There has been a seismic transformation in the restaurant industry over the past decade, driven by a number of trends. Consumers are more educated about food and dining options today – and much more demanding when it comes to experiences and expectations for convenience, variety, and more. Changing tastes and preferences have put the focus on non-meat alternatives and other health-conscious diets. Consequently, restaurants are offering expanded menus, with more sustainable options and healthy food choices. And we’re seeing the growth of new and shifting categories like “fine-casual” and “flex-casual.”
To keep up with this transformation, restaurants need to deliver a superior experience in every aspect, from food quality and menu choices to online ordering options. On top of these cultural changes and shifting consumer priorities, the landscape has changed even more when it comes to restaurant marketing, with the advent and evolution of digital marketing tools and technologies.
Digital Marketing Disruption
Digital has upended virtually every industry in many ways; but few have been as drastically impacted as the restaurant vertical. Traditional ways of reaching customers and building loyalty have changed, due to a number of forces and factors including:
The Evolution of Ordering: The way we get our food has changed. In addition to walking into a restaurant for sit-down or take-out dining, we now have the option of online and app ordering (and reservations), third-party food delivery apps and services, curbside pickup, and digital table-side ordering. Restaurant marketers need to reach consumers wherever they are, across multiple channels and devices. Location-based technology can play a big role here.
The Internet & Social Media: How we interact around food and dining has changed dramatically with the rise of online technology. Every meal is now an Instagram-able photo opp, chefs have become celebrities and TV stars, and food bloggers and influencers can be found everywhere.
Incentives & Reviews: Where we dine is influenced by an increasing number of factors including restaurant loyalty apps and rewards/points programs, push notifications, and social media/online reviews and sharing.
That’s a lot of change – and a lot for marketers to juggle when planning campaigns for restaurants. But as overwhelming or stressful as this may be for a restaurant marketer, the changing dining and digital landscapes also present a massive and exciting opportunity. For one thing, restaurant spending is up, with Americans spending more than ever. While boomers and Gen Xers currently spend the most on food and beverage, millennials are poised to become the biggest spenders at groceries and restaurants within 10 years, as they enter their peak earning years. And there’s more good news for marketers.
Mobile & Apps Are Driving Sales
Consumers globally ordered meals on mobile 130 percent more in 2018 than in 2016, and global downloads of the top five delivery apps grew 115 percent during the same period, according to research from App Annie. The NPD Group predicts that restaurant digital orders will triple in volume by the end of 2020, with mobile leading the way.
Consumers Want to Engage with Restaurants
When asked what types of companies they’re interested in receiving personalized messages from, more U.S. internet users (52 percent) chose restaurants and bars. Similarly, when asked what types of loyalty programs they’re subscribed to, U.S. internet users placed restaurants high on the list, just after retail, supermarkets, and pharmacies. Millennials in particular site loyalty programs as a strong purchasing influence. Consequently, loyalty apps are on the rise.
Digital Orders, Delivery & Take-Out: A Powerful Trifecta
According to research from The NPD Group, nearly half of dinners purchased from a restaurant are now eaten at home, up from 47 percent in 2012. U.S. restaurant delivery sales will rise an average of 12 percent per year to $76 billion in 2022, up 77 percent from 2017’s $43 billion, according to a Cowen and Company report published last year. And digital orders have more than doubled between 2013 and this year, from 926 million to 2.3 billion, according to the same report. There’s a payoff in investing in digital dining experiences: restaurants can see roughly a 20 percent increase in average guest spend, with bigger gains coming from millennials.
Restaurants are responding to these opportunities in innovative ways. Here are a few examples we’ve seen from some of our Selligent clients:
Chronodrive delivers a new concept in online shopping. This French food distribution company allows customers to place their orders online and designate a time to pick it up in person at one of their drive-through locations. When they arrive, an on-site delivery person brings the order right to their car for quick pick-up. Chronodrive used Selligent Marketing Cloud to drive repeat business, by setting up and executing a successful email campaign where customers were sent a specific number of messages for a set period of time, to remind them to place and pick up their orders. Customers were incented to order again with special coupons and offers delivered through Selligent.
Sligro centralizes data and delivers personalized communications. This European food service brand opened a new venue for culinary events, attracting over 15,000 visitors and 1,000 customers in its first year. Sligro uses the Selligent platform to centralize data, deliver personalized communications, and achieve seamless event management. Restaurants can follow a similar path, using personalized, automated emails to alert customers to current and upcoming activities of interest, from new restaurant locations, to new menu specials, seasonal menu changes, different night of the week specials, or to let customers know when their favorite product is back on the menu. (Download and read the full Sligro case study here.)
Customers expect an impeccable, personalized experience, not just whenever they dine with you, but every time they interact with your restaurant, across different channels and devices. Restaurant marketers need to creatively strategize how they can remain responsive to changes in consumer demands and the industry at large, while improving their marketing and collecting analytics for continual improvement. Critical to the success of any restaurant marketing strategy are these key components:
- Omnichannel marketing
- Use of Data and AI
At Selligent, we serve some of the largest restaurants and food retailers in the world, helping them apply digital marketing practices to more effectively reach and satisfy their customers. Our omnichannel platform can help restaurateurs maximize every moment with customers, by streamlining marketing communications and merging consumer behavioral data with channel preferences. The result? Authentic, compelling, and highly personalized experiences that help retain customers, driving engagement and loyalty.