitation and temperature. It then uses
                                                            nologies to enhance CRM capabilities allows QSRs to
AI to analyze the data and determine which items con-
                                                            provide customers with AI-enabled screen access at
sumers would be most likely to purchase via drive-thru,
                                                            select McDonald’s drive-thrus, offering personaliza-
allowing smart screens to display products like
                                                            tion that would be impossible to match by relying on
McFlurries on warm days or hot coffee on cold days, for
                                                            traditional Excel spreadsheet analysis. QSRs have
example. Some McDonald’s locations already use such
                                                            historically used the latter method to review custom-
solutions, and the company eventually plans to add the
                                                            ers’ data.
technology to 14,000 U.S. restaurants via drive-thrus,
self-service kiosks and its mobile app.                     Some QSRs are taking AI-powered solutions even fur-
                                                            ther, providing mobile apps that allow customers to
Implementing this high-level data analysis at such a
                                                            access such services wherever they are — or at least
massive scale may seem like a Herculean task, but
                                                            wherever they are before they pull into drive-thrus.
McDonald’s is far from the only major QSR chain at-
                                                            Sonic introduced a mobile app in May that authenti-
tempting to do so. Starbucks spent much of 2019
                                                            cates customers’ identities when they log in, retrieving
enhancing its own CRM system with an AI solution
                                                            their data and providing them with customized menus
called Deep Brew to automate menial tasks, and KFC
                                                            catered to their tastes. The app then allows them to
and Taco Bell are testing similar concepts at their U.S.-
                                                            change their menu options and place their orders using
based self-service kiosks and drive-thrus.
                                                            voice-recognition technology.

                                                                                            © 2019 PYMNTS.com All Rights Reserved | 19
D E E P     D I V E

         Such AI-powered solutions bring the personalization of-    also give employees more time to foster personal rela-
         fered at brick-and-mortar locations to customers’ cars,    tionships with brick-and-mortar customers.
         homes or anywhere else they use merchants’ apps.
                                                                    Many QSRs see integrated AI- and ML-based CRM sys-
         Consumers once stepped up to registers at their usual
                                                                    tems as tools that can automate routine functions,
         fast food locations and ordered from familiar faces
                                                                    enabling human workers to concentrate on customer
         who knew their favorite items by heart. They can enjoy
                                                                    service. Starbucks’ CEO Kevin Johnson said the com-
         similar experiences via digital technology, thanks to
                                                                    pany’s goal for its Deep Brew AI is less to reduce costs
         AI-enabled CRM software.
                                                                    and enhance efficiency but more to focus on “nurtur-
                                                                    ing humanity” by giving monotonous tasks to machines,
         EXPANDING SERVICE: THE CLOUD
         FACTOR                                                     allowing employees to engage in more creative, reward-
                                                                    ing pursuits. Such prioritization will give workers more
         AI and ML are useful tools, but both run on data. This
                                                                    time and energy to foster strong interpersonal relation-
         means QSRs must collect and store customer and en-
                                                                    ships with customers.
         vironmental information to harness the full potential of
         these technologies.                                        Relying on machines and algorithms to perform basic
                                                                    tasks also reduces human error, and these faster au-
         Such data has historically been stored on in-house
                                                                    tomated processes can reduce the time customers
         servers, but many QSRs are forgoing these solutions for
                                                                    spend in line. QSR Chipotle Mexican Grill has seen suc-
         cloud-based servers outsourced from third-party pro-
                                                                    cess with its own AI-based ordering system, which was
         viders for several reasons. Cloud servers are cheaper
                                                                    introduced earlier this year. The system converses with
         to set up and maintain, and they streamline the obtain-
                                                                    drive-thru customers and transfers the information to
         ing and sharing of data because they can be accessed
                                                                    human employees, who can more quickly begin working
         from any location with Wi-Fi.
                                                                    on orders. It also ensures that orders are not misheard
         Starbucks is a prime example of a QSR that is using        and shields employees from dealing with difficult pa-
         cloud-based data storage capabilities to expand its        trons. The company hopes to implement the system at
         reach. It announced in July that it was teaming up         all 2,500 U.S. locations by 2020.
         with technology startup Brightloom on a cloud-based
                                                                    The industry is growing increasingly reliant on
         solution to bring order-ahead and other services to cus-
                                                                    cutting-edge technologies such as AI, ML and
         tomers around the globe. The reason was simple: The
                                                                    cloud-based data storage, but this does not mean QSRs
         coffee chain operates in 80 markets, but its mobile app
                                                                    are no longer delivering personalized customer service.
         and order-ahead services were available in only half of
                                                                    These technologies are instead helping businesses find
         them. The proposed cloud solution would bring these
                                                                    new ways to deliver high-quality customer service while
         features to all its customers.
                                                                    reducing human strain. It thus falls on individual QSRs
         FREEING EMPLOYEES FROM                                     to determine which technologies should enhance their
         MONOTONY                                                   CRM systems and how those solutions can be tailored

         Offering customers personalized services is just one       to provide ideal customer experiences.

         benefit of AI-enabled CRM tools. Such solutions can

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                                             meet on the web to learn about “What’s Next” in payments
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                                             cutting edge of this new world.

                                             Paytronix provides software-as-a-service (SaaS) custom-
                                             er experience management (CXM) services for restaurants.
                                             Its portfolio includes loyalty, gift and email solutions for
                                             fast-casual, fast food and quick service restaurants. Once
                                             implemented, these can be used to help establishments el-
                                             evate their brand profiles. Its offerings can also be used to
                                             generate data insights to help restaurants pinpoint opportuni-
                                             ties to improve their operations and customer engagements.
                                             The company’s platform can integrate with many wide-
                                             ly used restaurant POS systems. For more information, visit
                                             https://www.paytronix.com.

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                                             please email us at OrderToEatTracker@pymnts.com.

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