Virtual kitchens give restaurants control

While ghost kitchens were a given during the quarantine, the return of on-site meals challenged virtual kitchens to rethink their model. Restaurants are no longer content with remote, hard-to-reach kitchens in warehouses far from consumers’ homes, and they can no longer meet their needs with one-size-fits-all solutions that treat all brands the same.

“Restaurants often have this misplaced reputation for slowly adopting technology, and we’ve seen the exact opposite: the partner restaurants we work with are incredibly innovative and receptive to new technologies, platforms and ideas,” Ken Chong, co-founder . and CEO of catering solutions provider All Day Kitchens and former product manager at Uber, told PYMNTS in an interview. “So we’ve just seen a wave of excitement in terms of… really pushing the boundaries of what they can do and how they plan to serve their customers digitally. “

Earlier in the fall, All Day Kitchens announced a $ 65 million Series C fundraiser; in the past year, the number of the company’s partner restaurants has quadrupled and locations have doubled.

Certainly, digital control has become more and more popular in recent years. Research of the PYMNTS study “The Bring-It-to-Me Economy: How Online Marketplaces And Aggregators Drive Omnichannel Commerce”, created in collaboration with Carat de Fiserv – which included a balanced census survey of over 5,200 consumers Americans on how their buying habits have changed since the start of the pandemic – 58% of consumers order food from restaurants online more often than before March 2020. In addition, this figure rises to about two-thirds for young consumers, including Gen Z, Millennials and Bridge Millennials. .

Read more: Bring It On Me Economy Grows As Consumers Embrace Home-Centered Lifestyles

One size does not fit all

As restaurants have become more digital savvy, their needs have become more and more specific.

“This is one of the things we hear a lot about from our partner restaurants – we want to control both our digital presence and our menus,” Chong said. “So we give them flexibility in every way we can whenever we make a design decision. “

In fact, even large restaurant technology companies – those who have built their customer base by offering bundled solutions to meet the needs of as many restaurants as possible – have noted this demand for flexibility, allowing restaurants to choose the best products. more relevant to them. . For example, earlier this month, DoorDash and Grubhub both announced features that make it easier for restaurants to fill orders using a combination of their own drivers and delivery service drivers.

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Chong’s remarks echo those of Steve Simoni, CEO of contactless ordering and payment technology provider Bbot. In an interview with PYMNTS, he shared his expectation that as restaurants become more widely available in digital spaces, solution providers will continue to offer more of their services on an ad hoc basis, making them better able to adapt to the evolving digital needs of restaurants.

“Pick your own adventure is the trend now, and that’s why it’s more important than ever for systems integrators to get it right,” he said.

The new ghost kitchen

In its early iterations, the ghost kitchen model promised low-cost real estate, locating the physical site away from dense urban centers. Now, given the shortage of drivers and the fact that many foods don’t hold up well when transported long distances, these satellite locations pose major limitations for many restaurants.

“Restaurants told us that they really weren’t looking for another owner, or that they didn’t want to be hidden away in a warehouse in a light industrial zone,” Chong said. “They want to be closer to where customers live and work. “

Of course, not all industry insiders are so convinced of the long-term viability of ghost kitchens, even with these changes. Steve Fredette, president and co-founder of catering software company Toast, noted in an interview with PYMNTS that it may be too early to say what the future holds for these delivery-only locations. “You can take meal kits as an example, where a lot of businesses have grown and been successful quickly and then fail. So with ghost kitchens or cloud kitchens, the question is, how important will they be in the long run. “

See Also: Toast President Says Ghost Kitchens No Replace On-Site Dining Experience

The digital future of restaurants

Whether or not the ghost kitchen model does it for the long haul, digital control is clearly here to stay. PYMNTS 2021 Restaurant Readiness Index research, created in collaboration with Paytronix, reveals 16% of restaurant sales are now generated by third-party aggregators, while 10% are from own online delivery ordering platforms restaurants. In addition, 48% of consumers and 53% of restaurant managers see the ability to order online as an important element in the future success of restaurants.

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Additionally, consumers who order online do so more frequently than those who order through more traditional channels. Researching the July / August edition of PYMNTS ‘Delivering on Restaurant Rewards report, also created in conjunction with Paytronix – which surveyed over 2,000 U.S. adults about their restaurant ordering behaviors and loyalty program usage – found that 30% of restaurant customers who order from third-party aggregators do so at least twice a week, while only 15-20% of customers who dine there do so frequently.

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“We have increased our income about 18 times since pre-COVID,” Chong said. “As we are so early in this habit of consumption [digital ordering] really take off, we have noticed that it continues to grow and stay with consumers and restaurant partners.

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NEW PYMNTS DATA: 2021 HOLIDAY SHOPPING OUTLOOK

On: It’s almost time for the holiday shopping season, and nearly 90% of American consumers plan to do at least some of their purchases online, up 13% from 2020. The 2021 Holiday Shopping Outlook, PYMNTS surveyed over 3,600 consumers to find out more about what drives online sales this holiday season and the impact of product availability and personalized rewards on merchant preferences.

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