Challenges and opportunities that traditional offline restaurants face
According to Statista, the revenue of online food delivery would reach US$122,739m in 2020 and seem to grow at an annual rate of 7.5% in the following four years. The world is changing rapidly, and the food delivery is leading the race of the on-demanding world. Under this circumstance, what challenges are traditional offline restaurants facing? How about opportunities? How can they seize opportunities to improve their own competitiveness?
The first challenge traditional offline restaurant face is their inconvenience. More and more people think ordering online is more convenient and user-friendly than traditional eating out because orders can be easily selected through a mobile app or a website and get delivered in a short period of time. My roommate and I did a test last weekend. It took us 15 minutes to prepare for going out, 20 minutes to arrive at the restaurant, 10 minutes to wait for a seat and 30 minutes to get all our dishes while it just need simple click and took around 35 minutes in total when ordering online. It is a genral case that we would waste more time and energy eating out than ordering online.
However, there may be many methods offline restaurants can take to solve this problem and improve their competitiveness. One of them is developing an application to make ordering more convenient and improve user experiences. Through this application, people can not only see the menu in advance and make a reservation, but also do a pre-ordering. This allows the restaurant arrange time and ingredient needed in advance which could shorten customers’ waiting time. Also, in the application, people can find recommendations and reviews from other customers visited the restaurant before which helps people make better choices in a shorter period of time.
Some offline restaurants, which have set up an outstanding image brand can smoothly enter the food delivery and takeaway market. Also, they can explore and develop some semi-finished products, self-heating food and other ready-to-eat products and sell them through e-commerce channels to achieve online retail catering. Taking Di Bruno Bros. as an example, apart from offline shops located in many cities, it provides online shops for gourmet, specialty cheese, Italian meats, Philly gift baskets and so on. Scott said,
“The company’s appetizing homepage features full-screen rotating banners and excellent photography to encourage shoppers to click-through to products and services.”
Social media marketing is a good way for running a modern business if restaurants think that it is costly to develop and maintain an application or a website for online shops and delivery service. One of strategies is to hold contests on social media like Instagram as many brands did before and set prize as some promotion codes only when eating in the restaurant that they can be applied. Moreover, some other promotion activities can be hold like people can get a percentage of discount if they take pictures of environment of the restaurant and share the pictures with friends or through social media getting 20 “like”. All these measures allow restaurant win at prize when they are less competitive in convenience, and they are also a way of free advertising.
Another challenge traditional restaurant may face is the bottleneck to improve their services and find the real customer demands. There will be some people who prefer to visit the restaurant and experience the service. How to catch these customers is challenging for restaurants. Also, the world is changing rapidly. To cope with that, restaurants also need to make some changes according to customer demands.
One way to improve the service in the restaurant is to regard a customer’s complaint as a pot of gold. In fact, over 90% of unsatisfied customers will not actually complain directly — so it is really hard for restaurants to find out what their problem is let alone to make improvement. However, using an online questionnaire tool may be helpful. Staff in the restaurant can set some questions about customers’ opinion on restaurant service and customer demands using one of good tools and save it as a link or a QR code where customers can scan. Those customers who take the survey and give some constructive suggestions could get small gifts or a small percentage of discount.
Taking advantages of user data and the technology of machine learning, restaurants could better find user likes and give recommendation based on that. This can be achieved by first developing an application which allow users log in using an account and order online, then creating a recommendation module on the application. Many machine learning algorithms and models can be used. Every order user make will be stored and input into a model. The result is the unique recommendation for users based on what they have ordered before. If the model is accurate, customers will be surprised that this restaurant can “understand” their preference and needs.
Nowadays, technology innovation is leading the development of the catering industry. We can see this trend from takeaway, delivery to using high-tech to replace labor, including intelligent systems to replace waiters and cashiers, welcome robots, smart cooking machines, face payment, and even unmanned restaurants. It is an opportunity for offline restaurants to subvert traditional way of managing in order to appeal those people who want to experience new technology.
Following KFC, many smart restaurants in catering companies have made their debut in China. The Chinese old-fashioned Wufangzhai teamed up with Alibaba Group to create its first “unmanned smart restaurant” in Hangzhou. The “smart store” jointly created by Zhouheiya which is a famous brand in China aimed at providing processed food of ducks and WeChat appeared in Shenzhen. Customers brush their faces to enter the door and use face payment. JD’s first “Future Restaurant” was unveiled in Tianjin, providing robotic services. It is expected that in the next few years, intelligent technology will penetrate the catering industry in a large area, which will affect the entire catering industry.
