The restaurant industry faces a pivotal opportunity with the rise of frictionless digital payments, responding to growing customer demand for convenience. Despite these advancements, adoption rates lag due to entrenched use of traditional payment methods and ongoing staffing challenges.
PYMNTS Intelligence’s new study, “Why More Restaurants Need to Bite Into Digital Transformation,” delves into consumers embracing technologies like digital wallets, mobile apps and QR codes because they not only meets the preferences of tech-savvy diners, but also enhance operational efficiency and empower staff to elevate the overall dining experience.
To stay competitive in this digital-first era, restaurants must integrate these modern payment solutions to ensure seamless dining experiences and avoid falling behind more innovative competitors.
In today’s dining landscape, the push toward adopting frictionless digital payments represents a pivotal opportunity for restaurants, backed by compelling statistics and industry insights.
Restaurants that integrate digital wallets, mobile apps and QR codes meet rising customer demand for contactless payments, enhancing satisfaction while streamlining operations and minimizing errors. This integration also liberates staff to focus on enhancing the overall dining experience, ensuring smoother service and greater efficiency.
Customer preference for contactless payments is robust in both limited-service and full-service restaurants in the U.S. A National Restaurant Association study shows 68% of patrons at limited-service venues favor contactless or mobile options, including 65% for smartphone apps, 63% for self-service kiosks, 61% for digital wallets, and 48% for QR codes.
Similarly, 62% of diners at full-service establishments prefer contactless payments, with 57% favoring digital wallets, 55% smartphone apps and 46% QR codes. Square’s survey noted a 7% year-over-year rise in diners preferring contactless methods, with digital wallet usage up by 42% and adoption of contactless payment kiosks by 15%, highlighting the rapid adoption of modern payment technologies.
Advanced POS systems that unify in-store and digital orders benefit restaurants by enhancing operational efficiency and customer loyalty through robust analytics. Currently, only 38% of restaurants in the U.S. and Canada have integrated these systems, but they cite efficient order processing as a key advantage.
In the fast casual and quick-service restaurant segment, 65% prioritize adopting unified POS platforms to optimize service and menu offerings using detailed analytics. Despite an 11% increase in off-premises and digital sales, broader adoption of integrated POS solutions is needed to meet rising consumer preferences.
Investment in contactless payment solutions remains moderate, with 41% of full-service and 42% of limited-service restaurants planning investments in 2024, citing concerns over costs, integration and ROI.
Despite the advantages of advanced POS systems, there is room for broader adoption. Restaurant off-premises and digital sales have seen an 11% increase from 2022, underscoring the growing importance of integrated POS solutions in meeting evolving consumer preferences.
Amid a slow recovery in restaurant post-pandemic employment rates, technology and automation are increasingly crucial tools in addressing staffing shortages. As of May, restaurant employment has grown by less than 1% despite high demand. This ongoing staffing crunch is pushing restaurants to rely more on technology and automation, including for payment processing.
Among establishments using automation, 67% report direct benefits to diner experiences. Specifically, more than one-third of these establishments cite payment acceptance as a key area of impact. Implementing automated payment processing and digital ordering platforms not only enhances operational efficiency but also reduces cash handling, providing employees with quicker access to wages and tips. This approach significantly boosts staff retention and satisfaction in the face of ongoing labor challenges.
As the industry navigates these challenges, technological solutions are proving essential for maintaining service standards and meeting customer expectations.
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