IoT Industry Transformation Series: How IoT Is Changing the Restaurant Industry

Posted by on Jul 6, 2015 8:00:00 AM Olivier Coutand  
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IoT in the restaurant industryThe previous blog posts in our transformation series discussed how Internet of Things technologies are changing industries as various as fleet management, healthcare, and smart homes. Today, we’ll take a look at the restaurant industry. In the United States alone, there were approximately 630,000 restaurants at the end of 2014, and this accounted for over $650 billion in total sales. Obviously, this is a huge industry, not only in the U.S., but all around the world. And it’s no surprise that IoT technologies have already made an impact with restaurants.

Increased Speed-of-Service With Tableside Ordering

Probably one of the first applications of IoT in the restaurant business that comes to mind is using connected displays to take orders and process payments right at the customer’s table. This eliminates the need to manually transfer data to centralized systems. A myriad of restaurant tablet solutions, using either customized or consumer platforms (such as iPads) are already available on the market, and they’re more and more widely adopted by restaurants.

For customers, tableside ordering can have a very positive impact on their experience in the restaurant. Orders can be taken faster and immediately sent to the kitchen for preparation. Servers can also spend more time at the table and provide a more attentive service to the guests. An added benefit for customers is their credit cards don’t have to leave the table during payment, dramatically reducing the fear of fraud on their cards.

These IoT tableside solutions can also greatly facilitate restaurant management. Orders are more easily and quickly communicated to the kitchen, and servers have access at any time to the restaurant’s entire menu for personalized recommendations and for upsells.

The Next Generation of POS: Ordering From the Table

Tableside ordering is being brought one step further. Companies like Ziosk and E la Carte are now offering IoT connected tablets attached to dining tables, allowing guests to browse through menus, place orders, request drink refills, and pay bills, without needing the assistance of restaurant staff. Customers can enjoy faster and more interactive service. But early studies have also shown an interesting increase in certain orders. By flashing appealing food photos on the tablet screen, the technology has reportedly been found to boost appetizers sales by 20% and desserts by 30%.

Today, these IoT solutions are primarily being deployed in casual dining chains (Applebee’s, Chili’s, Olive Garden, and the like), but if they fulfill their promises, restaurant tablets could soon make a breakthrough into finer dining establishments.

The benefits of IoT technologies aren’t limited to speeding up customer ordering or upselling menu items. They create a new pathway for an older industry to embrace marketing’s best practices and strengthen their customers’ engagement with their brand. Ziosk and E la Carte are already offering services on their restaurant tablets to increase customer conversion via loyalty programs or brand exposure on social media.

And Tomorrow: Increased Customer Experience With Location-Based Mobile Marketing?

With the advance of near-field technologies and especially Bluetooth beacons, it seems that the restaurant industry, just like retail, is on the cusp of revolutionizing its in-store and nearby-store experience. Beacons are small devices using low-power Bluetooth connectivity, and they can be installed indoors, like on shelves or walls. When customers pass nearby a beacon, the device can communicate with the customer’s smartphone. In restaurants, some new use cases are about to emerge, such as marketing attractive offers to people walking by and even sending personalized notifications based on a customer’s preferences.

Some companies are already gaining momentum in location-based mobile marketing. Swirl is providing a beacon-powered mobile marketing platform to retailers and recently announced it’s closing an $18 million investment from several investors, including Twitter. Likewise, the kiwi startup VMob is helping McDonald’s offer targeted vouchers and consolidate in-store loyalty. VMob has already been working with McDonald’s in the Dutch, Swedish, and Japanese markets and recently signed a global deal with the fast-food company to roll out the technology in up to 119 markets, including the U.S.

So while restaurants and dining may seem like one of the oldest businesses in the world, the industry is beginning to speed into the future with IoT technologies. Whether at the dining table or on your smartphone, more and more restaurants are seeing the benefits of being connected to their customers.

Topics: Restaurant IoT, Mobile Marketing