Technology

Data, loyalty programs and off-premises technology to rise in 2022

As we enter 2022, brands are maturing into omnichannel, technology-centric and data-driven restaurant businesses. Here's what to expect in 2022.

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January 18, 2022 by Emil Davityan — CEO and co-founder, Bluedot

When the COVID-19 pandemic emerged, the survival of restaurants across the industry hinged on the ability to pivot almost instantly. Restaurants could no longer rely on the three-to-five year horizon once typical for the roll out of new technology.

Instead, the urgency and severity of the situation drove them to quickly deploy rudimentary curbside pickup and embrace third-party ordering and delivery solutions that were in line with social distancing. Even though some of the solutions were unautomated and inconsistent, customers initially accepted them as necessary. Operators started to make incremental improvements in 2021, often accelerating technology roadmaps at an unprecedented pace. All the while, consumers leaned more heavily into mobile ordering for speed of service and convenience.

This digital transformation that was catalyzed by the pandemic will continue to be fueled in the coming years by the M&A activity and IPOs that took place in 2021. This consolidation in the market was in large part motivated by the promise of cross-brand operational efficiency and access to transformative low-cost capital.

With growing tech budgets, brands are now hyper focused on how to transform their early off-premises and digital strategies, with an eye toward customer experience as a key differentiator. As restaurants see app usage continue to soar, they're now looking to consent-based consumer experiences to provide actionable insights into the customer's journey, to build loyalty and increase sales.

Now as we enter 2022, brands are maturing into omnichannel, technology-centric and data-driven restaurant businesses. Given everything that's happened in the industry since the pandemic, more change in the new year should come as no surprise. Here's what we expect in the year ahead:

In-store strategies take a back seat to investments in off-premises technology

As brands look to expand their technology stack, in-store legacy systems that require more resources to modernize (like point-of-sale systems and back-end kitchen solutions) will be a lower priority. Instead, brands will focus on off-premises or "over the store" solutions that are comparatively faster to deploy, including mobile technology, apps and loyalty programs, to create a better customer experience. By optimizing their off-premises solutions, brands can reach customers directly through personalized messages, customized menus, relevant promotions and offers, and more.

Brand loyalty will hinge on physical journey data

Restaurant app usage surged amid the pandemic, giving brands access to more data than ever before. Measurement of buying behavior and insights into the physical journey of customers (i.e., when and for how long a customer visited, if the order was placed on-premises or on mobile, and where an order was picked up) will be particularly vital. With copious amounts of data available, successful brands will focus on internal capabilities to analyze, orchestrate and execute data-driven operational and marketing strategies that promote that drive brand loyalty.

Ongoing investments in drive-thru and curbside automation

Amid the pandemic, brands leveraged automation to deliver contactless solutions for safe and sanitary transactions. Now the tight labor market and staffing shortages are reinforcing this trend, with ongoing investments in automation expected to persist and expand. The latest State of What Feeds Us report found that the majority of consumers prefer self-service and digital ordering via a mobile app or kiosk, over placing an order with a staff member. Leveraging automated solutions like apps, orchestrated messaging, kiosks and digital menu boards, brands will increasingly remove any remaining operational barriers to customers joining and utilizing loyalty programs, redeeming rewards and interacting with the brand in other ways that are controlled by, and personalized to, the customer.

Digitalization will help combat supply chain shortages

As brands continue to struggle with supply chain shortages, they will rely more on digitalization, including personalized digital menus that can be updated in real-time tailored to the customer. As shortages vary from region to region, customizable menu boards allow brands to rapidly remove unavailable items at relevant locations, preemptively communicate with customers, offer alternative items, or compensate them for any inconvenience.

Deals and promotions will reach across multiple brands

As consolidation continues in the restaurant industry, parent companies will centralize their marketing strategies across their brands. Offering greater flexibility in loyalty programs, brands can reward customers with deals and offers across a constellation of parent and subsidiary brands. As more brands aggregate these common strategies across corporate groups will first be seen as an important differentiator and later as a standard, if important, foundation for further growth.

Stronger collaboration between the CMO and CIO

As insights into consumer behavior drive stronger strategic marketing decisions, CIOs will come under pressure to provide access to the growing stores of customer and contextual data to multiple teams within the organization. This will result in CMOs exerting greater influence over IT budgets and technology decisions. Success will hinge not only on gathering more robust data, but analyzing it to develop new customer-centric programs, such as more targeted loyalty initiatives, marketing campaigns, and menu items.