Business case for self serve kiosks

Topics
Kiosk
Author
Andrew Capozzi
Publication Date
16 January 2020

Business case for self serve kiosks

If there’s one thing you can say about restaurant kiosks, it’s that they are impossible to ignore. This technology has been front-and-center at some of the largest and most successful quick service restaurants (QSRs) for quite some time.

While it’s easy for the casual observer to dismiss QSR kiosks as a novelty or cost-cutting measure, major players in Foodservice understand that kiosks are set to play a critical role in the way they engage customers, build brand loyalty, promote new products, and improve operational efficiencies. Technology options now factor into restaurant choices for about one-quarter of consumers, so it shouldn’t surprise anyone that many major QSR and Fast Casual restaurants such as McDonald’s, Subway, Panera and Wendy’s all have kiosks throughout their stores. 

No, the real story here isn’t that kiosk restaurant technology is gaining traction — it’s why. What are the real factors that are leading restaurant operators to change the way they interact with customers, and why should your business consider doing the same? To answer, we need to dive deeper into the business case for kiosks.

Kiosks Will Bring in New Customers (i.e. Millennials and Gen Z)

When the largest demographic on earth shows a strong preference for wanting digital self-service, you’d be wise to cater to it (pardon the pun). Recent surveys have shown that 61% of millennial consumers are likely to place an order using a self-service ordering terminal (if provided with the option), while 62% would place an order online. As one industry expert recently said, “The language of the millennials is digital.”

Indeed, it’s not surprising that the generation “raised by technology” would prefer this type of digital, customizable ordering experience. What’s surprising is that QSRs haven’t acted faster in providing this alternative. These brands spend billions marketing and advertising to millennials, so kiosks can and should be used to augment these efforts.

Of course, once you’ve acquired a new customer, you’ve now got to keep her coming back, which leads to our next point...

Kiosks Will Increase Customer Satisfaction (oh, and revenue)

It doesn’t always take a market research firm to pinpoint what prevents a one-time customer from becoming a repeat customer. For QSRs, it basically boils down to three common complaints:

  • The service was slow: This can occur either because the customer was indecisive (fries or onion rings?!?) thereby slowing service for the person behind him, or because the cashier was not on top of her game. Kiosks obviously help speed this process up by letting customers order on their terms. With time on their side, they are also more likely to try items they may have overlooked in the past.
  • The order was wrong: Assuming the kiosk application is intuitive (and this is a big assumption), customers will be able to ensure better accuracy by selecting menu items themselves. After all, the customer is always right.
  • The experience was poor: Well, apart from kiosks not being rude to customers, they can also improve the dining experience with personalization (i.e. remembering recent orders, making recommendations based on previous orders, etc.).

The more control customers have over their experience, the happier they will be, and the more likely they are to return. This is true for every business, but it’s especially true for QSRs, where the percent of repeat customers is exceptionally high. As you can see from the above examples, kiosks can play a significant role in eliminating (or at least mitigating) the source for most customer complaints.

What about revenue? For one thing, satisfied customers will be more inclined to come back to your business and recommend it to their friends. But self-service kiosks can also result in higher ticket sizes on average for each visit. How? Kiosks make it easier for customers to review all of their choices. And a kiosk can make suggestions on every screen, so customers are more likely to discover new menu items and add-ons. There are also many who believe that guests are more likely to upsize or add a desert than when they don’t have to make the request to a live person.

Kiosks Will Improve Efficiency (but not by firing everyone)

There’s a huge misconception that the QSR industry would like to do away with all human employees at some point, and the cynics view self-serve kiosks as a step in that direction. Yes, all  businesses want to reduce costs, but ultimately kiosks can be a way to hire more people — just not necessarily cashiers. Here’s what Blaine Hurst, Panera’s Chief Transformation & Growth Officer, had to say on the matter (emphasis added):

"The consumer-facing technology results in labor savings for Panera; these hours are redeployed in the cafe. In fact, in most cases, Panera increases the number of associate hours in our cafes; and they see increases in overall guest satisfaction.”

Properly implemented, kiosks can shift a significant percentage of employee costs away from order taking and towards order delivery. When the former accounts for roughly 30% of a QSRs total cost, any improvement is going to be significant.

Self-service technology also has application with team members. Staff can use tablets to help customers in the store or the drive thru to help alleviate wait times. The result is a more efficient use of time for employees as well as customers.

What Qualities Should You Look for in a Self-Serve Kiosk?

Earlier, we mentioned the benefits a custom self-serve kiosk can have for your business provided that it's intuitive and fun for customers to use. But what makes the difference between a self-service experience that customers love and one that will leave them frustrated? And what's the best fit for your business? Here are some of the top qualities you should consider when you evaluate kiosks to determine which is best for you:

  • Ease of use: Kiosk solutions must be easy for customers to use, but you should also make sure to pick a solution that meets all of your needs. For example, you may want to customize your restaurant menu by including nutrition information and allergens for specific menu items. Not all kiosks are geared toward customization, so that's another factor to consider as you choose a solution.
  • POS integrations: Standalone kiosk systems are rare. Most operate on the same software that restaurants, cafes and other businesses use for their POS systems so that should be taken into account early in the planning process.
  • Payment processing: When it comes to self-ordering kiosks, convenience is key - make sure you offer guests multiple contactless payment options  Customers are becoming increasingly reliant on mobile wallets and gift cards, so you should take these features into consideration.
  • Loyalty program: How will a kiosk solution allow existing loyalty customers to keep earning and burning? Make sure your solution allows for an easy method for customers to identify themselves without exposing personal information.
  • Personalization: Be sure to integrate a solid recommendation engine into your solution. This will allow you to keep the experience fresh while also expanding your average order value as customers add additional, suggested items to their virtual bags. 

While kiosks can have benefits for businesses in nearly any industry, there's no such thing as a one-size-fits-all kiosk solution. You know your business and your customers better than anyone, and once you consider the above factors, you're sure to find the right solution for your company.

Final Thoughts

It needs to be stressed that a kiosk itself will not help you reap these benefits on its own. A kiosk that does not make it easier for consumers to place an order will not draw them into your restaurant. If you’re unaware of your most common complaints, a kiosk will do little to improve the customer experience in any measurable way. And without the right support staff, kiosks can actually make your business less efficient (and less profitable).

Like any digital solution, kiosks are only going to deliver lasting value if they are intuitive, fast, and fun to use — and if they are designed by people with insight into the business. But when designed and delivered successfully, they have the potential to make a meaningful impact.

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