The digital age is eliminating the need for cash or, in some cases, even credit cards at restaurants, as many customers now prefer to pay through technology.
Restaurant credit card payment options, like tabletop kiosks or mobile wallets, are a simple way for customers to pay for their meals quickly and easily. A major pro for the consumer is convenience as the tech means there’s no need to wait on the staff to bring the check, take your card/cash and wait for the receipt. Payments technology gives customers the ability to make payments with little effort.
According to Statista, the number of people with smartphones will grow to 2.5 billion by 2019, and approximately 67 percent of the U.S. population currently owns a smartphone. This has led to more interest by consumers to pay for things simply with their phone.
People rarely forget their phones, but they do forget wallets and credit cards, so the beauty of using mobile payment solutions is that one can use their watch or phone to pay for something quickly and easily.
“The consumer loves the idea of not having their credit or debit card leave the table.” – Sam Ballas, CEO of East Coast Wings + Grill
Examples of Cashless Payment Apps
Mobile wallets are mobile phone apps or a phone’s secure element that can store payment cards, loyalty cards, coupons, tickets, and other information traditionally stored in a leather wallet. Major players include Apple Pay, Android Pay, Samsung Pay and Google Wallet.
All consumers need to do is add the information of their payment cards to one of these services and they can utilize them at restaurants and online using one of the authentication methods such as fingerprints, email/password, etc.
Most outlets that accept this payment are quick service restaurants, as the customer pays directly at the register instead of through a waiter.
A Huge Opportunity For Restaurants
Joe Kleinwaechter, vice president of innovation and design at Worldpay US, a payment processing company for small businesses, says in-app payments provide a huge opportunity for restaurants.
“Companies like Starbucks have found great success in using an app as a form of payment,” he says. “This not only encourages customers to download the restaurant’s app, but it’s a great way to reach customers with coupons, special offers and announcements, ultimately creating a stronger consumer connection.”
Joel Udwin, head of mobile products at Paytronix in Newton, Massachusetts, says convenient digital experiences like in-app payments and Apple Pay-integrated loyalty allow restaurants to focus on building the food experience that millennials are craving. “These payment experiences should be top of mind for marketers as enabling mobile payment can increase known guest percentages, as well as make loyalty an operationally seamless experience,” he says.
Which Types of Restaurants are Using Payment Apps? (Hint: All of Them)
Fast Food Restaurants
Apple Pay connects consumers with their credit and debit cards and allows them to make payments by touching their phone to a terminal enabled with near-field communication, or NFC, and holding their thumb to the fingerprint sensor, called Touch ID, to authenticate the purchase. This is regularly being used by places such as Dunkin’ Donuts, Jersey Mike’s Subs, Johnny Rockets, McDonald’s and Panera Bread.
Fast Casual Restaurants
Then there are tabletop kiosks, which allow customers to place their orders and pay without having to wait for a server. Applebee’s, Olive Garden and Panera are three chains utilizing these kiosks, which enable a faster payment experience for customers and free up the staff’s time to attend to other customers.
But even the most formal sit-down spots are adopting payment technology. Cover is an app serving restaurant customers in New York and San Francisco. Using Cover, you pay for the check with your phone, without actually receiving the check. It’s fun — if a little disconcerting at first — to walk out of the restaurant without dealing with a bill, but I speak from experience when I say it doesn’t take long to get completely used to it.
OpenTable is introducing a similar program at restaurants in San Francisco. Open the app while at your scheduled OpenTable reservation, pay the tab with your phone, and leave without needing to ask for the bill.
“Adoption for these restaurants is much more natural,” Kleinwaechter says. “Accepting mobile payments at sit-down restaurants would need to include some other payments technology, like tabletop kiosks, to take the payment, as a waiter can’t take a customer’s phone back to the register to process the payment.”
The U.S. is Behind Pay-at-the-Table Trends
Sam Ballas, CEO of East Coast Wings + Grill in Winston Salem, North Carolina, says the company recently implemented a test phase for FreedomPay, a new pay-at-the-table option for guests, which offers solutions addressing payment security, loyalty and incentives, real-time data capabilities, and expected monetary value.
“Having traveled to Europe this past summer, it was evident that [our country] is behind most of the world in this consumer-based enhancer,” he says. “I had pay-at-the-table in more than 90 percent of my dining experiences while traveling.”
Ballas says offering customers a secured credit card transaction and an updated transaction experience had already been on the company’s agenda for the past several years, and knew it was time when looking at all FreedomPay had to offer.
“Enabling mobile payment can increase known guest percentages, as well as make loyalty an operationally seamless experience.” – Joel Udwin, head of mobile products at Paytronix
Four Reasons Your Restaurant Should Add Mobile Payments
If you’re on the fence about introducing mobile payments to your restaurant, here are three reasons you should be considering it:
1.Turn Tables More Quickly
When using mobile payment technology, tables turn an average of 15 minutes more quickly. Splitting the bill between parties used to involve lots of small bills, now it involves lots of credit cards, which is a pain for your server and time consuming to stand there swiping multiple cards. Make it easier for your guests to split the bill by letting them take care of it themselves. Using an app, customers can get their bill, split it between friends, and pay for it, all with a few taps and swipes right from their phones. They no longer need to wait for their server to come back to the table, ask for their bill, and wait for credit cards to process. Skipping this step entirely means that the server doesn’t even need to be involved in cashing out the transaction and can focus instead on excellent customer service. Tables are cleared more quickly and ready for another party in record time.
2. Your Customers Want It
If your customers are already using this technology, then it’s time to get on board. People travel much lighter these days and are not carrying as much cash, if any at all. More and more, apps in their phones are even replacing credit cards. (Think Uber.) The next frontier for this convenience is dining out and barhopping around town. Picture a crowded bar, your customers can now finish their drinks, settle up and leave, without elbowing their way back to the bar. The faster you can be a leader in mobile payments, the faster you’ll be getting their business.
“The first set of data we’ve seen has been consumer based and we’ve learned that the consumer loves the idea of not having their credit or debit card leave the table,” he says. “East Coast Wings + Grill will be concluding the pay-at-the-table test locations by the end of Q1, and if the data sustains as it is currently, we will begin a mandatory transition in every unit nationwide concluding by year end.”
3. Real-Time Data
Mobile payments offer a lot of valuable data to the restaurateur, in real time. Restaurateurs can get a snapshot of the restaurant in real time, whether or not they’re physically there. See which servers have how many tables, how much money has come in so far that night, and how many people are waiting for tables. Real time data helps see if problems are isolated incidents, or recurring problems that need to be addressed. Mobile payments also allow for real time feedback, as payment prompts a review (that isn’t public) then and there. You can see a negative review before the guest has left your restaurant, giving you an opportunity to make it right before that person even leaves.
4. Increase Tips
Udwin notes that California Pizza Kitchen has really excelled with its Pizza Dough Rewards payment app, with staff seeing tips increase by 40 percent for in-app payments versus credit/cash.
Still, Kleinwaechter notes, payments technology can prove problematic during the adoption process. It can be difficult for customers to use the technology when they’re not familiar with it or when the technology isn’t consistent across restaurants. “Without an established system, customers may not know what to do with the tech and what’s expected of them when using it,” he says.
That’s why it’s vital that restaurants cater to the majority of customers who enjoy the move to digital while still appealing to those who prefer more traditional payment methods.
“Although accepting new payment options and adopting payments technology is beneficial for business, it’s still important for restaurants to allow their customers to pay how they want— whether digitally or not,” he says.
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