Throw a stone in the water and watch the ripples radiate and grow. Even the smallest shift can have a seismic impact down the road. This is the story of the modern-day food service industry. Over the last few years, numerous societal factors have led to an era of unprecedented and radical change amongst eateries, restaurants, cafes, and other dining venues worldwide.
Technological advancements and solutions have risen to meet the industry's present-day challenges and, in turn, have proven themselves to be capable of making some pretty big ripples. Take digital payments, for example.
Digital payment methods have radically increased in market presence over the last few years, and they are rapidly becoming the de facto payment method for venues of all shapes and sizes across the globe. With that in mind, let's see how digital payments compare to their older cousin, more traditional physical payment methods.
Digital payments vs. physical payments
What defines the term "digital payments?" Before we venture any further, let's define what digital payments are so that we can compare them to their physical counterparts.
It helps to think of digital versus physical payments occurring along a spectrum. Physical payments include tender types such as:
- Money order
Conversely, digital payments include:
- Credit or debit cards
- Mobile apps such as PayPal or Google Pay
- QR code payment methods
A case could be made that paying by credit card with an actual member of the waitstaff also constitutes a physical payment method, but for our purposes here, credit and debit payments fit ideally with automated, digital payments.
Nomenclature aside, what are the key benefits of implementing digital payment methods in your establishment, and why should you make that shift post-haste?
The benefits of shifting to digital payment methods
Today's restaurant patrons have a very different idea of what the dining experience should look like in comparison to the patrons of yesteryear. A transformative wave, led in large part by technologies such as digital ordering and payment methods, QR code menus, and robust customer relationship management (CRM) software, has helped usher in a new customer experience.
Rather than being a barrier to entry, statistics point to technology as a gateway that increases customer interaction with your brand. For example, Modern Restaurant Management reports that 82% of customers today prefer technology such as digital payments because it is safer, hygienic, and more convenient. Add to that Hospitality Tech's digital payments report, which found 84% of all consumers want digital payment options at their favourite venues.
One thing is for certain: the industry is moving toward more and more digital integration. Restaurants, cafes, and eateries should prepare now to pivot —or watch their market parity erode. Need more reasons to make the shift? Here are the top benefits of implementing digital payments into your establishment.
1. Digital payments are more hygienic
We're living in a post-COVID world where the rules of social engagement have forever changed. Restaurants and eateries have always pledged a high level of fidelity to hygiene practices. Following the pandemic, there's been an increased focus on hygiene amongst the general public, especially when it comes to social situations. From plexiglass dividers at the grocery store, to specially made kickplates that allow you to open a door hands-free and hand sanitiser at all points in between, merchants, business owners, and entrepreneurs have had to make accommodations for their customers.
The hands-free nature of digital payments, specifically those initiated through methods like QR code menus, presents the ultimate safety precaution. No cash changes hands, and it's easy to maintain social distancing.
2. They promote convenience and a superior customer experience
Let's take a minute to talk about customer preference, especially as it relates to the traditional restaurant dining experience. Think about the way that the restaurant and its staff pace each interaction. The host/ hostess seats you, then the waitstaff brings you a menu and takes your drink order. Oftentimes, there is dead space between when you are first seated and when the waitstaff takes your order. Downtime can also exist in between finishing your meal and settling the check.
Customer convenience is one of the core benefits inherent in digital payments. With digital payments, your customers control the pacing of the meal at critical junctures. In turn, this frees up your staff to engage the customers in a richer and more authentic manner.
The modern customer is all about a contactless experience that promotes improved hygiene, as well as a frictionless experience that is respectful of the customer's time. This level of convenience is central to a superior customer experience. A good customer experience, in turn, will keep patrons coming to your establishment time and time again.
3. Digital payments appeal to young demographics with purchasing power
Millennials, and the upcoming Generation Z, are a huge demographic with an ever-increasing amount of purchasing power. Their habits and values stand to impact the global restaurant industry in some exciting ways. One of those ways is through technology.
According to Pymnts, somewhere between 27-30% of millennials are technologically savvy, meaning not only do they transact business using mobile devices, but they also own multiple different devices with these capabilities. It's important for entrepreneurs to keep their preferences in mind when designing a dining experience.
4. Digital payments help foster an ongoing relationship with your customers
One key benefit of digital payment options is the way that those methods integrate seamlessly with your existing tech stack, i.e. the software solutions that drive your eatery. One of the most important solutions that you can implement, other than digital payments themselves, is a CRM.
The CRM helps you pull high-value data, such as spending habits, customer preferences, and demographic information, from each transaction. With customer data in hand, you can easily build loyalty programs designed to garner repeat business from your best customers.
5. Digital payments through QR codes are cost-efficient
More adaptable, digital payment methods have become an industry standard across the food service subsector. According to Business.com, 57% of all customers prefer using a digital method to order and pay for their food, whether dining in or picking up takeout. However, setting up a digital payment interface, either through your website or an individual app, can be a costly endeavour with a range of results.
There's another, more cost-efficient method for setting up your digital operation: QR codes. QR code menus can be configured to link out to your existing POS system, facilitating easy, inexpensive digital payment options guaranteed to please your customers.
6. Digital payments improve revenue
Digital payments are fast, convenient, and easy to use. Because they integrate so easily into the rest of your existing tech solutions, digital payments are a great revenue builder. You can sync your digital QR menu and point-of-sale system together so that customers can see high-quality images of your appetisers, drinks, entrees, and desserts, ordering whatever appeals to them in the moment. In turn, this will entice them to add items to their order.
Don't discount convenience as a key driver of consumer spending, either. By virtue of ease, customers that pay using digital methods are simply prone to spending more than those who pay with cash and have an instantly observable, finite tender.
Implementing digital payments in your venue
Time marches steadily onward. Industries change and mature. This is especially true for the food service industry. A series of watershed moments experienced in rapid succession have propelled the industry forward.
Shifting away from traditional payments and embracing digital payments may be the most beneficial thing you can implement for the future of your establishment. Want a head start on your digital transformation? Mr Yum can help you grow your business. Contact us today to get started.