June 3, 2016

Predictions on the Impact of Mobile Payment in Restaurants

“As technology evolves, so do restaurant customers’ expectations.”  This was the statement made by the president of the hospitality division of NCR, Paul Langenbahn.  And, for all intents and purposes, it’s entirely factual.


Modern IT and technology has reached a place that allows its users to augment their lives with it, often without even noticing.  It is possible for users to channel technology via numerous streams in order to create a cohesive experience – one at which they are the centre.

It is thus fully understandable that restaurant customers would want to use technology to enrich, and often speed up, the payment process.  After all, the traditional payment method could put a damper on an otherwise exceptionally enjoyable dining experience.

According to Langenbahn, restaurants need to be aiming at a “frictionless guest experience” if they are to affirm their relevance in the industry which is currently subject to shaping by modern technology.  For those that need a little nudge in making the connection, the aforementioned guest experience largely applies to mobile.

The Prevalence of Mobile Technology in Restaurants in 2016

Forrester Research predicted that mobile payments in the restaurant sector in the US would exceed 142 billion dollars in 2016.  With this in mind, the industry is certainly making great inroads when it comes to mobile service offerings – a fact that is likely driven by the idea that customer demands are affected by technological advancement.

In fact, the American Express Restaurant Trade Survey – the figures of which were released in April of 2016 – indicated that, on American soil, customer satisfaction was the head of the three main factors driving restaurant operators towards the implementation of mobile technology.  According to the survey, the three main factors are the increase of customer feedback that can potentially increase the overall dining experience, the increase of efficiency in general operations, and the ability to reduce costs.Taking-payment-via-mobile-phone-1024x576

Interestingly, all three of these factors seem to be met with one solution in Asian Pizza Huts.  The Asian wing of the fast-food pizza chain has announced that robotic cashiers may make an appearance in Eastern branches before the end of the year.  This robot, named Pepper, will be able to take orders, take mobile payment, and engage with customers.  And, importantly for the chain’s bottom line, it will be cheaper to maintain than a human employee.

This may present a bleak outlook for the global employment circumstances of the foreseeable future, but it also underlines the food service industry’s willingness to embrace technology in order to satisfy customers.

Back on American soil, the popular mobile POS, Breadcrumb, is being acquired by fellow company, Upserve.  Breadcrumb currently handles many front-of-house functions, such as menu customisation, table and order management, and mobile payment.  Upserve handles the back-of-house requirements, such as staff performance tracking, guest profile building, and menu optimisation.  Together they will represent a step forward in mobile integration in the food service industry – one that some 6000 US restaurants are already geared to take.

With numbers like these, could there be any reason to think that mobile payments aren’t a service that restaurants are clamouring to offer?  According to recent research, as much as a third of restaurants feel they are behind on the tech front.  But, if we’re on the cusp of robotic server/cashiers, how could this be?

The answer, it would appear, lies in necessity.  Fast-food restaurants have speed of service at their core.  Their returns are based on how quickly they can serve customers, and so it is in their best interest to use technology to help them improve in this area.  More traditional restaurants, on the other hand, may feel that speedy service compromises the guest experience.  Similarly, they may not be able to justify the cost of technological integration.
However, this is the service industry and the customer is always right.

Why Customers Want Mobile Payments in Restaurants

table discussion

Firstly, it must be said that the UK is not lagging in embracing technology.  Way back in 2014 mobile payments were already a priority for UK restaurants.  The reason for this was cited as customer demand – and this factor has not changed.

Last year it was revealed that about a third of UK customers preferred the idea of paying via mobile as opposed to asking their waiters to prepare the bill.  And, given the way that mobile is constantly finding new ways to make diners’ experiences more convenient, this number has likely grown since then.

The fact of the matter is that consumers’ lives are being made ever easier by technology.  Tasks that once took hours of preparation time now can now be accomplished in minutes, and sometimes don’t even require leaving the house.  It makes sense that this type of convenience elsewhere in the lives of diners would make them wish for the same level of convenience during their restaurant experiences.

How Mobile Payments Benefit Restaurants

Of course, keeping customers happy is a large factor in any service industry.  It thus stands to reason that, if customers want more mobile integration in their dining experiences, restaurants should want to oblige them simply to keep their clientele happy.  However, mobile integration doesn’t just benefit restaurant customers; it greatly benefits restaurants as well.

While there are many advantages of mobile integration, there are two that may be of particular interest to restaurant operators.  These are efficiency and safety.

Many restaurant owners want to provide the absolute best service possible, and thus don’t rush their customers to pay their bills.  However, increased table turnaround means bigger profits.  One of the benefits of mobile payment is that it increases the ease of bill payment, which increases turnaround, and profits, organically.

On the safety front, many restaurant operators enjoy offering mobile payments because the process ensures the safety of the customers’ credit card details through encryption.  Safer customers mean fewer headaches for restaurant operators – a concept which will always be embraced with open arms in the strenuous world of food service.

The Impact of Mobile Payment in the Future

Holding mobile phoneExpect mobile payments to continue to rise.  The reason for this is simple; it’s what customers want.  With people being able to do so much through mobile technology, it’s completely understandable that they want this to expand to all areas of their lives – dining included.

However, restaurants have found that mobile payments allow them to increase turnaround without sacrificing service excellence, which makes mobile payments very attractive to them as well.  Add to this the fact that offering mobile payments increases customer satisfaction and you’ve got a no-brainer.

Any restaurant that drags its heels in embracing this technology risks not only being rendered irrelevant, but being left behind by the competition.