The coronavirus outbreak has affected the global economy worst, and as per the expert’s report, we are facing a global recession. Aviation, tourism, and restaurant are the most affected sectors by the lockdown imposed to handle the Covid-19 situation. The food and restaurant industry has also taken a bad hit as consumers now prefer online ordering over dine-in.
The restaurant industry is expected to bear a loss of $240 billion by the year 2020, as per the National Restaurant Association. As we don’t have any clue when the situation gets normal; hence we have to accept new norms issued by the Government. Moreover, people are confined inside their homes and prefer online food ordering in order to stay safe and secure.
From the last decade, the restaurant industry is evolving. From innovative food delivery apps such as GrubHub, Zomato, Postmates, and JustEat to the concept of ghost kitchens and virtual kitchens- the restaurant industry is adapting digital solutions to deliver a seamless experience to its consumers.
According to a recent report, it is believed that more than 90% of restaurants admitted that they had seen significant growth in their business ever since they have embraced technology solutions in their business. To combat pandemic effects, the restaurant industry relies upon technology solutions as this is the only option that will help them to thrive in the coming years.
Let’s discuss in detail how the restaurant industry remodeled through the digital medium.
Emerging Trends Remodeled The Restaurant Industry
A global restaurant industry that is now worth almost $900 billion, and it continually keeps evolving as per the market trends and consumer’s preferences. Today, consumers prioritize convenience over anything else. Probably, this is why more and more food business owners are embracing digital solutions into their business. Here are the most important trends you need to know to survive and thrive in this new and challenging climate.
# Rise Of Online Food Ordering
The above chart shows that the volume of online orders will surpass offline orders soon. In the year 2018, Frost and Sullivan projected that the online food delivery market generated $82 billion in revenue. Statistics show that this number will double by 2023. (source)
Online delivery apps such as GrubHub, Zomato, Doordash, Delivery Hero, etc., help restaurants increase their revenue as they can now attract more consumers while spending less. As per the National Restaurant Association, four in five US consumers order food online at least once a week.
Some exciting facts and figures will blow your mind; let’s have a look at some interesting stats,
- Revenue in the online food delivery sector will reach $26.5 billion by the year 2021.
- Age between 25-34 is the largest segment to use online food delivery apps.
- More than 66% of restaurants believe that they have experienced significant sales growth since they have enabled doorstep delivery.
The simple reason behind this massive growth is convenience. Yes, online food ordering apps allow consumers to place orders anytime, anywhere. Moreover, they can track their orders in real-time and make payments as per their preferences.
Furthermore, restaurants shutting down, people can not visit the actual place. They are highly relying on online food delivery apps such as Zomato, UberEats, GrubHub, and many more. And this habit will continue to grow even after a pandemic because these apps offer comfort. Moreover, attractive deals and perks encourage customers to place and track their orders online.
GenZ consumers are already enthused by doorstep delivery as it saves time and enables them to enjoy a delicious meal as per their preferences. Ts is the reason why more and more restaurant business owners are investing in ubereats app clone as it reaps multiple benefits and maximizes profitability.
# Social Media Revolutionizing Restaurant Industry
In today’s digital world, most businesses, whether they are startups or well-established, have a persistent presence on social media sites. Social media marketing plays an important role and an extremely powerful tool for promoting your restaurant business. It also allows you to establish good relations with consumers. If your restaurant business is not leveraging social media, there might be a chance to collapse your business in the coming years.
As per the eMarketer, here you can see social media users are increasing by leaps and bounds, and more than 65% of the consumers trust social media reviews before placing an order from any restaurant. (source)
In the year 2009, more than 75% of restaurants were listed on Yelp.
This is why we can say that social media has revolutionized the restaurant industry as it allows them to establish a relationship with consumers in a personalized way and upscale their revenue.
# Rise of Ghost Kitchens
Due to the Corona Pandemic, people no longer want to visit restaurants; this can be a significant downturn for restaurant business owners. To combat this situation and avoid unnecessary expenses, the concept of Ghost Kitchen came into existence. Ghost kitchens are also known as Virtual kitchens, Cloud kitchens, and Dark kitchens.
In short, delivery only or takeaway restaurants are known as ghost or cloud kitchens. The significant benefit of starting a cloud kitchen is you no longer need to spend money on hospitality or interior. It saves maintenance costs and allows you to focus on other important tasks. All you need an online delivery solution that lets you manage orders and deliver them in real-time.
We already know that restaurants are suffering a lot due to the pandemic; by starting ghost kitchens, they can eliminate some kind of fixed cost such as rent, salary to staff, and much more. Furthermore, if you have embraced an online delivery solution, you can manage everything using a single dashboard, including customer details, order details, delivery providers, and much more. With this, restaurant owners will get more benefits and can utilize these funds somewhere else.
# Contactless Delivery and Payment
Until a couple of months ago, we have not heard the words “contactless delivery” and “contactless payment.” But now it seems these terms are here to stay for a long time. However, with the unprecedented arrival of the Corona outbreak, we should avoid direct contact in order to prevent virus spread.
On the other hand, restaurants are going digital as they can not provide a dine-in facility; they have adopted contactless delivery and payment approach to reduce the risk of virus spread. They have adopted a new way of delivering an order that is called “contactless delivery.”
Customers can place an order through a website or application. They can add dishes they want, make a payment from the options. Also, users can choose the contactless delivery option. This option is not available for users who opt for cash on delivery. The delivery provider will leave the parcel at the user’s doorstep and notify the customer digitally.
In the same way, contactless payment also has gained immense popularity. According to a recent survey, more than 35% of consumers have started using digital payment solutions since the outbreak began. And 75% of users are likely to continue this payment method even after the pandemic ends.
E-wallets, debit/credit cards, or mobile wallet options allow uses to make payments swiftly and securely. There are several popular mobile wallets available in the market, such as Apple Pay, Google Pay, Mastercard, Paytm, and many more.
Due to the pandemic, contactless payments gain popularity, banks and financial institutions worldwide have increased their CVM limit so that users can make payment easily during the lockdown with utmost safety.
Restaurant Industry Cope Up with Shutting Down
The Corona outbreak has had a long-lasting impact on the restaurant industry across the globe. We can see profitability has fallen by nearly 75%, and millions of people have lost their jobs. Keeping in mind the current situation, the entire restaurant industry globally has adopted digital solutions to address and overcome the Corona outbreak’s impact.
Restaurant business owners across the globe have implemented a doorstep delivery and take away model to serve customers and ensure business growth during this challenging time. By adopting digital ordering solutions, consumers can place an order and get it delivered at their doorstep.
The rapid adoption of digital solutions benefit the restaurant business and thrive during this challenging time. Online solutions offer several benefits such as,
- Increase customer retention ratio
- Build an online presence
- Increase profitability
- Enhanced personalization and customer experience
- Eliminate fixed costs such as rent, salary, etc.
We know that the overall GDP decline is quite disappointing for the restaurant industry. Though, the increasing digital ordering trend may prevent many restaurants from shutting down.
The coronavirus has adversely affected our social and personal well-being. Although it is also true that it has been one of the major keys of digitalization across the world. Online food ordering, digital payments, contactless delivery, etc., have emerged as a strong way. Those are good for the restaurant industry to thrive in the post COVID world.
In the future, we might see an acceleration in the adoption of digital solutions across the entire restaurant industry as it will also disrupt the mobile app development industry.