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6 Biggest Challenges Facing QSRs in 2017

6 Biggest Challenges Facing QSRs in 2017

Without a doubt, some of the biggest trends in restaurant marketing from 2016 will keep on gaining momentum in 2017.

Essentially, the overall experience that a restaurant delivers will increasingly become a “make it or break it” factor for restaurants in a growingly competitive environment. Restaurants that offer experiences instead of just food will have an edge when it comes to building that loyal community of repeat customers, which is the core of any sustainable business.  

The consumers’ increasing reliance on digital devices is also one of the trends that is with us to stay. Technological solutions, such as in-store kiosks, mobile payments and ordering applications will continue to grow. One survey showed that 75% of consumers will first view menus on their smartphones before trying a new restaurant.

Customer loyalty will matter even more in 2017 as QSRs and fast casual restaurants will face tough challenges.  We compiled a list of the top 6 challenges facing quick service and fast casual restaurants in 2017 to help you prepare for what lies ahead.

 1. Growing Importance of Customer Experiences

As we wrote recently, QSRs and fast casual restaurants battle competitors not just from within their industry but also from without. Who would have thought several years ago that convenience stores would pose a threat to restaurants? But with offering quick meal options and even limited seating convenience stores have tapped into QSR turf and were able to increase consumer foot traffic by 15 percent over the past five years – drawing nearly 4.9 billion visitors in 2016.

One of the biggest trends of 2016 that will keep on gaining momentum in the upcoming year is the growing importance of positive customer experiences. And that is where QSRs can beat the encroaching convenience stores to the curb. Creating outstanding customer experiences across all channels is one of main areas for QSRs to concentrate on in 2017 to gain a competitive edge.

2. Technology Arms Race

It’s no longer enough to simply flirt with technology in 2017. Many restaurants will discover that as consumers increasingly demand smooth omnichannel experiences, a heavy investment in technology becomes a requirement for a competitive QSR.

As consumers increasingly order and pay through their mobile devices, a digital ordering and a payment system is now an expectation.  Also, a digital loyalty program is not only expected, but should also be used for giving marketers rich personalized data on spending habits.

With so many technological solutions on the market, probably one of the biggest challenges will become choosing the right mix of technology to contribute to positive customer experiences.

3. Millennials and Gen Xers Are Tough to Impress

Young consumers are making just about every major or minor decision with the help of their smartphones – from shopping to dating to banking or buying a car. They have instant access to a vast trove of information at their fingertips to make informed choices. They are influenced by social media, texts from friends and web searches, so figuring out their preferences or influencing their choices is no easy trick.

In order to beat the competition, QSRs need to listen to consumers in order to discover and tap into missed revenue opportunities.  All customer data should be carefully analyzed and used for creating personalized experiences that consumers now expect in exchange for us collecting their data in the first place.

Understanding your consumers and adjusting the experience based on their preferences is going to become a major challenge for many QSRs.

 4. Omnichannel Experience Challenge

QSRs need to be able to offer an omnichannel experience that takes customers on a seamless journey.

And the most important destination of that journey is the in-store experience. Why? The physical location offers opportunities for consumer engagement that can’t be duplicated in the digital world.

For example, Domino’s Pizza in the Netherlands needed help keeping consumers engaged while waiting in-store for their orders. They placed a large screen and used it to challenge consumers to play a competitive and addictive multiplayer casual game on their mobile phones. As a result they were able to significantly improve the overall customer experience and increase brand loyalty.

5. Consumers Want Highly-personalized Experiences

Millennials, in particular, look for value and the whole experience, rather than just considered the quality of the food. If a brand can hit the nail on the head with regards to customer experiences, they can turn those young consumers into loyal customers  who will recommend a QSR or fast casual to their friends.

On top of a personalized experience, consumers also want their food delivered fast and their orders to be accurate, and they want this consistently. It’s a lot of pressure for restaurants. QSRs and fast casuals that deliver consistent, personalized customer service will increase consumer satisfaction.

6. Earning Loyalty Isn’t Easy

Maintaining the loyalty of consumers is getting tougher, and that is one of the biggest challenges facing QSRs today. After all, multiple analyses show that not only it costs more to acquire new customers than to keep the ones you already have, but repeat visitors also generate a disproportionately large chunk of a restaurant’s revenue.

While loyalty programs are a great way to encourage repeat visits, in 2017 the importance of the overall customer experience will come to the forefront as the most important factor in driving loyalty.

That is why a loyalty program that incorporates gamification intensifies the connection with consumers and gives them a reason to consider your QSR over many others. By connecting gamified experiences with a loyalty program, a QSR can revive dormant loyalty program members and prompt new consumers to also participate, while at the same time enhancing the overall customer experience in your restaurant

Customer experience is the key

All of the above mentioned challenges converge on a single point – creating outstanding customer experiences is essential for QSR and fast-casual restaurants.

With games that engage in-store consumers, QSRs and fast casual restaurants create positive experiences, enhance loyalty programs, create engagement and drive sales. Having an on-location gamification solution can be a make it or break it factor for many QSRs in 2017. On-site gamification makes a loyalty program appealing by introducing game mechanics and making the whole process of gaining loyalty points and rewards, exciting and fun.

If you want to overcome the six challenges with on-location gamification, Click here to subscribe to our blog!

Adir Zimerman

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