The pandemic has led to many changes, including where consumers eat and how they get their food. Full-service restaurants, in particular, have struggled, while quick-service restaurants, though initially impacted by closings and consumer concerns about safety, have bounced back over the summer. For example, McDonald’s, which initially saw a 19% sales drop in April, is basically back on track compared to last year. Executives attribute the bounce back to drive-thru sales, which made up 90% of the chain’s sales in the quarter.
The strong sales numbers from brands with drive-thrus, and the likelihood that the pandemic could stretch on for some time, have other QSRs considering how to encourage more digital orders for their stores, sometimes remodeling to add drive-thrus and pick-up windows.
Digital Strategies Have Helped QSRs Connect With Consumers And Scale Revenues
Throughout the pandemic, the implementation of digital strategies has helped QSRs stay top of mind and relevant for consumers. Brands made changes to their apps to help consumers feel safe about ordering, including offering contactless delivery, seamless payment options and curbside pick-up, which drove some QSRs to see a 36% bump in first-time adopters to their apps. The growth of digital experiences for QSRs is an important part of plans to expand during and after the pandemic.
Chipotle Plans To Expand Its “Chipotlanes” Which Are Thriving Due To Digital Ordering Growth
“The digital experience has just exploded with COVID,” said Scott Boatwright, Chipotle Chief Restaurant Officer. “And, that business has been really sticky.” The Chipotlanes at the popular QSR chain are entirely app-driven, with customers ordering online and picking up their food at the windows, with the exchange of food taking “mere seconds” according to Boatwright. For customers who approach the window without having placed an order, Chipotle employees will help them place an order on the app, encouraging future app downloads from these customers.
Chipotle saw digital sales grow more than 80% year over year and is preparing to open their 100th Chipotlane, as part of an expansion that will include 150 new restaurants with 80-100 Chipotlanes planned. Boatwright explains that refinement of the drive-thru service is ongoing, noting that the brand is “tailoring that [drive-thru] experience on what the transaction would look like, being brief and responsive to the guest. We’ve tweaked and made some modifications on how we deliver that experience more fully… We’re going to continue to evolve.”
Shake Shack Contemplates How To Implement Drive-Thru Options, Expanding Their Digital Business
Shake Shack, which currently has no drive-thru stores, is looking for ways to implement drive-thru service that can work in the many urban locations the brand has. “Shake Shack is being a little more impacted than your average fast casual or certainly than the QSR just because of the kind of real estate we have. We have zero drive-thrus,” said Randy Garutti, Shake Shack CEO. As the brand considers their options moving forward, plans are in the works to create something similar to the Chipotlanes, dubbed “Shack Tracks,” that will improve flow and encourage pre-ordering. Although some Shake Shack locations have reopened with in-store ordering, digital orders still accounted for 60% of total Shake Shack sales, which could indicate strong interest from consumers in easier pick-up and drive-thru options.
Panera And Starbucks Emphasize Their Drive-Thru And Pick-Up Options
Panera, which has experienced huge success with its MyPanera+ Coffee subscription, gaining nearly 700,000 subscribers this summer alone, plans to continue meeting consumer demand with more drive-thru locations. “I'm a big believer that drive-thrus are going to continue to be very important,” said Niren Chaudhary, CEO of Panera.
Similarly, Starbucks is making plans to emphasize its mobile pick-up options. “Over the next 18 months, Starbucks will increase convenience-led formats in company-operated locations with drive-thru and curbside pickup options, as well as Starbucks Pickup locations,” said Starbucks CEO Kevin Johnson in a statement about the brand’s changing priorities. Though accelerated by COVID-19, the new emphasis on pick-up was in the works prior to the pandemic, particularly since 80% of Starbucks transactions in the U.S. were “on-the-go, driven in part by the ability to order and pay ahead using the Starbucks app.”
The common theme for all these QSR restaurants, from Chipotle to Shake Shack to Starbucks, is significant app adoption and a desire to enhance the user experience to match current consumer needs and wants. That means encouraging app downloads are the first step to growth. Once on smartphones, QSR apps become a short-list for meal selection. Robust digital apps from brands also provide opportunities for location targeting, rewards programs and first-party data collection that allows brands to connect with consumers.
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