If Q3 2019 quick-service restaurant (QSR) earnings are any indication, restaurants’ rush to digital and mobile ordering is benefiting many — but not all — restaurants. What’s the latest news in the quick-service world?
Dunkin’ just announced the addition of on-the-go mobile guest ordering. The new feature allows any customer — not just Perks members — to place a mobile order via the Dunkin’ app. The company processed more than 18 million on-the-go mobile orders in Q3, which is a 25 percent increase over the prior year.
Chipotle also announced good news, reporting that Q3 digital sales were up 87.9 percent year-over-year, accounting for 18.3 percent of sales in the period. The company attributed this success to testing drive-thrus for digital order pick-up in 20 locations. These “Chipotlanes” will roll out to more than 40 restaurants through 2020.
McDonald’s, on the other hand, missed Q3 earnings estimates. The chain has been growing its delivery program as well, as it looks to reach $4 billion in worldwide delivery sales this year. McDonald’s now has delivery partnerships with Grubhub, DoorDash and Uber Eats.
The latest Mobile Order-Ahead Tracker, PYMNTS explores the latest developments in the world of digital ordering, bolstered by an examination of the top performing QSRs.
Digital Ordering Trends
Last week, Chick-fil-A announced the launch of dine-in mobile ordering, allowing diners to order ahead before arriving to eat at one the fast-food chain’s locations. Customers can access dine-in mobile ordering through the Chick-fil-A app. After selecting “mobile order,” the dine-in option will be listed alongside the carry-out and drive-through options.
Mobile order-ahead was once solely the domain of QSRs and coffee chains, but now the playing field is getting crowded. Disney is offering mobile concession ordering at its amusement parks, several universities are introducing similar options at their on-campus dining halls and the services are gaining ground at sports venues, too.
In an interview with PYMNTS, Dustin Hemesath, co-founder and national sales manager of FanFood, explained how the company’s mobile app brings food ordering to venues with concession stands.
Consumer Interest
The share of consumers who are unwilling to wait longer than 10 minutes for food ordered via mobile app is 90 percent, and according to How We Will Pay 2019, any app is welcome that can save consumers time, especially by not making them wait in a line.
In the study, nearly three-fourths (72.7 percent) indicated interest in new ways of shopping. Why? First and foremost to save money (84.9 percent) but also to reduce frustration related to standing in lines (83.4 percent).
All of this jibes with FanFood’s Hemesath, who estimates that 40 percent of people last year abandoned their orders in the concession line.
According to the PYMNTS Commerce Connected Playbook, mobile usage in-car is already common, especially at QSRs: One quarter (25 percent) of drivers are already on their phones when pulling into drive-thru lanes.
Ordering food while driving is one of the most common connected activities per PYMNTS’ Digital Drive report. More than one-third (35.3 percent) of commuters had ordered food and picked it up at a drive-thru in the past week, while a slightly lower number (33.4 percent) had ordered and picked up coffee the same way.
Top Mobile Order-Ahead Providers
Companies included in PYMNTS’ Tracker Scorecard are the top restaurants providing mobile order-ahead as an integrated offering within their operations. Providers have been scored and ranked based on three primary mobile order-ahead criteria: ordering channels, loyalty integrations and app usage.
In the October edition of the Mobile Order-Ahead Tracker, top marks went to Starbucks with a score of 96 out of 100. Domino’s (94) and Chick-fil-A (90) rounded out the top three. McDonald’s ranked seventh with a score of 79, while Chipotle, coming on strong in Q3 2019, did not make the top 10 with a score of 44.
Examining Starbucks at No. 1, the mobile app allows users to order drinks and food in advance and pay for them via the app. Starbucks also has a wildly popular rewards program. In March, the company reported membership grew 14 percent year-over-year before, bringing the total to 16.3 million active members, who comprise roughly 40 percent of the coffee chain’s transactions.
The Domino’s Pizza app enables customers to order and pay in English and Spanish and earn rewards for purchasing. Domino’s has the multi-channel offerings down. It also connects with Ford Sync to track orders, and customers can place them on the go with Apple Watch or Pebble smartwatch. And iPhone users can also access a voice-ordering assistant.
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