Online Ordering Brings New Loyalty Pool for Food Retailers

NEW YORK — With consumers changing how, when and where they get food, retailers and restaurants now have a new avenue to build up their loyal customer base: online ordering.

But first, it's time to turn the whole concept of loyalty on its head, according to John Meister, senior vice president and chief information officer at Panera Bread, operator of more than 2,100 bakery-cafes in 48 states and Canada. 

"For years, customers have registered with food retailers who then marketed to those customers. The reality is, in today's world, what you need to think about is easing the customer's journey and experience," Meister explained during the recent NRF 2022: Retail's Big Show hosted by the National Retail Federation (NRF). 

To do this, Panera Bread focuses on three key questions:

• How can it reduce the friction?
• How can it increase a customer's access?
• How can it grow the customer experience into a customized experience?

Another important piece of building a loyal customer base is measuring each interaction — before and after. "We are trying to determine what causes people to decelerate visits or accelerate visits," Meister said. "You can learn from both."

Reducing Friction & Improving the Guest Experience

Gone are the days of collecting email addresses for marketing messages. Today, the customer interaction can start with storing a delivery address or payment credentials — anything to make the customer journey a little easier each time.  

"The key is reducing friction," said Meister. "In the first days of web commerce, we used to say that if you could reduce a second off web performance time, revenue from that channel will go up about 10 or 11 percent. That actually applies to the whole customer journey."

Food retailers need to not only think about getting the order, but also fulfilling the order. He cited three examples of easing friction in the fulfillment part of the customer journey:

1. A customer logs onto the WiFi in the restaurant's parking lot, orders through their mobile device and inputs a parking space number;
2. Restaurant employees find the customer outside — without the need for a parking spot number — based on geolocation; and
3. A receipt verifies what is in the order.

As Meister pointed out, the more channels a customer uses, the more that customer's frequency increases. "There is a series of channels they will graduate to," he said, noting that not everyone is the same. "Not every consumer is going to graduate to the mobile phone; most will. However, there are some who are more aspired by a cashier at the point-of-sale or a kiosk, so their ideal use case is different."

Armed with this information, a company can tailor its rewards and thinking, and encourage people to cross channels and even dayparts, Meister advised. 

This year's NRF event took place at the Jacob K. Javits Convention Center in New York from Jan. 16-18. The show put a focus on the tie-in between foodservice and technology.