LAS VEGAS -- Take a look at a Radio Shack flier from 1991--as did attendees of the "Right at Your Thumbtip: Mobile Ordering" education session at the 2014 NACS Show in Las Vegas--and you'll see a promo crammed with products that the smartphone has rendered far less important: cordless phones, computers, TVs, VCRs, fax machines, all of them considerably less crucial in our handheld world.
Thirty-seven percent of fast-casual restaurants offer digital ordering, and the first convenience store chains are beginning to follow suit. One mobile-ordering app provider, Olo founder and CEO Noah Glass, was joined on the stage by Rugwed Phatak of Giant Eagle, who uses Olo's app at its Market District grocery locations and has been testing it at a GetGo c-store.
It's set to launch mobile ordering at GetGo stores next summer.
"This is starting to become a cost of entry," said Phatak of mobile ordering, pointing to a growing subset of customers who expect this service from the restaurants they visit.
While any mobile-ordering service has its own services and setup, Olo's can work like this: When customers arrive at the store to pick up their food, they check in on the app, which triggers the kitchen to start the order if the user hasn't designated a set time. The user also chooses whether he or she plans to go in to get their food, use curbside pick up, or fill up their car with gas, in which case an employee would run the food right out to the pumps. Once the customer chooses a delivery method, a countdown clock starts on the users phone. This is when it can turn into a game, said Glass, with fun guarantees such as a free doughnut if the food isn't delivered in three minutes.
One of the most compelling results of the experience to date for Giant Eagle: It currently receives 35% higher rings for mobile ordering than in-store tickets. Why? Mobile ordering allows the user to compile their order at a slower pace, without the pressure of the queue behind them. They can also take the time to ask colleagues, roommates or family members if they want something too, increasing that price tag minute by minute.
The functions of mobile ordering fall into two buckets: consumer-facing properties and operational properties. For both, it's all about offering a clean and convenient experience for the user--be it a hurried and hungry customer or an employee trying to get through the lunch rush.
"It's really important that it's a seamless experience," said Phatak, who recommended looking at leading fast-casual restaurant chains Five Guys and Noodles & Co. for mobile-ordering inspiration.
The consumer benefits of mobile ordering also benefit the operator. The ability to customize an order gives operators an idea of the user's preferences so he or she can avoid sending promotional pushes around items he or she would never order. Users can also save favorite orders to speed up the process for next time, creating another bank of data for the operator to scrutinize.
A strong mobile ordering app also makes the user feel "like a VIP," said Glass, through saved favorites, queue-skipping and special offers. For the retailer, mobile ordering has the added benefit of giving the app a purpose. Engage consumers through mobile ordering capabilities, and then keep them coming back to the app regularly through couponing, geo-events and push notifications.
"The ability to order [makes] GetGo one of those apps they are checking throughout the week," said Phatak.
The most exciting factor for Glass is the convenience store industry's ability to expand the ordering app to non-foodservice items, increasing the basket with snacks, candy and more.
And now for the elephant in the room: price. Olo and, according to Glass, other similar providers charge a flat fee of $100 per store per month, nothing more. Phatak says that while ROI can't calculate the importance of brand perception, he estimates needing to sell about 15 dollars per day per store through the store to make it worthwhile. While it might take time to build up that kind of use, "look six, eight months down the road, that's not that unreasonable," he said.
When it comes to ensuring quality control, it's all about the check-in process.
"You have to put the guardrails around it so your synchronizing execution with pickup," said Glass.
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