The Future of QSR Chains: Order Ahead, Loyalty, and Contactless

The biggest fast-food and coffee chains are completely redesigning their digital roadmap to highlight the mobile experience first.

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The food service industry as we know it was effectively upended in 2020. Quick service restaurant (QSR) chains adapted quickly, focusing energy and investments on digital infrastructure while pivoting to future plans that emphasized drive-thru service, curbside pickup, and limited indoor dining.

QSRs focused on loyalty programs in 2020 as well, fine-tuning rewards programs and payment options to make it as easy as possible for diners to become repeat customers. Speed, efficiency, and safety were priorities across the board, as major restaurant chains across North America planned for a future in which mobile apps, predictive ordering, and touchless pickup are key.

Chipotle Announces First Digital-Only Storefront

  • The pick-up and delivery-only restaurant, called Chipotle Digital Kitchen, opened on November 14 in Highland Falls, NY.
  • Customers must order their food in advance via Chipotle’s app or website, or via third-party couriers such as UberEats.
  • The new design will allow Chipotle a stronger foothold in urban centers where large restaurants are not possible.

The digital-only restaurant, called Chipotle Digital Kitchen, is located close to a military academy in Highland Falls, NY. It has no dining room or front service line; customers will order their food online, via Chipotle’s app or website, or by using a third-party food delivery company such as Doordash or UberEats. Orders are picked up from a lobby that is designed to feature all of the sounds, smells, and kitchen views of an ordinary Chipotle restaurant, and the Digital Kitchen will also be able to accommodate large catering orders.

Chipotle has been a leader in digital-first ordering and infrastructure throughout the pandemic, and the digital-only restaurant reflects a growing QSR trend towards small-footprint restaurants with significant infrastructure for pickup or drive-thru orders. As of November, Chipotle averaged $1-million in digital sales per store in the US; the month prior, In Chipotle CEO Brian Niccol said the restaurant’s digital sales could exceed $2.5 billion in 2020.

McDonald’s Sets Digital Goals Fuelled by Loyalty, Drive-Thru

  • McDonald’s anticipated its digital growth would top $10-billion this year.
  • The McDonald’s growth strategy centers on the company’s MCD identity: Maximize our Marketing, Commit to the Core, and Double Down on the 3 D’s (Digital, Delivery, and Drive-Thru).
  • The fast-food chain plans to launch a newly updated loyalty platform, MyMcDonald’s, across its six top markets by the end of 2021, which will consolidate its tech investments.
  • McDonald’s is expecting mid-single-digit sales growth in 2021 and 2022 and forecasts annual capital expenditures of $2.3 billion.

Fast-food giant McDonald’s unveiled a robust digital growth strategy in November, as the company’s digital sales this year are anticipated to top $10-billion due to customer behavior changes due to COVID-19. The plan relies on the fast-food chain’s “MyMcDonald’s” program, a loyalty platform that will incorporate its technological investments (including its app and digital menu boards) across its six top markets by the end of next year. The platform, which will make it easier for customers to order and pay for their food, will also include a new loyalty program, which McDonald’s is planning to text first in Phoenix.

Two recent acquisitions—Apprente and Dynamic Yield—will be key to McDonald’s new digital strategy. Apprente is a voice technology solution, while Dynamic Yield is a personalization company; both were acquired by McDonald’s in 2019 for drive-thru technology. The company’s investment in digital and drive-thru tech is part of its three-tiered MCD growth strategy: Maximize our Marketing, Commit to the Core, and Double Down on the 3 D’s (Digital, Delivery and Drive-Thru).

Chipotle’s Billion-Dollar Digital Empire is Built to Last

  • Chipotle earned topped $1 billion in digital sales in multiple quarters this year for the first time, with those same quarters posting nearly 100% digital sales growth year-over-year.
  • Over seven million mobile loyalty program members signed up for Chipotle Rewards in less than nine months.
  • Chipotle is focused on opening what it calls Chipotlanes in most locations moving forward. Chipotlanes are specialized order-ahead windows that cater to app users.

Chipotle has become the QSR market’s top contender in tech adoption, posting unbelievable growth numbers that come as a direct result of a decidedly-digital reinvention. The company’s success has hinged largely on its loyalty program, which could hit 10 million members by the end of the year, in addition to its pickup-only Chipotlanes windows.

Thanks to its continual investments in digital infrastructure, Chipotle is a leader in the online-ordering game. Case in point: the average wait time for a Chipotlane order is 12 seconds—miles ahead of the four-minute industry average. “By better suiting our restaurants to accommodate the digital business, we’re able to finalize orders more effectively and provide a better overall experience for our guests,” Curt Garner, Chipotle’s CTO, said.

Burger King, Tim Hortons, Popeye’s Announce Massive Digital-Focused Drive-Thru Revamp

  • More than 40,000 digital screens are being installed at Restaurant Brand International’s (RBI) brands, which include Burger King, Popeye’s, and Tim Hortons.
  • The screens will feature technology such as predictive selling, integrated loyalty programs, and contactless ordering and payments.
  • More than 10,000 Burger King and Tim Hortons locations will receive the new digital screens, with Popeye’s beginning its own rollout later this year.
  • RBi is following other QSRs such as McDonald’s and White Castle by using personalization technology to enhance the drive-thru customer experience.

Restaurant Brands International launched a massive modernization of its drive-thru program, involving the installation of more than 40,000 digital screens across its restaurant properties. The new screens feature a number of tools that are geared towards COVID-19 dining habits, including contactless ordering and payments. RBI has partnered with Verifone to develop a new remote, contactless payment device, the first prototype of which has already been installed at a Tim Hortons location in Canada. The screens will also feature predictive selling technology, designed by RBI’s in-house Guest Intelligence team.

Jose Cil, CEO of RBI, said the company believes “strongly that it is time to modernize our drive-thru lanes throughout the US and Canada to provide even better, quicker and contactless service for our guests.” RBI also planned to more seamlessly integrate its loyalty programs into drive-thru lanes—loyalty programs being key among restaurants’ survival strategies during the pandemic.

Burger King Debuts Touchless Restaurant Concept

  • Burger King’s “Restaurant of Tomorrow” design features dedicated curbside delivery parking spots, pickup lockers, and multi-lane drive-thrus, among other contactless options.
  • The new restaurants, which will be 60% smaller than ordinary Burger Kings, are aimed at making the customer experience more comfortable during the COVID-19 pandemic.
  • Burger King will debut the new design at restaurants opening in 2021 in Miami, the Caribbean, and Latin America.
  • Both Taco Bell and Chipotle recently launched similar concept restaurants designed to prioritize order-ahead.

The fast-food chain’s “Restaurant of Tomorrow” design, which it debuted in September, was created by parent company Restaurant Brands International’s in-house design group. The design features a dedicated curbside delivery drive-in lane, where customers can pick up wait for pre-orders made on the Burger King app. Additionally, the new restaurants will have pickup lockers, also for pre-orders; multi-lane drive-thrus, including one that is dedicated to delivery drivers; and an outdoor walk-up pickup window.

Burger King’s new restaurants will be 60% smaller than the chain’s average location, due to less dine-in space, plus a suspended kitchen. Drive-thru customers will have their orders delivered to their cars from a conveyor belt system that is attached to this kitchen. The future is contactless, and Burger King’s new restaurant design makes the restaurant chain well-primed to weather customer needs during the COVID-19 pandemic and beyond, as digital ordering and takeout will continue to take precedence over in-restaurant dining.

Taco Bell Announces ‘Go Mobile’ Restaurant Concept

  • New store design initiative from Taco Bell, called Go Mobile, emphasizes order-ahead options and will include two drive-thru lanes, pickup shelves, tablet ordering, and curbside pickup.
  • Drive-thru usage at Taco Bell spiked by 4.8 million cars during the second quarter of 2020.
  • Go Mobile will also feature smart kitchen technology for Taco Bell staff.
  • Taco Bell plans to open the first Go Mobile store in the first quarter of 2021.

Go Mobile, which is what the Yum Brands restaurant chain is calling its new restaurant design concept, includes several new features that are tailored to contactless and order-ahead dining. These include two drive-thru lanes—one of which will be dedicated to pick-up of orders that have been made online through Taco Bell’s mobile app—plus pickup shelves and dedicated parking spots for customers who are collecting their online orders using curbside pickup.

Taco Bell President and Global COO Mike Grams said in a statement announcing Go Mobile that the restaurant design shows how “adapting to meet our consumers’ rapidly changing needs has never been more important.”

Starbucks Outlines AI-Powered Expansion of Walk-Thru Stores

  • Starbucks plans to use insights from Deep Brew, its in-house AI tool, to guide its future plans and expansion.
  • Deep Brew will also be leveraged for predictive ordering, to guide return customers towards menu items they may enjoy based on previous orders.
  • The company anticipates it will expand to 55,000 locations globally by fiscal 2030, with an emphasis on drive-thru stores in suburbs and “walk-thru” locations in urban centers.

In December, Starbucks revealed that much of its future growth will hinge on the launch of Deep Brew, the company’s proprietary AI, which will influence Starbucks’ operations from staffing and scheduling to inventory management and predictive ordering for customers. Deep Brew has been a priority for Starbucks throughout 2020, as the company fine-tuned its focus on digital operations, even pre-pandemic. Deep Brew currently runs calculations on inventory levels and predicts how many baristas are needed on staff every 30 minutes of the day, among other tasks. Starbucks’ future plans also include the prioritization of “walk-thru” stores in urban centers, where there is no seating.

The future, for Starbucks, is automated: customers will receive more drink suggestions, which will help Starbucks better manage its inventory and dedicate its human resources to customer service, rather than admin tasks. Deep Brew, Starbucks CEO Kevin Johnson said, “is where art and science come together so perfectly.”

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