Adding Digital Dining Priorities to the Menu

Consumer-facing technologies have become table stakes for success, but guests are insisting that foodservice operators raise the bar. In a changing foodservice space, digital is a primary driver of six major restaurant industry trends:

1. Reimagining ongoing guest engagement through digital experiences personalized for the guest (for example, loyalty programs with awards that match their taste).
2. Refocusing on off-premise (drive-thru, pickup-only sites and delivery) — all enabled by digital.
3. Transforming the labor model through kitchen automation technology or digital order kiosks.
4. Addressing changing tastes with methods such as custom menus built with rapid innovation to meet niche diets and wider tastes.
5. Real-time dynamic pricing, among other levers, to navigate volatile ingredient costs.
6. Blurring channel boundaries with nontraditional competitors entering the market.

Types of technology solutions that operators are most interested in learning more about include digital marketing/loyalty programs, back-of-house operations, automation and point-of-sale systems, among others. The good news is there are challenges that can be solved with technology, but retailers need to plan their priorities.

"If you don't know the ranking for you, what's the point?" Gurley said.

[Read more: Developing the Recipe for Foodservice Success]

Today's digital foodservice guests skew younger, consisting primarily of Gen Z and millennials but also including younger Gen Xers, and are 50% multicultural. They make spur-of-the-moment visits, seek digital payment options, and desire convenience and loyalty program rewards. Additionally, they are making up a larger and larger portion of foodservice orders — over the next decade, digital orders could represent 35% to 50% of total restaurant revenue. "And that's huge," Gurley noted.

The impact of digital engagement will mean different things for different brands, but there are three core elements that all operators can use as guidelines:

Make it relevant — Match consumers' nonconscious motivations toward a brand or product category. Determine the type of currency (points, dollars, etc.) that the program uses as well as how to opt in and set up the program from a consumer point of view.

Keep them engaged — Create loyalty offers that are more persuasive and likely to drive more consistent loyalty behavior. Determine how consumers start to build up the chosen currency once they've opted into a loyalty program and how consumers can spend what they've earned and what they get.

Keep it interesting — Draw consumers back in during periods of low engagement or stalled behavior. There are additional tactics that can be leveraged to draw consumers back or reengage.

Operators should also invest in understanding and influencing the digital path to purchase. Because most guests don't know what they want when they begin browsing a digital menu, operators can lean into the entire journey for opportunity to influence menu choices. Gurley recommended that retailers ensure their digital menus include branded beverage image assortment and feature bundles that include beverages to reach the 47% of guests who are likely to purchase a drink as part of a bundle. Additionally, 28% of guests are likely to add a beverage in a digital platform from a pop-up reminder, making it worthwhile to include a prompt to add a beverage to encourage meal completion.

It is by executing the fundamentals — assortment and awareness, bundles and capturing the upsell — that operators enable innovation, Gurley explained.

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