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Thriving in today’s competitive restaurant landscape

As we enter a new decade, it’s easy to see that the restaurant industry continues to evolve. From technology like smart POS systems to food choices like plant-based meat substitutes, modernization defines the industry and its customers. Today’s diners want convenience, rewards for their loyalty and the ability to interact digitally with restaurants.

The National Restaurant Association predicts that intensified competition for customers will be the biggest challenge in the restaurant industry by 2030.1 Restaurants must stay on top of changing customer expectations to survive – and thrive. Below we outline three consumer preference trends you should consider as you work to stand out from the competition.

Convenience

As Generation Z grows up, their preferences influence the world at large. Diners born in this era don’t remember life before cell phones, and they’re used to adopting new technology as it becomes available. One such advancement includes new payment technology, an area where restaurants need to pay close attention.

Digital wallets
In the last two years, use of digital wallets and third-party payment services doubled. Forty-one percent of diners now expect to be able to pay using a digital wallet.2 If you’re not accepting these forms of payment today, make it a priority in 2020.

According to the Small Business Payments Spotlight, 65% of businesses feel digital wallet acceptance helps them provide a convenient checkout experience. And 43% say it helps speed up checkout.2 The lesson? Consumers increasingly want to use digital wallets, regardless of whether they’re dining at a neighborhood restaurant or a national chain. Restaurants can use the time saved from increased checkout speed to provide a more personalized experience. This means digital wallet acceptance is a win-win for both diners and restaurant owners.

Gift cards
Gift cards are another convenient payment method you should consider accepting. Consumers spend an average of $728 on gift giving annually, and gift cards account for $397 of that spend.3 You can use physical and digital gift cards as a tool to reach new customers and increase revenue. In fact, 41% of people who receive a gift card will visit a restaurant they wouldn’t have visited otherwise.3 And given that 36% of consumers are likely to purchase gift cards at a small business,2 offering this type of program is a no brainer.

Loyalty

Restaurants have a built-in advantage when it comes to developing customer loyalty. You meet and interact in person with your diners on a daily basis. But today, it takes more than a handshake and a friendly smile to solidify customer loyalty. You may need to go beyond your personal connections to reward your loyal customers.

A majority of diners appreciate a good small business loyalty program. Sixty-six percent say they will dine with you repeatedly if you offer a loyalty program.2 According to the Small Business Payments Spotlight, restauranteurs who’ve implemented loyalty programs have seen significant benefits:

  • 64% have seen improved customer loyalty
  • 52% have seen stronger relationships with customers
  • 50% have seen more consistent sales

Consider starting a loyalty program in 2020 so you get a bigger piece of diner spend and keep your customers coming back.

Digital technologies that enhance the diner experience

In today’s restaurant world, it’s all about the consumer experience—both in-store and online as more people dine away.4 If you aren’t providing the experience your diners expect with the technologies they’ve grown used to, you may be losing out.

Online
For many, the dining experience begins online. Twenty-four percent of diners will look up information about your restaurant online before engaging in person, and 29% will research your menu.2 So if you don’t have a website, you should invest some effort in 2020 to developing one. Whether you’re creating a new site or you already have one, ensure it contains the basic information diners look for, such as your hours of operation, address and menu.

Today’s diners also use the internet to research what others say about your restaurant. Sixty-five percent read online reviews to inform their dining choices. Half won’t dine with you if you have negative online reviews, and 30% of Generation Z only leave reviews after a bad experience.2 So monitor your online reviews and respond to them. This shows that you take feedback seriously – a trait that may ultimately help you build a positive reputation and a loyal customer base.

In person
You want your customers to leave your restaurant feeling well fed and well cared for. A smart restaurant POS system offers a number of features that can help ensure you deliver a smooth dining experience for everyone you serve. It can help with front-of-house functions, such as table management or taking phone orders. It can also help with back-of-house tasks such as inventory management and coordinating food preparation. Many smart POS systems include payroll functionality and can calculate your taxes. Reporting tools can provide real-time insight into the trends affecting your business. When the front-of-house and back-of-house run smoothly, you can spend more time ensuring diners are having the experience they expect.

Next steps

Consider how you operate your restaurant today. Do you provide the convenience your diners want? Do you offer loyalty programs to keep them coming back? Do you use automated tools to deliver a seamless experience? Does your POS system provide the functionality you need to manage your business? If you answered no to any of these questions, making a change may help you retain existing customers, gain new customers and reduce the time you spend on back-of-house functions.


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