QSR December 2022

DIGI TAL INNOVAT ION

food delivery. It combines online orders from different delivery providers in order to allow restaurants to improve services and customer satisfaction. Automation and AI technol ogy to help improve day-to-day operations is the future of the business, Xu says. He also notes that using smart technology like robots and drones for the distribution of food from warehouses and virtual kitchens is also becoming more popular. “In 2023 and beyond, we’ll see continued momentum for this smart device explosion, including increasing use of intelligent delivery robots and drones,” Xu says. “Additionally, we expect ghost kitchens to continue in popularity as the industry con tinues to seek efficiencies and grapple with staffing shortages.”

Nextbite in November 2021), to address the challenges of managing orders from multiple delivery services for independent restau rants—like his family’s famed Canter’s Deli— that lacked the ability to integrate into POS. “The biggest changes? Consumer digital adoption, operator engagement, and true and evident ROI for investment in technol ogy,” Post says what’s taken place across the pandemic. “We just completed 45 hours of in-home ethnographic interviews on food delivery. The in-home business has an un limited future with consumer expectations for seamless and informative digital engagement growing daily. We must continue to set the bar for UX higher and higher.” Going forward, Post expects the industry to see an increased interest in harnessing data gathered from customers to create a bet ter experience, including higher guest return rates and satisfaction. “This needs to be truly dynamic, daily input to maximize the opportu nity,” Post says. “Monthly look-back reporting is no longer sufficient.”

restaurant complexities increased to meet guests’ growing tastes. “We believe the pace of change will only accelerate, which is why Tim Hortons is highly focused on building, testing, and adopting digital technologies— both consumer-facing and at the restaurant level,” Sturm says. “At Tims, we and our franchise restaurant owners are embracing a bold digital mindset across every department and in practicality, everything we do. This in cludes, among countless other examples, an even greater focus on: advertising on digital/ social media in our marketing department, testing new back-of-house technologies to improve operations, and designing and evolving our restaurants in ways that encour age digital guest adoption.” In particular, Sturm is interested in the notion many retail consumer companies today derive a portion of revenues from “non-core” digital services. These have become easier and more cost efficient for consumer brands to integrate into their digital ecosystems. In large part, it’s a trend that owes to cloud technologies and “infrastructure as service” providers. Think Uber. It started as a ride-hail ing or delivery company and has expanded to offer other digital services within its ecosys tem. “Those additional services now represent an impressive portion of their businesses,” Sturm says. “And for good reason: they have large and highly-engaged captive audiences and they can tailor their digital products to seamlessly integrate into their ‘core’ busi ness models. I believe large consumer brands might increasingly extend their digital guest relationships and app ecosystems to offer additive products and services to power their core business.” Digital currently represents roughly a third of overall sales at Tim Hortons in Canada. The chain boasts the largest monthly active app user base (it also has the highest app usage frequency) within the F&B industry in the country—even higher than third-party delivery aggregators. For perspective, about 11 percent of the entire Canadian population uses the Tim Hor tons app at least once per month. Sturm says, in part, the success is a reflection of engaging experiences the brand added over the past two years, like fully digitizing its Roll Up To Win campaign and launching the Tim Hortons NHL Hockey Challenge. Additionally, it integrated community-oriented features in its loyalty offering, like “Round Up,” which allows users to instantly benefit the Tim Hortons Founda tion Camps. A more recent example is “Scan & Pay,” where guests can earn/redeem rewards points in a single scan. “This will help save time at the counter or drive-thru window be cause guests can scan for Tims Rewards and provide payment in one simple step,” Sturm says. “This is a massively impactful feature; we anticipate it will cut current loyalty pay ment times in half.' q

Denny Marie Post Nextbite C O - P R E S I D E N T Post brought star power to Nextbite when she joined the company as co-president in May. The former Red Robin CEO, who also held leadership

Markus Sturm Tim Hortons S V P , D I G I T A L Tim Hortons’ mar ket share position ing in Canada is enviable, to put it lightly. The brand sells seven out of every 10 coffees.

NEXTBITE

roles at Starbucks, KFC, and Burger King in her career, had served as an adviser to Nextbite since September 2021. She had a front-row seat to a burgeoning movement that’s begun to settle into something lasting. Nextbite helps operators enter the virtual restaurant space with its delivery-only menus. Post oversees marketing, operations, and culinary innovation along with providing a strategic focus with Nextbite’s restaurant fulfillment partners. “I chose to join Nextbite because I see a tremendous opportunity to re-imagine the future of the restaurant industry to derive maximum return from existing brick-and mortar assets,” she says. “There is so much upside potential to be realized.” Post has been in the industry since joining KFC in 1995. Back then, in-restaurant technol ogy consisted of POS systems and the most innovative thing was a digital menuboard. Off-premises? Call-ahead takeout was about as far as that went. “So much has happened in the intervening three decades and much more rapidly in the last 5–7 years,” Post says. “Consumer adop tion of digital tools in restaurant and at home, driven in part by the contactless pandemic demand, has picked up tremendous momen tum and has highlighted multiple gaps in restaurants’ ability to fulfill.” Alex Canter, Nextbite’s CEO, founded Ordermark (which would change its name to

That makes its digital footprint and ability to

TIM HORTONS

engage with one of the industry’s most fervent fanbases a job that’s also difficult to rival. “I consider myself incredibly lucky; I have one of the best jobs in Canada,” Markus Sturm says. The brand’s digital leader has spent eight years in the sector. Tech adoption, both by consumers and operators, has rocketed through that stretch. On the former, Sturm says, smartphone adoption stirred a proliferation of restaurant apps. And in turn, how brands posi tion them. “Initially, most restaurant apps were focused on functional benefits such as line skipping via mobile ordering or earning and redeeming loyalty points or digital coupons,” he says. “But those functional features have now become table stakes, and restaurants are competing for a deeper, more emotional digital relationship with their guests.” From the operations side, it’s been a race to provide experience for customers and workers alike. Newer service models, such as drive-thru, mobile ordering, and deliv ery, were all heightened throughout COVID. Meanwhile, the labor market tightened and

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DECEMBER 2022 | QSR | www.qsrmagazine.com