May 23, 2014

Focus on Mobile Technology at NRA 2014

BJRI, BKW, BWLD, CMG, GRUB, KO, MCD, MIDD, PEP, PZZI, TXRH, WEN, YUM
By Justin Pillette
Overall attendance at the NRA Show was strong this year, helped by heightened interest in technological advancements across the industry, especially in mobile technology.

Overall attendance at the National Restaurant Association (NRA) Show in Chicago (May 17-20) was roughly in line with last year’s numbers, though the mood and number of attendees willing to start up new business was better, according to most vendors who spoke with OTR Global. “This is the best show for us in three years. We’re seeing more serious interest this year,” one said.

Mobile Technology
Technology designed to bring every aspect of restaurant operations to smartphones and tablets -- from marketing to collecting orders and payment from customers, workforce management and loyalty programs -- was one of the primary themes at this year’s show.

With the rapid increase in the number of large restaurant operators offering, or planning to offer mobile ordering apps (recent entrants include Yum Brands Inc.’s Taco Bell, Burger King Worldwide Inc. and The Wendy’s Co.), there was a noticeable proliferation of vendors offering mobile ordering and payment apps at the show this year. GrubHub Inc. and EatStreet Inc. were among the most visible mobile-ordering providers. However, while the use of mobile ordering is increasing rapidly, many large restaurant operators are choosing to develop their own mobile-ordering platforms in-house to maintain control of data, and third-party vendors are focusing more on connecting customers with smaller, local operators offering takeout or in-store pickup for a commission on the order (GrubHub gets 13%).

Mobile payment providers, such as SCVNGR Inc.'s LevelUp and Paydiant Inc., also had a strong presence in the Technology Pavilion and were seeing a steady stream of attendees interested in mobile payment options, which can attract larger operators interested in a secure, turnkey solution that limits liability. During an education session that touched on mobile payments, an executive from a mid-sized casual-dining chain noted his company had been sued by customers because of a breach of their in-house payment database, which led them to seek out a third-party provider. Paydiant, whose customers include Doctor’s Associates Inc.’s Subway, work directly with banks, such as Capital One Financial Corp., to enable a seamless connection between the customer, restaurant operator and bank.

Workforce management, training and testing also are moving more toward mobile devices. Redbookconnect.com Inc., which separated itself from the competition with a 1,200-square-foot booth in the South Hall (the Technology Pavilion was located in the North Hall) and a Harley Davidson Inc. giveaway, Altametrics Inc. and PeopleMatter were some of the most visible workforce-management providers at the show. A representative from Red Book Connect, whose clients include McDonald’s Corp., BJ’s Restaurants Inc. and Texas Roadhouse Inc., said, “Everybody is on their mobile devices these days, and they don’t want to be tied down to a desk. One of the big things now is doing your [employee] training from your mobile device using videos. We can set it up however they want, so the employee is tested along the way if that’s what they want, for example -- completely interactive. A lot of the bigger companies are taking advantage of that, and their employees love it, especially the younger ones.”

Tabletop Tablets
Ziosk Inc. and NTN Buzztime Inc. (both mentioned in OTR Global reports on Brinker International Inc.’s Chili’s and Buffalo Wild Wings Inc.) had well-attended booths in the Technology Pavilion, with Ziosk featuring its new camera technology that allows customers to share pictures via social media (it is unclear if Chili’s will be receiving the newest devices in stores already equipped), and Buzztime introducing its BEOND all-in-one social, mobile and entertainment platform. In an education session titled “The In-Store Experience,” one executive from a mid-sized QSR operator said he has been very impressed with the performance of in-store kiosks. He said the company ran a test with a store using only kiosks for ordering (no cashiers) and found customers spent an average 20% more at the kiosks than at their stores with only cashiers. Another panelist said his company had found tabletop tablets generated 50% more incremental sales (add-on/suggestive sales) than servers at his casual-dining restaurants. “People prefer machines,” he said.

Pizza Equipment
In other areas, Middleby Corp.’s TurboChef Technologies 800-degree Fire counter-top convection oven, featured in the Kitchen Innovations pavilion, cooks pizzas up to 14 inches in as little as 90 seconds and addresses a rapidly rising need in the industry as fast-casual pizza chains, including Chipotle Mexican Grill Inc.’s Pizzeria Locale, Buffalo Wild Wings’ PizzaRev, Pizza Inn Holdings Inc.'s Pie Five Pizza Co. (which uses TurboChef’s pizza ovens) and Blaze Pizza LLC, begin to take off in popularity.

Pepsi’s Spire
In response to the success of The Coca-Cola Co.’s Freestyle, PepsiCo Inc. this year unveiled Spire, a new machine that offers more than 1,000 drink combinations and is currently available in 10 states. The machine, which comes in several sizes (counter-top and freestanding) has tested successfully in KFC, Pizza Hut, Taco Bell and Buffalo Wild Wings locations. Spire is different from the Freestyle in that it premixes the drink for the customer rather than customers mixing their own. In addition, the more advanced units send real-time feedback on customers’ drink preferences back to Pepsi. In the center of the booth, chefs prepared different products from Pepsi food companies paired with different Pepsi drinks. The booth was very busy with lots of energy, a night-and-day improvement compared with the sleepy atmosphere at last year’s show. However, while the machine is fun to operate and will undoubtedly turn heads, it comes on the heels of waning excitement over the Freestyle and growing reports of dissatisfaction with the added wait times, mess and expense caused by customer experimentation.