This week in restaurants, Nathan’s Famous taps ghost kitchens, and USHG launches new loyalty apps.
Quick-service restaurant (QSR) chain Nathan’s Famous announced Wednesday (April 19) a partnership with virtual restaurant company Nextbite to enable other restaurants to prepare the brand’s foods from their kitchens, selling them for delivery online.
“We think Nextbite is a great partner to bring our world-famous Nathan’s hot dogs, fresh burgers, and crinkle cut fries to Nathan’s fans all over via delivery, as we have a solid track record with our virtual partners,” Phil McCann, Nathan’s vice president of marketing said in a statement. “The Nextbite team clearly has the expertise to bring our concept on a national scale by working with restaurants nationwide.”
Certainly, this is not Nathan’s Famous’s first foray into the ghost kitchen space. In 2021, the brand was opening virtual locations by the hundreds, and later that year, the company began working with ghost kitchen solution provider Franklin Junction to help its digital expansion. No word on where that partnership stands now, but as recently as last fall, the two companies were opening dozens of new locations.
Overall, delivery orders make up a relatively small portion of all restaurant sales, but that share is growing. PYMNTS’ study “Connected Dining: Rising Costs Push Consumers Toward Pickup,” which draws from a January survey of more than 2,100 U.S. consumers, finds that 10% of consumers reported having ordered their last restaurant meal for delivery, up significantly from 7% just the month before.
Overall, a significant share of restaurant customers places orders online at least some of the time. Findings from “Connected Dining: Third-Party Restaurant Aggregators Keep the Young and Affluent Engaged,” a new PYMNTS-exclusive report based on a March survey of nearly 2,300 United States consumers, reveals that 40% report having used a third-party food aggregator in the past six months.
Plus, three-quarters of those surveyed report believing that aggregators save them time when they do not have time to prepare meals for themselves, and a similar share states that aggregators give them control over where, when and how to eat.
In an interview with PYMNTS’ Karen Webster last year, Nexbite CEO Alex Canter explained that ghost kitchens enable restaurants to seize on this delivery demand to boost off-hour sales at would-be slow times.
“We’ve really wanted to help these restaurants to maximize their underutilized kitchens, ’cause every restaurant has these opportunities to sell more food if they had that demand to do so,” Canter said.
Shake Shack founder Danny Meyer’s Union Square Hospitality Group, which owns a range of restaurant brands ranging from fine dining to fast-casual, is now working with loyalty platform Thanx to create digital ordering and rewards programs for its Daily Provisions, Blue Smoke and Marta brands, according to FSR.
“At USHG, we’re always searching for technology that enhances the hospitality experience,” said Kelly MacPherson, the restaurant group’s chief technology officer. “With Thanx, we’re able to find creative ways to reward and build brand loyalty, meet our guests where they are, and create raves.”
The goal of these programs is not only to drive visit frequency but also to gather customer data and to encourage digital engagement by removing friction from the process.
Certainly, there is significant demand for rewards programs, with the majority of consumers now using them in at least one restaurant. Research from “Connected Dining: Consumers Like the Taste of Discount Meals,” a PYMNTS report based on a survey of more than 1,800 U.S. consumers in February, reveals that 51% of restaurant patrons used restaurants’ loyalty programs in January.
As restaurant technology firms look for ways to stand out in the crowded space, some are specializing to meet the needs of specific subsectors. For instance, Odeko, a company that provides supply chain management and operations software for cafés and coffee shops, announced Tuesday (April 18) the raise of $53 million in its Series D round.
“Our customers face countless operational and environmental challenges every day, and our goal is to ease their burden so that they can focus their time and resources on building the parts of their business they love, while serving their neighborhoods and communities,” CEO Dane Atkinson said in a statement. “This capital allows us to do just that, and we are grateful to our investors for their continued support.”
The company follows in the mold of other ResTech companies looking to target specific kinds of eateries, such as Slice, which offers solutions for independent pizzerias, and HungryPanda, an aggregator that focuses on Chinese restaurants and on meeting the needs of Chinese consumers living abroad.
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