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Restaurant Payment Tech: Set to Explode

Not long ago, neither restaurant operators nor their customers seemed willing to use payment technology systems for check settlement. How times have changed, at least for customers (and probably for restaurateurs as well). A new study from the Cornell Center for Hospitality Research has found that U.S. restaurant customers seem ready to forge ahead with technology-based check settlement. The study compared the ratings of nearly 1,300 consumers on how they felt about paying their restaurant bill using a smartphone, a dedicated table-top system, or the traditional system of handing over a credit card. The survey rated those three settlement methods according to eight measurements—and technology won on all eight of them.

You can read the study at no charge from the Cornell Center for Hospitality Research: “Ready and Willing: Restaurant Customers’ View of Payment Technology,” by Sheryl Kimes and Joel Collier. Kimes is a professor at Cornell University and Collier is on the faculty of Mississippi State University.

Restaurants jump into mobile payment arena
Kimes and Collier conducted their study before Apple Pay was announced, but some restaurant firms had already rolled out some manner of electronic payment system. That includes Chili’s, with its table-top system, and OpenTable, with its Chalo mobile payment system. In general, though, payment technology seems mostly to be in the future for most restaurants, as Kimes and Collier’s recent survey of restaurant operators found that only about one-eighth of the restaurants they consulted had installed some kind of electronic payment system. That seems due to change though as about half of the operators said they were considering moving ahead with a technology-based payment system.

The eight measurements in this study are accuracy, control of pacing, convenience, efficiency, experience quality, future spending intentions, privacy, and satisfaction with the payment method. Although technology scored significantly higher than the traditional system on every measure, two of them particularly stand out—privacy and future spending intentions.

Privacy has become an increasing concern for customers in restaurants and retail, given media reports of stolen credit card numbers. The survey respondents thought that technology gave them more privacy (or credit card security) because they never hand over their card.

Particularly intriguing is the finding that respondents said that they would be likely to spend more at a restaurant with payment technology. It will take more research to see why that might be the case.

A matter of preference and dining style?
Kimes and Collier’s study specifically applies to U.S. consumers in casual restaurants, but it appears that restaurant operators in most segments no longer need to be concerned about whether guests will support the use of payment technologies. The researchers point out, however, that we don’t yet know whether customer payment technology will be accepted in fine-dining restaurants. Furthermore, they suggest that restaurants should always give guests the choice of which method they use to pay their check, since studies have shown that customer satisfaction drops when people are forced to use a particular technology.

That said, given increasing privacy concerns, it’s likely that guests will greatly appreciate the control and privacy that they gain by being able to use payment technologies. And it seems clear from this study that adding technology to the settlement process will improve satisfaction for many customers. In short, the consumers are ready, and it looks like the time has come for the restaurant industry to move ahead with customer-driven payment technology.
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