Where operators plan to invest in tech

The National Restaurant Association’s Restaurant Technology Landscape Report 2024 surveyed operators and consumers to gain insights on where technology investment is happening today and how receptive diners are to these technologies. 

In the survey, three-quarters of operators (76%) said they expected technology to give them a competitive edge. However, a quarter (23%) worry that their operation is lagging behind in adoption of new technologies, while only 13% believe they are on the cutting edge. Operators plan to invest in tech to enhance the customer experience (60%) and to boost productivity or efficiency in the service area (55%) or kitchen (52%).
Here are operators’ top priorities for tech investments in 2024, per survey responses:

1. Digital marketing/location-based marketing. Promoting their restaurant online to attract and keep customers is an investment focus for almost two-thirds of respondents (64% of full-service operators, 62% of those in limited service). That can include social media profiles and ads, digital loyalty programs, email and phone-text marketing,  and search engine optimization to steer potential customers to the restaurant’s website—now including optimization of voice search. 

Then there’s location-based marketing, which literally meets consumers where they are, targeting potential customers based on their proximity to the restaurant. Learn more about the different forms of location-based marketing and their uses here and here. 

2. Loyalty/reward systems. Almost six in 10 operators surveyed plan to invest to keep their best customers coming back. Loyalty is currently a bigger priority in the chain-dominated limited-service segment (61% of operators polled) than for fullservice operators (52%). 

Loyalty and reward programs are well accepted by the dining public; 52% of consumers surveyed said they currently participate in a loyalty or reward program at a restaurant, coffee shop, snack place or deli, and almost all (96%) appreciate these programs because they help them get more for their dining dollars. 

Learn the latest about loyalty and reward programs here. Further tips on structuring a loyalty program are available here.

3. Back-office technologies. These include systems covering payroll, finance, tax compliance and food safety compliance. Just over half of operators (52%) said they plan to invest in back-office tech. Not surprisingly, labor management is a top priority, with 47% of operators (and 49% of those in limited service) saying they expect technology and automation to be increasingly adopted to deal with the labor shortage. Almost four in 10 operators (37%) expect to invest in automated labor management, recruitment and/or scheduling systems in 2024.

Learn more about the latest in tech to make hiring and employee retention easier here and here. Simplifying payroll accounting, potentially with the help of technology, is addressed here. Staff scheduling software is discussed here. There’s information about how artificial intelligence (AI) can now help with financial, inventory and performance measurement as well as staff scheduling here and here.
 
4. Inventory control and management. Better inventory management can reduce both food spoilage and internal theft. Managing inventory of food and supplies is a tech spending priority for just over half of those polled (52%). Integration of inventory management software with point of sale systems and linkage to vendors are highlighted in the wide-ranging technology discussion here. 

5. Point-of-sale (POS) systems. Technology to streamline the point of sale is a spending priority for around half of operators (48%), but it’s much more urgent for LSRs (53% of operators) than for fullservice (43%). Specifically, 42% of limited-service operators plan to invest in contactless or mobile pay technologies. 

Diners are comfortable with POS technology in restaurants. Most said they’re fine placing an order via a smartphone app (70% in limited-service, 63% in fullservice) or QR code (52% when dining in an LSR, 48% in table-service restaurant). In full-service restaurants, diners said they’d be willing to order via on a tablet at the table (60%), while in LSRs, patrons would order on a self-service electronic kiosk (65%) or by talking to a human order-taker via a video screen (58%). 

Consumers are also willing to handle their bill via contactless or mobile payment (68% in LSRs, 62% in FSRs), or through a smartphone app (65% in LSRs, 55% in FSRs), digital wallet (61% in LSRs, 57% in FSRs) or QR code (48% in LSRs, 46% in FSRs). In LSRs, 68% would be willing to place their order and pay in advance on the restaurant website, and 63% would pay via a kiosk; in FSRs, 65% would be willing to pay via a tableside tablet. 

Ways that POS investments can boost efficiency and revenue are highlighted in operator perspective profiles in the Technology Landscape Report. Rob Conti, SVP of information technology at the breakfast-focused full-service chain First Watch, highlighted its new system that imprints each customer’s check with a QR code that can be scanned  with a smartphone to enable payment via Apple Pay, Google Pay or a credit card. The 125,000 customers who used the feature in a week shortened their payment transaction time by an estimated 30 seconds, saving a total of 1,000-plus hours for themselves and restaurant staff, he said.

And Chef Erica Barrett, founder of Dough Boy Pizza Co., talked about her brand’s new POS system, which handles online orders from third-party delivery services and is integrated with digital menu boards that allow real-time changes in menus and pricing, as well as with self-ordering kiosks, which help with labor costs (just 11%-15% of sales because there are no cashiers) and order accuracy (fewer than 1% of orders come back). 

Learn more about POS systems here and here. 

Bottom line, per the report: Adopting the latest tech is somewhat more important in LSRs, where employee/customer dealings are limited and consumers may actually prefer the convenience of tech in their interactions, than in fullservice venues, where customers are open to enhanced convenience but engagement with staff remains an integral part of dining out.