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On-premise Restaurant Technology - US - August 2019

"On-premise restaurant technology such as kiosks and tablets are offering operators multifaceted solutions to growing labor challenges and consumer demand for speedy foodservice; however, most consumers are still not very accepting of fully-automated restaurant concepts. Operators should lean into consumer-friendly tech solutions such as pre-ordering options and tableside payments for sit-down meals, but they should not yet do away with human-derived hospitality."
- Jill Failla, Foodservice Analyst

This Report will cover the following areas:

  • Many consumers still prefer humans to kiosks
  • There’s low consumer interest in fully automated restaurants
  • Legislation creates growing barrier to seamless technology
  • Mobile app-based loyalty programs offer a huge opportunity for personalization
  • On-premise tech meets consumers’ growing need for speed
  • Pre-ordering and pre-payment service for dine-in could boost FSR business

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • Key takeaways
          • The issues
            • Many consumers still prefer humans to kiosks
              • Figure 1: Kiosk barriers, May 2019
            • There’s low consumer interest in fully automated restaurants
              • Figure 2: Interest in on-premise technology concepts and attitudes around on-premise technology, May 2019
            • Legislation creates growing barrier to seamless technology
              • The opportunities
                • Mobile app-based loyalty programs offer a huge opportunity for personalization
                  • Figure 3: On-premise technology experience, May 2019
                • On-premise tech meets consumers’ growing need for speed
                  • Figure 4: Kiosk motivators, May 2019
                • Pre-ordering and pre-payment service for dine-in could boost FSR business
                  • Figure 5: Interest in on-premise technology concepts, by age, May 2019
              • The Market – What You Need to Know

                • A highly competitive labor market and need for speed give rise to on-premise technology
                  • Growing off-premise business and tech could diminish the ROI of on-premise tech
                  • Market Perspective

                    • Seamless retail expands
                      • Off-premise tech continues to show strong growth
                        • Figure 6: Restaurant delivery usage in the past three months, June 2016 and September 2018
                    • Market Factors

                      • Labor wars continue
                        • Low unemployment rates mean increased competition
                          • Minimum wage laws
                            • What does it all mean?
                              • Figure 7: Unemployment and underemployment, January 2007-May 2019
                            • Consumers increasingly prioritize speed at restaurants
                              • Figure 8: Dining out occasion motivators, July 2018
                              • Figure 9: Dining out occasion motivators, by parental status, July 2018
                              • Figure 10: QSR Visitation Drivers, February 2019
                            • Consumers are amenable to new technologies
                              • Figure 11: Attitudes toward technology – NET agreement, February 2019
                          • Key Trends – What You Need to Know

                            • AI breaks out, with ample room for future innovation
                              • Laws set limits on cashless operations and facial recognition tech
                                • Tech offers opportunity for FSRs to catch up
                                • What’s Working?

                                  • AI breaks out in foodservice
                                    • Mobile-based loyalty apps
                                      • Self-service alcohol
                                      • What’s Struggling?

                                        • Cashless concepts
                                            • Figure 12: Legacy Food Hall’s Hall Pass
                                          • Fully automated stores
                                              • Figure 13: Wow Bao’s fully automated front-of-the-house store opened in summer 2018 using Eatsa’s cashless technology
                                          • What’s Next?

                                            • Order- and pay-ahead for FSRs
                                              • Tableside payments
                                                • Customization 2.0: AI activates personalization
                                                • The Consumer – What You Need to Know

                                                  • On-premise technology’s benefits outweigh its drawbacks
                                                    • Consumers are very interested in mobile-based loyalty programs
                                                      • Consumers are wary of newer on-premise technologies, such as fully automated restaurants and facial recognition tech
                                                      • On-premise Technology Experience

                                                        • Most consumers are either using or interested in a mobile-app-based loyalty program
                                                            • Figure 14: On-premise technology experience, May 2019
                                                          • Young parents are among the heaviest users of on-premise tech
                                                            • Figure 15: On-premise technology experience – NET, any usage of tablets or kiosks, by CHAID analysis, May 2019
                                                          • Men are heavier kiosk users than women
                                                            • Figure 16: On-premise technology experience – NET, any usage, by gender, May 2019
                                                          • Millennials lead in mobile-app loyalty program usage
                                                            • Figure 17: On-premise technology experience – NET any usage, by generation, May 2019
                                                          • White and Hispanic consumers drive on-premise tech-based payments
                                                            • Figure 18: On-premise technology experience – NET any usage, by race and Hispanic origin, May 2019
                                                        • Kiosk Motivators

                                                          • Most consumers choose kiosks for speed and convenience
                                                              • Figure 19: Kiosk motivators, May 2019
                                                            • Kiosks can help boost check averages among young consumers
                                                              • Figure 20: Kiosk motivators, by age, May 2019
                                                          • Kiosk Barriers

                                                            • Preference for human interaction is the top barrier to kiosk usage
                                                              • Figure 21: Kiosk barriers, May 2019
                                                            • Kiosks that don’t accept cash detract some young consumers
                                                              • Figure 22: Kiosk barriers, by age, May 2019
                                                          • Technology Associations by Restaurant Segment

                                                            • On-premise tech is most closely associated with fast food and casual dining
                                                              • Figure 23: Technology Associations by Restaurant Segment, May 2019
                                                            • Kiosks strongly resonate with LSRs, and tablets with FSRs
                                                              • Figure 24: Technology Associations by Restaurant Segment – NET segment type, May 2019
                                                          • Mobile-app-based Loyalty Program Motivators

                                                            • Many consumers are motivated by ongoing discounts from mobile-based loyalty programs
                                                                • Figure 25: Mobile-app-based loyalty program motivators – NET any rank, May 2019
                                                              • Gen Z is most likely to be encouraged by subscription-style, mobile-app loyalty programs
                                                                • Figure 26: Mobile-app-based loyalty program motivators – NET any rank, by generation, May 2019
                                                              • Lowest-income consumers value personalization from mobile-app loyalty programs
                                                                • Figure 27: Mobile-app-based loyalty program motivators – NET any rank, by income, May 2019
                                                              • Ongoing discounts appeal to majority of White consumers
                                                                • Figure 28: Mobile-app-based loyalty program motivators – NET any rank, by race and Hispanic origin, May 2019
                                                            • Attitudes around On-premise Technology

                                                              • Consumers are notably interested in tableside payment
                                                                  • Figure 29: Attitudes around on-premise technology, May 2019
                                                                • Gen Z appreciates tech-based personalization on premise
                                                                  • Figure 30: Attitudes around on-premise technology, by generation, May 2019
                                                                • Technology is a restaurant visitation driver for Hispanics
                                                                  • Figure 31: Attitudes around on-premise technology, by race and Hispanic origin, May 2019
                                                              • Interest in On-premise Technology Concepts

                                                                • Consumers are still relatively wary of innovative on-premise tech
                                                                    • Figure 32: Interest in on-premise technology concepts, May 2019
                                                                  • Women are particularly interested in dedicated drive-thru lanes for mobile orders
                                                                    • Figure 33: Interest in on-premise technology concepts, by gender, May 2019
                                                                  • FSRs can attract young consumers by allowing them to order and pay online before dine-in meals
                                                                    • Figure 34: Interest in on-premise technology concepts, by age, May 2019
                                                                  • Asian consumers are the most interested in fully automated service and integrated restaurant kiosks
                                                                    • Figure 35: Interest in on-premise technology concepts, by race and Hispanic origin, May 2019
                                                                • Appendix – Data Sources and Abbreviations

                                                                  • Data sources
                                                                    • Consumer survey data
                                                                      • Consumer qualitative research
                                                                        • Direct marketing creative
                                                                          • Abbreviations and terms
                                                                            • Abbreviations
                                                                            • Appendix – The Consumer

                                                                              • CHAID Analysis Methodology
                                                                                • TURF Analysis Methodology
                                                                                • Appendix – The Market

                                                                                    • Figure 36: Total US revenues and forecast of restaurants and eating places*, by segment, at current prices, 2018 and 2023

                                                                                On-premise Restaurant Technology - US - August 2019

                                                                                £3,435.47 (Excl.Tax)