The Restaurant Industry in 2020 + Beyond
Despite the innumerable and obvious setbacks the coronavirus has had on the restaurant industry, there are some silver linings amidst the challenges. We spoke with restaurant industry representatives to get a gauge on what the restaurant and service industry currently looks like and what the future holds moving forward.
Innovative offerings (delivery, technology, online services, etc.)
“From take-home kits with the ingredients to make a meal to online cooking classes and family-style meals, restaurants are diversifying their offerings to meet their patrons where they are.”
Innovation is the key theme for 2020. Brands are speeding up processes planned for 2025, companies are adapting technologies to make their services more nimble and efficient - the world is changing, and if brands don’t quickly evolve, they will get left behind.
In the past six months, in order to serve consumers and offer safety measures, the restaurant industry has become proficient in online ordering and delivery or curbside pick-ups. Although some restaurants are opening back up again, safety measures are still in place, and most innovations are here to stay.
Sergio Perez, the Director of Digital Marketing at Huddle House and Perkins Restaurant & Bakery shared, “Serving is at the core of what the restaurant industry is about. From colleagues helping other colleagues in other departments, to the tech industry developing solutions for restaurants, the spirit of ‘we’re all in this together’ is alive and well.”
He continued, “As breakfast-forward brands, Huddle House and Perkins have been challenged with the reality that most people who typically commute to work are now embracing the work from home lifestyle. This change alongside guests’ concerns over the pandemic and seating capacity regulations have limited our ability to serve guests. While this has tested us and the rest of the industry, it has inspired creative and nimble solutions. During this time, we focused on creating additional revenue drivers through convenience and technology initiatives like online ordering and delivery, and other more creative solutions like offering staple grocery items at our restaurants.”
Perez then detailed upcoming, notable trends in the restaurant industry that focus on the consumer, and the innovative changes occurring within each.
#1 Digital Ordering Platforms
“Today more than ever having a platform that allows guests to order food for pickup, curbside pickup or delivery is paramount to enabling restaurants to serve food regardless of the capacity status of the dining room. Having a digital ordering platform is not enough, ensuring that the user experience is frictionless, accessible, and offers a personalized experience will help drive more meaningful experiences for guests.”
#2 Loyalty Programs
“From keeping up with their local restaurant news to earning rewards or perks, guests will continue to leverage loyalty programs to engage with their favorite brands. It’s imperative that brands think about the entire hunger journey and find meaningful ways to deliver relevant and timely communications when guests are trying to make food purchase decisions. Doing this will ensure that you have an engaged audience that you can rely on to help drive the sales, while reducing the need to continuously acquire new guests, which tends to be more expensive. To put simply, gone are the days of mass communication that lure guests with discounts, and in are the days where personal communication adds value, inspires action and sparks emotion.”
#3 Localization
“Similar to why people tune in to the local news, guests want to know what is happening in their community and the pandemic has amplified the need for more local experiences. Brands will continue to deploy local marketing resources and programs to help re-engage core guests, to build stronger relationships in the community, to amplify the brand’s message, and to steal share of stomach from other competitors.”
Updated food safety procedures
Not only did all contributors note the improvement of food safety procedures, but they all noted this attention to detail is a priority moving forward.
Andrea Simrell, the Public Relations Director at VantagePoint Marketing, a marketing agency that specializes within the food industry, shared that, “Research from Datassential indicates that 90% of restaurant operators said their updated food safety procedures are effective and WILL continue after COVID. This will help ensure the safety of employees and patrons in both the short- and long-term. Additionally, many restaurant operators are interested in new technology and other innovations that make their kitchens more efficient and flexible. These considerations will continue to be important to restaurants as they navigate what’s next.”
Adapted procedures to offer solutions
“Those that have not met people where they are and are not building great digital experiences are doomed.”
With groundbreaking innovations, the restaurant industry is rapidly adapting to adjust processes and cater to constantly changing consumer needs.
Simrell shared that, “Many of our clients manufacture equipment or provide tools and services to keep restaurant kitchens running. We’ve seen them adapt with new offerings to meet the current needs of their customers — including modular options, hands-free alternatives and solutions for delivery and carryout. Successful innovations in other foodservice segments, such as healthcare or education, have been adapted for restaurants and vice versa, as the entire industry works together during this pandemic.”
“The pace of digital adoption has exponentially changed the game and set a new bar. The ones who had already focused on their digital transformation pre-COVID were prepared for it. Those who were behind either had to catch up or they sank. ”
While there were already companies ready for advanced digital measures, other companies must adapt to fit into the “new normal” which, as Shannon Delaney, the Vice President of Marketing for Dinova, shared, “will look like the current level of digital adoption. Things like using mobile apps to pay for food, curbside pickup, new sanitization standards, and the way food is packaged (for example individually packaged food or sealed food) are all parts of the new normal.”
Some restaurants like Huddle House, Inc. and Perkins LLC are partnering with experts to make the digital adoption smoother and more successful. Perez noted, “With limited capacity in restaurants, we had to accelerate off-premise programs like online ordering and delivery, and we had to connect these new programs to a database so we could further communicate with our guests. To bring this to life, we partnered with two best-in-class companies in the restaurant industry: Olo, the leading provider for digital ordering in the industry, and Paytronix, an all-in-one customer engagement platform. With their help we were able to launch a new custom-built website and a new mobile app that allows guests to earn and redeem points for all their online and delivery orders.”
Eye-opening discoveries about the industry + the “essential” people who make it
This pandemic has revealed truths to people and taught communities about empathy and perspective. One of those truths is how undervalued and under-acknowledged essential foodservice workers are in the business.
Delaney shared, “I am moved by how the industry brought attention to itself about how undervalued the workers are and how tight the margins are. These people are struggling to get healthcare. The industry worked really hard to care for itself. Jose Andres and Guy Fieri both worked hard to take care of restaurant workers. A lot of Michelin star chefs (like Tom Colicchio) have been talking to the government about how to take care of these essential (foodservice) workers to keep America fed.”
She added, “Another silver lining: COVID made people aware of the huge fees 3rd party delivery services charge. It will force 3rd party delivery services to be fairer.”
“It is a very service-oriented industry that is essential. People are willing to invest to keep the small restaurants they love in business.”
Like many other industries, the restaurant industry was forced to quickly innovate to survive. Moving forward, businesses have a better idea of where their focus and energy is best served. “Recovery will be the primary focus for 2021, but we believe the trends of delivery (and the tools needed to execute it effectively), plant-based menus and automation in both the front and back-of-house will continue to influence the restaurant industry in the coming months,” shared Simrell.
Perez put it best, “As we continue to navigate this pandemic, a few things will stay with us including a hyper-focus on safety and sanitation, the need to accelerate a digital transformation that makes convenient for guests to order and engage with the brand, and the need to acquire guests through owned channels like loyalty. Taking these steps, specifically around online ordering, delivery and owned channels, are and will continue to be paramount to the recovery of not just Huddle House and Perkins, but the industry.”
The marketing world is always changing, but the core principles of great leadership stay the same. To help you navigate this evolving landscape, we’ve gathered insights from some of the top CMOs in the business from our featured 2024 CMO Spotlight interviews. These ten lessons are just as relevant now as they’ll be in 2025, offering practical advice on leading with impact and staying adaptable in a fast-moving marketplace.