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Advertising & Marketing

Investment into restaurant technology market must increase

Diners are opting for home delivery services and are increasingly using coupons and promotions, according to a new global survey of over 4,600 consumers conducted by AlixPartners.

As a result, investment into the restaurant technology market must increase to meet this growing demand, according to the business advisory firm. 

Highlights

•    Online ordering is regarded as the most important technological offering that a restaurant operator can have, according to 53% of diners questioned – ahead of digital menus (49%) and loyalty programs (48%) 

•    In the US, weekly use of meal delivery services doubled in the five years between 2010 and 2015. The UK delivery market is expected to treble by 2020; food ordering is growing at up to 20% per year in India, while takeaway grew by a fifth in Brazil last year

•    Diners are also demanding more healthy menus with over 90% saying this is ‘somewhat important’

•    However, spending on convenience and fast food meals is expected to decline over the next 12 months as diners plan to “trade up” and treat themselves at higher-end restaurants

•    Globally, 30% of meals are now eaten on-the-go. The prepared foods segment including pre-packaged salads and sandwiches is expected to grow by 3% through 2021[1]

Dr Tobais Plate, at AlixPartners said, “As home delivery services and eating-in grows in popularity, less is being spent on convenience and fast food meals. This has significant implications on restaurant operators and the way in which they manage their supply chain. Restaurant chains will need to keep up with the evolving technological needs of diners to ensure they stay ahead of more innovative competitors. That said, the quality and sustainability of food sources is continuing to grow in significance for diners.

“We’re seeing different organizational structures emerge to manage expansion, and handle procurement and supply chain effectiveness. Technology will continue to play a major role in the expectations of the modern diner; the real challenge will be for restaurant operators to keep up to speed with their customers’ needs to ultimately produce a higher quality offering with less.”

Additional survey findings include:

•    Quality of food critical – Consumers globally rank food quality (62%) as a key consideration when dining out, while over half of those surveyed want their food to be free of artificial ingredients and preservatives.

•    Healthy appetites on the rise – Over 90% of consumers consider healthy menu options as at least ‘somewhat important’ when deciding where to eat. Italian and Chinese diners are most likely to consider this ‘extremely’ or ‘very’ important, while those in the UK and Japan are least interested.

•    More meals on-the-go – Globally, 30% of meals are now eaten on-the-go. The prepared foods segment including pre-packaged salads and sandwiches is expected to grow by 3% through 2021.[2]

•    Rise of cheap deals – Diners plan to reduce spend by eating at less expensive restaurants (35%) and utilizing coupons, promotions and other discounts (34%) in the coming year: more than 70% of them say so in China and Brazil.

•    Decline in number of visits – Customers in the U.S. and South Korea are most interested in cutting back on the number of visits.

•    Global chains, local markets – Global restaurants are gaining traction in local marketplaces worldwide, partly because they are able to get some key elements right. They are able to adapt and localize their menus. For example, Domino’s in India tailored its offering to suit local tastes by delivering to trains as well as offering vegetarian options. Higher customer expectations will put more pressure on supply chains and global partners to ensure they deliver the brand consistently. 

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