Consumer behavior is shifting, driving changes to how food is accessed. From more people working from home to video-streaming services, foodservice research firms Technomic and the NPD Group have identified a whole host of factors contributing to these changes.
As a result, people are relying more on non-traditional sources, such as grocery stores, convenience stores, meal-kit delivery services and others to get restaurant-quality food. And they’re using mobile technology to find something to eat, place an order and pay for it. This is putting pressure on market share and resulting in lost revenue and declining guest counts for some full-service operators. Simply put, consumers have more options and more access to those options than ever before.
While all of this is creating some unique challenges for operators, there is a bright spot: consumers still want restaurant-quality food. They just don’t necessarily want to eat it in a restaurant. This is where portability comes in.
Portability is a sales growth strategy you can add to your full-service restaurant’s overall annual strategy to meet consumers where they’re at and potentially regain lost sales and guest counts. This strategy helps target those lost sales and guest counts by offering easier, more affordable ways to get your food to customers, namely enhanced takeout, delivery and/or a retail extension—all of which are less costly approaches to portability than say, a food truck or branching out into catering.
One key component is that you should consider offering a mobile ordering solution alongside at least one of the three portability approaches. Consumers use mobile technology in their daily experiences. Consider the sweeping adoption of Uber and Amazon. That anywhere, anytime access, ease of selection and ability to pay through their smartphone is not only what they want, but what they expect, from you, so it’s important for you to meet them where they’re at with your own mobile ordering solution.
Lunch and early-in-the-week dinners (Sunday-Wednesday) offer the biggest sales potential for portability, as this is when guest counts tend to be softer for full-service operators and when you’ve likely lost the most sales.
4 Steps to adopt portability
Adopting portability can help you build sales and take market share away from both traditional and non-traditional competitors. But before you pick a portability approach, there are a few steps you should walk through, which will help guide you to the one that’s best for your operation.
Step 1: Conduct a competitive analysis
Look at what your competitors are doing in this arena. Who has implemented online ordering? Who does the best with portability and what drives customers to their location? How could you improve on others’ processes?
Step 2: Define or refine your target audience
Knowing who you’re designing your portability program for is key. Honing in on your target audience can yield additional insights, such as packaging and mobile ordering preferences.
Step 3: Assess your capabilities
Portability will necessitate more back- and front-of-the-house activity. Assessing your ability to handle this additional execution will set you up for success.
Step 4: Select a portability approach
Portability comes in three forms: enhanced takeout, delivery and retail extension. Your work in steps 1-3 will help you decide which channel makes the most sense for you.
Enhanced takeout
This approach focuses on offering menu items that travel well. It gives guests access to your food whenever, wherever, and allows you to increase your business outside your existing footprint without a costly expansion. Enhanced takeout is also a great opportunity to build and expand your brand and attract new customers.
Consider scaling your takeout menu along these lines:
- Single-serving dinner for one
- Conveniently packaged family meal that serves four
- On-the-go snack to get someone through their day
- Shareables for those who still want to socialize while eating
Delivery
Restaurant delivery has been around for some time, but there are now far more options for getting food from your location to your customers—including national, regional and local services that save you from bearing the full cost of having dedicated drivers on-hand.
Third-party delivery vendors may offer a number of additional benefits you’d otherwise have to pay for yourself, including marketing, an online ordering app, text and fax order capabilities, and customer feedback and complaint systems. Evaluate all of these factors to help determine if a third-party service is right for you.
Keep in mind that sales will likely be incremental from a new delivery service.
Retail extension
Retail extensions can take a simple form of grab-and-go offerings. This strategy relies heavily on foot traffic and appeals to customers who want to simply drop in and pick up pre-packaged items. Selecting the right menu items and keeping them aligned with your overall brand is essential to this approach.
Remember mobile is a must
Whichever portability strategy you choose, it’s important that you enable customers to order and pre-pay via mobile. You can offer mobile ordering by having an app custom-built, adding online ordering to your website and/or connecting to social media technology.
With the right technology in place to help customers access your portability offering(s), you’ll be well positioned to capitalize on consumers’ desire for restaurant-quality food where and when they want it.
Portability in Action
Some of the biggest names in foodservice ramped up their portability strategies in 2017:
- The Cheesecake Factory teamed with DoorDash as its exclusive delivery partner. Source: HVS Executive Search, January 2018
- Denny’s launched 24-hour delivery service, along with enhanced mobile ordering and new takeout packaging. Source: Nation’s Restaurant News, May 2017
- Bloomin’ Brands, whose properties include Outback Steakhouse and Carrabba’s Italian Grill, began testing both third-party delivery providers and a company-operated delivery service. Source: Nation’s Restaurant News, February 2017
- TGI Fridays saw takeout sales grow 30 percent in the year since it introduced online ordering. Source: HVS Executive Search, January 2018
Location Matters
If you are in a college town, downtown or densely populated area, all three portability strategies could serve you well in driving growth. In suburban and rural areas where driving is the main mode of transportation, delivery and takeout may make the most sense.
Decision Support
Connect with your Sales Representative to determine if portability is right for you and ask them about the team of experts who can assist you in assessing the three approaches to determine which one is best for your operation.
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