1. Mapping the Restaurant Technology Landscape Midwest Foodservice Expo
March 13, | Milwaukee, WI
Annika Stensson
Director, Research Communications
National Restaurant Association
@WeRRestaurants
/RestaurantDotOrg
Restaurant.org/Research
/NationalRestaurantAssociation

2. Technology trends - Consumers Technology trends - Operators
Agenda
Restaurant industry 2017
Technology trends - Consumers
Technology trends - Operators

3. RESTAURANT INDUSTRY 2017

4. DEFINITION: “Restaurant Industry” “Food Away from Home”
All meals/snacks prepared away from home, including all takeout meals and beverages.

5. $799 billion 14.7 million 1+ million
Restaurant Industry 2017
Sales:
Employees:
Locations:
$799
billion
14.7
million 1+
million
Source: National Restaurant Association

6. An Economic Powerhouse
Annual sales are larger than 90% of the world’s economies.
Sales projected to advance by $33 billion in 2017 – roughly double Hollywood’s annual domestic box office sales.

7. Where Do Consumers Spend?
SPENDING CATEGORY
PERCENT OF TOTAL
Housing
33%
Transportation
17%
Food
13%
Insurance/pensions
11%
Health care 8%
Entertainment 5%
Contributions 3%
Clothing
Other 7%
Total
100%
Source: Bureau of Labor Statistics, 2015 Consumer Expenditure Survey; National Restaurant Association

8. Restaurant Industry’s Share of the Food Dollar
1955
Present
1955: 25%
Now: 48%
Source: National Restaurant Association

9. Top Challenges Facing Operators
JANUARY 2016
Recruiting Employees %
Labor Costs %
Sales Volume %
The Economy %
Government %
JANUARY 2014
Food Costs %
Government %
Sales Volume %
Labor Costs %
Recruiting Employees %
JANUARY 2015
Government %
The Economy %
Recruiting Employees %
Labor Costs %
Sales Volume %
Source: National Restaurant Association, Restaurant Industry Tracking Survey

10. Restaurants are Extremely Labor Intensive
Average sales per employee, 2015
Eating & Drinking Places
$56,000
Grocery Stores
$226,000
Gasoline Service Stations
$478,000
Auto Dealers
$769,000
Source: National Restaurant Association, based on Bureau of Labor Statistics and US Census Bureau data

11. Average Annual Percent Change in Output per Labor Hour: 2005 to 2015
Labor Productivity in Restaurants Remained Flat in Recent Years
Average Annual Percent Change in Output per Labor Hour: 2005 to 2015
Source: Bureau of Labor Statistics

12. TECHNOLOGY TRENDS - CONSUMERS

13. Tech Influences
Consumers who say availability of technology makes them choose one restaurant over another.
Source: National Restaurant Association, 2016

14. 1/5 Want to Go Human-Free
Consumers who prefer to use technology rather
than interact with restaurant staff
Source: National Restaurant Association, 2016

15. Human Service Still Important
Consumers’ primary reason for not using technology options when dining out, or ordering takeout or delivery
Source: National Restaurant Association, 2016

16. In-Store Tech Usage Have used Willing to use Free Wi-Fi 55% 69%
Consumers who have used these options in the last year; consumers who would be willing to use these options in the future when available
Have used
Willing to use
Free Wi-Fi
55%
69%
Tableside payment
43%
64%
Electronic ordering station (tableservice)
33%
54%
Touch-screen ordering kiosk (QSR)
32%
59%
None
29%
18%
Source: National Restaurant Association, 2016

17. Smartphone/Tablet Usage
Consumers who own or regularly use a smartphone or tablet
All adults
77%
18-34
96%
35-44
91%
45-54
80%
55-64
62%
65+
47%
Source: National Restaurant Association, 2016

18. Restaurant Smartphone Tech
Consumers who use smartphones or tablets for these activities occasionally
Percent of adults
Look up restaurant locations, directions and hours
88%
Look at menus
72%
Order takeout or delivery
63%
Read online reviews
58%
Use loyalty programs and rewards
56%
Make reservations
46%
Look up restaurant nutrition information
44%
Pay for meals
34%
Source: National Restaurant Association, 2016 – Base own/use smartphone/tablet

19. Mobile Payment Acceptance In Mixed
Consumers who would pay restaurant or bar tabs via smartphone app if offered
Source: National Restaurant Association, 2014, 2015, 2016 – Base own/use smartphone/tablet

20. Future Acceptance?
Consumers who say they like the idea of these technologies in restaurants
Source: National Restaurant Association, 2016

21. Technology Is Growing
66% of consumers say tech options increase convenience
61% say tech options speed up service
56% say tech options increase order accuracy
37% of consumers report technology makes restaurant visits and
ordering more complicated
Source: National Restaurant Association, 2016

22. Why Is It Complicated?
Consumers who say the following are reasons technology complicates restaurant visits and ordering
Source: National Restaurant Association, 2016 – Base = consumers who say technology makes restaurant interaction more complicated

23. What’s In It for Restaurateurs?
35% of consumers say tech options make dining out more fun
30% say tech options make them dine out or order takeout/delivery more often
26% say tech options make them choose one restaurant over another
Source: National Restaurant Association, 2016

24. Tech Fatigue?
Consumers who agree with the following statements about technology in restaurants
Source: National Restaurant Association, 2014, 2015, 2016

25. TECHNOLOGY TRENDS - OPERATORS

26. Current Tech Adoption Industry Segment Total Tableservice
Limited-service
POS or electronic cash register system
81%
78%
83%
Website
79%
Wi-Fi for guests
68%
71%
64%
Touch-screen ordering kiosks or stations
42%
N/A
Online ordering for takeout or delivery
37%
25%
49%
Smartphone app
34%
18%
50%
Mobile payment
32%
15%
Online reservations
Electronic or digital menu boards
21%
Tabletop ordering, or payment device or station
20%
Source: National Restaurant Association, Restaurant Technology Survey 2016

27. Current Tech Adoption Ownership Category Total Independent
Franchisee/ Chain
POS or electronic cash register system
81%
69%
94%
Website
73%
89%
Wi-Fi for guests
68%
Touch-screen ordering kiosks or stations
42%
30%
47%
Online ordering for takeout or delivery
37%
20%
54%
Smartphone app
34%
14%
55%
Mobile payment
32%
17%
Online reservations
25%
21%
Electronic or digital menu boards
15%
Tabletop ordering, or payment device or station
28%
Source: National Restaurant Association, Restaurant Technology Survey 2016

28. Features of POS Systems
Source: National Restaurant Association, Restaurant Technology Survey 2016 – Base use POS system

29. Proprietary System vs. Service
2 in 3 tableservice restaurants offering online reservations use a service; 1 in 3 use a proprietary system.
Half of tableservice restaurants offering online ordering use a proprietary system; 2 in 5 use a service.
3 in 5 limited-service restaurants offering online ordering use a proprietary system; a quarter use a service.
Source: National Restaurant Association, Restaurant Technology Survey 2016

30. Mobile Payment Type
More than half of tableservice restaurants accepting mobile payment use NFC or Bluetooth; a quarter use in-app/frictionless.
3 in 5 limited-service restaurants accepting mobile payment use NFC or Bluetooth; 1 in 10 use in-app/frictionless.
Source: National Restaurant Association, Restaurant Technology Survey 2016

31. Smartphone App Features
Source: National Restaurant Association, Restaurant Technology Survey 2016 – Base has smartphone app

32. Reason for Developing Smartphone App
Source: National Restaurant Association, Restaurant Technology Survey 2016 – Base has smartphone app

33. Reason for Developing Smartphone App
Industry Segment
Ownership Category
Source: National Restaurant Association, Restaurant Technology Survey 2016 – Base has smartphone app

34. Top Benefit to Using Customer-Facing Technology
Source: National Restaurant Association, Restaurant Technology Survey 2016

35. BOH Technology Use Industry Segment Ownership Category
Source: National Restaurant Association, Restaurant Technology Survey 2016

36. Devoting More Resources to Tech
42% of restaurant operators say they’ll devote more resources
to technology in 2016 than in 2015.
Source: National Restaurant Association, Restaurant Technology Survey 2016

37. Lagging vs. Leading Edge in Tech Use
Source: National Restaurant Association, Restaurant Technology Survey 2016

38. Lagging vs. Leading Edge in Tech Use
Industry Segment
Ownership Category
Source: National Restaurant Association, Restaurant Technology Survey 2016

39. Most Important Area of Tech Development in Next 5 Years
Source: National Restaurant Association, Restaurant Technology Survey 2016

40. if they were available to them today
Future Adoption?
Restaurant operators who say they would consider adding the following technologies
if they were available to them today
Source: National Restaurant Association, Restaurant Technology Survey 2016

41. The Future Is Not Quite Now
Restaurant operators’ sentiments about the following technologies
Source: National Restaurant Association, 2016

42. Barriers to Adding More Tech
Source: National Restaurant Association, Restaurant Technology Survey 2016

43. Restaurant Operators’ Agreement with Statements on Technology
83%
83%
83%
81%
72%
47%
Source: National Restaurant Association, Restaurant Technology Survey 2016

44. Summary
Interest is growing among consumers, but there’s some hesitation around cutting-edge tech.
Adoption is growing among restaurants.
Cost remains a barrier.
Operators and consumers largely on board with technology, but some still believe it complicates interaction.

45. Mapping the Restaurant Technology Landscape
Restaurant Innovation Summit
September 15, | Austin, TX
Annika Stensson
Director, Research Communications
National Restaurant Association
@WeRRestaurants
/RestaurantDotOrg
Restaurant.org/Research
/NationalRestaurantAssociation