PYMNTS Intelligence: How Digital Ordering Demands Are Changing the Face of the Restaurant Industry

It is no secret that accelerated digital transformation in the pandemic’s wake has changed consumer preferences. As people have become more accustomed to interacting with others digitally, quick-service restaurants (QSRs) and restaurants have noted major shifts in the ways customers want to order and receive their food. Now that consumers have acquired a taste for digital ordering—its convenience, time savings, variety and simplicity—it appears they have no intention of turning back to the analog versions of engaging with restaurants.

Recent PYMNTS research found that compared to 2019, 36% of customers are using mobile applications to order ahead more often, 32% are ordering from restaurant websites more often, 32% place a pickup order by phone more often and 28% are using food delivery aggregators, such as Grubhub and DoorDash, more often. Aggregator usage shows demographic patterns too, with millennials making up 34% of all aggregator users. Those who use more than one aggregator are also most likely to be millennials and consumers with incomes higher than $100,000 per year.

The increase in digital ordering volume and the demand for faster service have shaken restaurant operations to their core, leaving many QSRs and restaurants to wonder what will be next in the evolution to maintain customer happiness and loyalty. This month, PYMNTS Intelligence examines how customers’ digital ordering demands are reshaping the QSR and restaurant industry from the ground up.

The Problem Is Scale

During the pandemic’s height, restaurants placed a strong emphasis on bolstering their digital storefronts, enabling more digital-first and contactless ordering capabilities. Faster and more convenient food ordering systems, however, are pushing restaurants’ operational capabilities to their limits as labor shortages persist. Now QSRs must rethink their strategies to keep pace with customers’ growing demands by optimizing efficiency.

Customer preference data tells one very distinct tale: There is a significant downturn in indoor dining at QSRs and restaurants due to an increase in off-premises dining preferences. Specifically, the call is high for drive-thru options, which 37% of patrons identify as their preferred method for ordering.

Part of the reason for this shift in preferences is that 30% of Americans still do not feel comfortable dining indoors. The other factor is the speed and convenience consumers experience with other means of acquiring food. More than half of consumers use a digital app to order restaurant food for off-premises dining. Even when at a physical restaurant location, 64% prefer to order their food digitally to go, as opposed to speaking with waitstaff.

PYMNTS’ research indicates that features such as time-saving ordering capabilities, convenient order pickup options and payment-related digital features are major determinants of whether a consumer will select a restaurant or not. Additionally, food pickup and ordering options are important components of long-term customer allegiance, with 34% of restaurant goers saying that pickup and ordering improvements will augment their loyalty.

How QSRs Are Solving the Demand Problem

The massive increase in digital ordering demand, combined with the decline in desire for indoor dining, means that the path forward for QSRs is all about restaurant design.

To protect themselves operationally, restaurants are looking to cut back on the interior real estate of their establishments while modernizing their kitchens and adding more outdoor capabilities, such as walk-up ordering windows. Fifty-five percent of restaurant operators in a recent survey said they planned to add more space for pickup orders, while 45% are planning to add more drive-thru locations and lanes to keep up with the influx of order-ahead and to-go orders. Forty-three percent of restaurant operators are also looking to add outdoor dining space for customers who still want to eat at a physical location but are timid about eating inside.

In addition to creating more drive-thru space, restaurants are toying with implementing advanced technologies within drive-thrus to optimize the experience. Four out of five consumers, for example, say they would order from an automated voice system or a kiosk while in a drive-thru lane versus speaking to waitstaff.

Another way in which restaurants are preparing themselves to meet the challenge of increased orders through aggregators is by expanding their virtual restaurants’ footprints. Forty-one percent of independent restaurants currently operate ghost kitchens to accommodate consumer delivery requests. Of those operators, 46% report not only that their virtual restaurants are permanent additions but also that they plan to open three or more in the next year.

The future for restaurant design is still evolving, but innovators in the space are always looking ahead to what is next. The signs are clear for what needs to be done now to accommodate off-premises ordering expectations, but the means of delivering efficiency are changing too. Restaurants are already considering how to expand carryout food delivery by way of drone or driverless car, an idea that has seen an increase in consumer interest of 10% year over year. As food ordering demand drives innovation, the restaurant industry will continue to break new ground to keep customers satisfied.