News Briefs

Restaurant dining has returned to pre-pandemic levels, and the future of the industry will be shaped by consumer demand for convenience and frictionless digital experiences. This is according to Deloitte’s new survey, “The Future of Restaurants: The New Normal and Beyond."

Deloitte leveraged its Future of the Consumer Industry analysis to examine implications brought on by forces changing the industry across markets, models, and mechanics in the restaurant sector. This analysis, coupled with the results of a survey of 750 respondents fielded in March 2023 who had ordered from a restaurant within the last three months, formed the basis of this paper.

Key takeaways from Deloitte’s Future of Restaurants Survey

• Restaurant dining rebounds as more than half of consumers (55%) say they are dining in restaurants as much or more than before the pandemic.
• More than one-third (37%) of dine-in guests and 40% of takeout guests want less expensive options alongside promotions and discounts.
• When placing a delivery or takeout order, 40% of customers prefer to do so directly through a restaurant’s app or website, compared to 13% who prefer third-party apps or websites.
• Consumers age 18-38 are more likely to return to restaurants that use automation technologies than those age 39+, signaling that these technologies are likely to continue to be adopted over time.

Why this matters

More than three years after the pandemic turned the restaurant industry upside down, many dining preferences that emerged during that time seem to be here to stay. In its new report, “The Future of Restaurants: The New Normal and Beyond,” Deloitte leveraged its Future of the Consumer Industry analysis to examine implications brought on by forces changing the industry across markets, models, and mechanics in the restaurant sector. This analysis, coupled with the results of a survey of 750 respondents fielded in March 2023 who had ordered from a restaurant within the last three months, formed the basis of this paper.

Markets: Diners crave value from the restaurant experience

While consumers continue to have an appetite for the restaurant experience, financial concerns are driving even greater demand for high-quality food at reasonable prices. To address the market demand for value amid shifting needs and preferences, restaurants should tailor targeted discount and marketing campaigns, diversified offerings, and channel-specific offerings to drive growth.

• Despite concerns that restaurants might not recover from the pandemic, more than half of consumers (55%) reported they dined in restaurants with equal or greater frequency than before the disruption.
• A surprising 69% of consumers ordered food for takeout or delivery at the same rate or more frequently than pre-pandemic.
• As an incentive to order from restaurants more frequently, 37% of dine-in guests and 40% of takeout guests want less expensive options alongside promotions and discounts. Higher quality products are less of a driver than value, resonating with only 19% of dine-in guests and 15% of takeout guests.

Key quote

“The restaurant industry is emerging from the pandemic with a menu full of opportunities to serve its customers, both in the dining room and off-premise. With large-scale changes on the horizon, driven by advanced technologies and ongoing shifts in consumer demands and preferences, we can expect restaurants to look dramatically different in 10 years. As a result, restaurants should consider implementing various offerings that enable consumers to maximize the dining experience and set up their operations for long-term growth.”

• Jean Chick, principal, Deloitte Consulting LLP, and U.S. restaurant and food service leader

Models: Delivery and takeout take over

The rise of third-party delivery apps drove a surge in off-premise dining over the last 10 years, a trend in the restaurant sector that intensified during the pandemic. Restaurants are increasingly catering to the demand for delivery and takeout by dedicating space on-premise for pickup orders and separate lines for takeout orders, ultimately reducing the need for dining room space. As a result, customers are likely to patronize restaurants that enable a more frictionless digital experience to place and manage their delivery and takeout orders.

• While 13% of customers use third-party apps or websites to place a delivery or takeout order, 40% of customers prefer to order through the restaurant’s app or website, demonstrating the importance of a restaurant owning its own digital experience.
• Regardless of how an order is placed, most customers (87%) believe a delivery fee of $5 or less is fair for the convenience it brings.
• As ghost kitchens, which only offer takeout and delivery, continue to become more prevalent, more than half of consumers (52%) indicated they would order from such an establishment.
• Quality counts: 60% of consumers said they are unlikely to accept lesser quality when ordering takeout food.
• Most patrons prefer to use the phone to address complaints, however its use has declined, from 63% in 2021 to 55% in 2023. During the same time period, customer preference for mobile chat and text increased from 20% to 27%.

Mechanics: Consumers have an appetite for advanced technology

Amid shifting customer preferences and economic conditions, advanced technologies are expected to shape the mechanics of restaurant operations and staffing over the next 10 years. According to the study, most guests are not deterred by automation and other emerging technologies and would continue to patronize restaurants that leverage such innovations.

• Consumers aged 18-38 are 16 percentage points more likely to return to restaurants that use automation technologies than those 39 years and over (58% for 18-38 group versus 42% for 39+ group). This indicates these technologies are likely to continue to be adopted over time.
• Contactless delivery has maintained prominence since the pandemic, enabling faster deliveries: 53% of respondents receive contactless delivery more than half the time.
• Nearly half (47%) of customers would order from a restaurant that offers delivery via drones and driverless vehicles, up from 44% in 2021.
• A majority of consumers said they are at least somewhat likely to use voice automated ordering systems, including 79% for drive-thru, 74% for phone systems, and 70% for dine-in.
• Acceptance of kitchen automation is on the rise: 60% of consumers noted they are somewhat likely to order from a kitchen that prepares food, at least in part, through robotic technologies, up from 54% in 2021.
• Although only 19% of those surveyed had experience with a cashier-less restaurant, 62% said they would be somewhat likely to order from one if given the opportunity.

For electric vehicle owners in British Columbia, Tim Hortons is now fueling road trips in more ways than one.  The company has announced the expansion of its electric vehicle charging station pilot launched earlier this year in Oakville, Ontario, by unveiling six new charging stations at restaurants throughout  British Columbia.

Tim Hortons announced the pilot in February in an effort to study the technology, its usage and opportunities.

"We have been thrilled with the results of the pilot so far.  Usage of the charging station in Oakville has surpassed our expectations and we received many calls with requests to expand the pilot," said Paulo Ferreira, Senior Director, International Strategic Restaurant Design and Building Standards, Tim Hortons. "With more than 3,300 eligible restaurants across the country, we continue to look for opportunities to expand the pilot and contribute to the EV infrastructure."

The BC expansion, supported by the Province of BC's Community Charging Infrastructure Fund and Koben Systems Inc. (KSI), placed charging stations strategically in Nanaimo, Langford, North Vancouver, Burnaby, Abbotsford and Coquitlam to create paths within the province, allowing guests to travel from restaurant to restaurant strictly on electric power.

Tim Hortons offers charging stations as a courtesy to guests at six locations.  As of March 31st, 2013, Tim Hortons had 4,288 system-wide restaurants, including 3,453 in Canada, 808 in the United States and 27 in the Gulf Cooperation Council. 

“This partnership with APS reinforces our commitment to leverage technology to optimize our operations and assist in creating unforgettable experiences for our guests,” said Ramki Srinivasan, Chief Digital & Information Officer at Great Wolf Resorts. “We continuously explore ways to further enhance the guest experience, and believe the use of cutting-edge technology is a key lever to help us deliver an exceptional experience at our resorts. We are excited about the technological advances and opportunities this collaboration with APS will bring."

FreedomPay, a global leader in Next Level Commerce™, announces a partnership with Visa to integrate Visa’s network tokenization capabilities within FreedomPay’s global identity and tokenization framework. The true omnichannel global tokenization product will provide network tokens across card brands, helping to keep merchants compliant with cross-border and in-region data and privacy regulations, while helping merchants qualify for lower interchange rates for certain Visa network tokenized transactions.

“With the growing number of connected devices, changing consumer behaviors and shifting privacy regulations, the benefits of utilizing network tokens are many. Using the Visa Acceptance Platform, Visa has the scale and flexibility to seamlessly provision them for FreedomPay’s clients around the globe, helping to improve customer experience, improve authorization rates and reduce fraud,” said Bill Dobbins, SVP, Head of Acquiring and Enablement at Visa.

Network tokenization will also help streamline the customer journey, providing a seamless experience across borders and merchant locations. The new capabilities will be integrated into FreedomPay’s larger identity suite, offering a 360-degree view of the customer to the merchant, creating a more personalized checkout experience through data-driven loyalty and incentives.

“FreedomPay is trusted by the largest brands across hospitality, retail, F&B and more to provide repeatable and scalable next level solutions for security, data management and compliance, and to create a personalized and seamless customer journey around the globe,” said David Knowlton, CTO at FreedomPay. “By partnering with Visa for network tokenization, FreedomPay will provide merchants with more flexibility and geographic coverage, including in harder-to-access regions, when managing customer and card data.”

Additional features will also be supported without any changes to the merchant’s systems such as supporting card on file use cases with digital wallet taps as well as token life cycle management.

For the first time hospitality’s newest technology category – the Property Experience Management Solution (PXMS) – will be on display at HITEC Toronto, to be held June 26 to 29 at the Metro Toronto Convention Center. Developed by UrVenue, UV Enterprise is a full-stack technology platform that drives commerce, manages operations, and enhances the guest experience through unified booking and itinerary management for non-room, experience-based inventory.

An iconic, world-renowned hotel will be revealed as the first to pilot the full suite of UrVenue’s PXMS capabilities, including its NEW feature enhancements, during a Press Conference on June 27 at 10:15 a.m. in Booth 2401.

“A unified system for commerce and operations robust enough for an entire property’s experiences had been lacking in the industry until we launched UV Enterprise,” said Deron Pearson, CEO of UrVenue.   “With our newest solutions within UV Enterprise, which we will reveal at HITEC, we are connecting the guest booking journey and elevating the guest experience to unprecedented levels.  Modern travelers now have complete control over how to experience all of their hotel’s offerings outside of the guest room (pools, lounges, recreational activities, restaurants, and more).”

The enhancements debuting at HITEC Toronto were developed after two years of in-depth market and customer research and in conjunction with the hotel to be announced at the show. The enhancements strengthen the pre-arrival and on-property guest experience, while providing a seamless digital booking process and driving revenue opportunities. UrVenue looks forward to introducing hotel operators and industry leaders to this innovative technology at HITEC.

To pre-schedule a meeting with UrVenue at HITEC Toronto, click here. For more information on the UV Enterprise PXMS, visit www.urvenue.com.

Maestro PMS is making hotel payments easier than ever, thanks to the recent integration with b4’s online payment platform, TransForm. TransForm helps hotels fight fraud and win more chargebacks by ensuring raw credit card data stays hidden from everyone except the cardholder. By passing encrypted credit card data directly into the correct Maestro PMS ledger, hoteliers and their customers benefit from a process that is both more efficient and more secure.

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“Hoteliers should always be looking for new ways to prevent fraud and mitigate losses,” said Steve Miles, COO at b4. “Paper-based credit-card forms are prone to human error and not PCI compliant. The TransForm and Maestro integration eliminates manual data entry, immediately lowering the risk of chargeback disputes. It also streamlines check-in and helps prevent front desk staff from unknowingly accepting fraudulent payments.”

As the need to take card-not-present payments and authorizations continues to grow, various methods of credit card submission evolved. Some cards were collected over the phone and manually keyed in or written on paper. Some required forms to be faxed or emailed with card details in full sight. None of these collection methods are PCI compliant, as they put credit card details in plain view. This leaves the hotel at a higher risk for fraud and in a weaker position during chargeback disputes.

“Guests expect secure and convenient technology when planning a trip,” said Warren Dehan, President of Maestro. “If you don’t enable customers to pay online with confidence that their credit card information is fully protected, they may decide to stay elsewhere. We partnered withb4 to reduce the risk associated with payment processing. When hotels implement best practices and PCI-compliant methods such as TransForm provides, there is a positive impact on the bottom line.”

Additional benefits of this integration include:

• Time saved for hotel staff responsible for billing reconciliation
• Reduced errors through the elimination of re-keying card details from paper forms and emails
• Having a card securely on file enables hotel staff to post additional charges or incidentals
• More transactions attributed to an account give the hotel team more guest data for service personalization and enable more targeted packaging and promotional decisions

“Since adopting TransForm from b4, our hotel’s payment processing has gone from labor-intensive to hands-off, set-it-and-forget-it,” said Nattika Wattanasuttiwong, Director of Operations at the Madison Concourse Hotel and Governor’s Club in Madison, Wis. “This technology has been invaluable for maintaining success despite rising operations and labor costs, something Maestro readily acknowledges through its new integrations. In fact, we discovered TransForm during Maestro’s 2022 User Conference and signed with b4 shortly after. This adaptability to new technology, combined with Maestro’s excellent support team, has helped us improve operations where it matters most.”

“Maestro’s integration to TransForm represents a sizeable shift for online payments by minimizing costs associated with chargebacks and lowering credit card processing fees,” says Dehan. “Through the use of recommended best practices and our joint technology, we will greatly reduce the problems surrounding chargebacks for our hoteliers.”

For a hands-on look at the Maestro PMS / b4 integration, visit b4 in Booth 1232 or Maestro PMS in Booth 1225 at HITEC Toronto, June 27 to 29 at the Metro Toronto Convention Center – South Building.