Commentary
1 QSR's approach to reclaiming the post-pandemic customer
For many restaurants, third-party delivery helped in a pinch during the early part of the pandemic, but now may be the time for new solutions for reclaiming the post-pandemic customer? One QSR, Wok Hei, found an answer.
May 4, 2021 by Chris Lybeer — Chief Strategy Officer, Revel Systems
For over a year, restaurants have grappled with the effects of the pandemic but are now thankfully witnessing a gradual shift towards reopening and a lift on dining restrictions in general. In this next phase, I predict that consumers' newly acquired dining habits will become more commonplace.
For example, I anticipate consumers won't give up their newfound love for ordering takeout and delivery, even as they start to return to indoor dining. Accordingly, restaurants will find fresh challenges in the sense that consumer demand is now balanced between onsite and offsite dining. In turn, businesses must consider balancing schedules, staff allocation, and different operational solutions to accommodate in-person, drive-thru, or off-premise services.
For many restaurants, third-party delivery helped in a pinch during the early part of the pandemic. But operators also quickly learned that these services can have an adverse impact on profits, and often are not tailored to meet individual restaurants' needs. For example, some third-party shortcomings include branding limitations and lack of control over the overall customer experience. In the long term, restaurants will need to determine how to provide these services more cost-effectively in order to maintain their profitability.
One such example of off-premise service done right is Wok Hei, a QSR in Tustin, California, that provides fast, fresh Chinese food. As an early adopter of delivery solutions, the restaurant partnered with several third-party services in 2017 as part of the brand's digital delivery business strategy.
When the pandemic hit, Wok Hei experienced a double-digit increase in online ordering. Yet they were now dealing with a deluge of disparate ordering systems which — paired with a massive increase in online orders — added unnecessary complexity to their operations
When third-parties integrate with a restaurant's ordering process, the process gets muddier in terms of who owns the customer experience and how those merchants can close the feedback loop when applicable. The more entities involved in an order, the more risk there is of a breakdown in the process.
In an attempt to simplify and streamline their operations, Wok Hei opted for a next-gen delivery management solution from my company designed to help restaurants manage their own delivery operations and compete with the delivery experience offered by larger brands.
"I was able to get rid of so many standalone platforms I was using and do it all-in-one. That made it so clean and efficient to do deliveries and communicate with customers and manage online ordering," Wok Hei owner Michael DeAngelo said.
When restaurants have their own online ordering, it becomes a single source of truth. It is there — and not on a third-party site — that restaurants can capture customers' information. This enables restaurants to market to these customers, build deeper loyalty, and communicate with them more effectively.
Third-party ordering and delivery have their place, but restaurants cannot afford to have up to 40% of their business going through a channel that costs them 30% of their profits. It doesn't provide enough margin to survive.
As restaurant owners shift into the reopening phase, they will need technology that is easy to implement and adaptable to change. Having a branding tool built into a POS platform where operators can easily add their assets, hit save and be up and running for orders, drive-thru, or delivery gives restaurant owners the ability to flex and shift.
Due in large part to advancements in technology, the way a restaurant runs in 2022 and 2023 will feel quite a bit different, and indeed better, compared with how it operated in 2019. As restaurant owners look ahead to the next phase of uncertainty and opportunity, they must create a foundation on which to reclaim their customers and, in turn, their bottom line.
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Revel Systems is an open cloud order management platform at the heart of our clients’ business. Through flexible architecture and open API, Revel ensures brands have the freedom they need to design a full tech stack that meets their needs, enabling them to provide an unmatched customer experience, diversify revenue streams, and scale with ease.
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