2. Twenty five years ago this week, I went to the cinema to see
Back to the Future II. Set in the futuristic sounding 2015, it
promised a world of flying cars, hoverboards and, most worryingly,
home nuclear fusion reactors. The closest the plot writers got
to predicting our future was the watch that forecast the weather,
and that Nike are set to finally sell self-tying laces.
Clearly the idea of a pocket computer which would allow you not
only to speak to but also see and write to anyone in the world –
whilst at the same time choosing where to eat based on an online
review, getting there using real-time navigation and ordering your
drink in advance – was unimaginable at the time. But it is the
biggest single technological change affecting not just our sector
but our lives as a whole.
So this report from Orderella, with research findings from ALMR
members on the increased prevalence of technology in hospitality,
offers some very timely insights. While it appears to highlight the
different priorities guests and operators have, what it actually does
is highlight the different means they use to achieve the same end
– a great overall experience. All are agreed that speed of service
can enhance an offer but it can also detract from an otherwise
good experience. As the restaurant guru Jim Sullivan says –
great service can make up for a mediocre offer, but even great
food can’t compensate for poor service.
And technology undoubtedly has an increasingly important role
to play. The best operators use the newest technology to enhance
the overall customer experience without getting in the way of it.
Moreover, the truly tech-savvy use the savings it offers to invest
back into the theatre and experience customers crave.
The benefits for those operators who get it right are clear from
this report – and it also provides a route map to unlock them.
We urge operators to explore what technology can do for them –
but perhaps best to leave the home nuclear fusion reactors to
the Back to the Future fantasies!
Kate Nicholls
CEO of the
Association of Licensed
Multiple Retailers
How the data was collected
This report is based on the findings of two pieces of research. The first is a OnePoll survey
on behalf of Orderella of 2,000 UK adults who go to pubs, bars, restaurants or nightclubs
regularly. Conducted in May 2015, the survey asked a near equal number of males and
females proportioned by age and UK-wide geographical location. The business survey
was of 17 Association of Licensed Multiple Retailers (ALMR) members, which together,
represent a total of 348 venues throughout the country.
The best operators
use the newest
technology to
enhance the overall
customer experience
without getting
in the way of it
“
“
FOREWORD
3. always on-trade report | 2
01 How technology shapes the on-trade today 3
02 The ever-evolving social media landscape 4
03 Technology’s role in raising service standards 5
04 The cashless payment revolution 7
05 The future: a potential that can’t be ignored 8
06 Conclusion from Dennis Collet 10
CONTENTS
4. 3 | always on-trade report
01 How technology shapes the on-trade today
3 | always on trade report
The perceived benefits
of technology
According to the Orderella consumer
survey, it is clear that technology is
valued in hospitality venues. Of those
polled, more than half (52%) believed
technology improved their experience
in a bar, pub, nightclub or restaurant.
This figure rises to 64% for 18-24
year olds, but peaks at 67% for the
25-34 age group.
What consumers now expect
A number of technologies that not
so long ago were considered novel
in hospitality venues are now
reasonably common. The Orderella
consumer survey found that 61%
of people have used a chip and pin
device to make a payment in a bar,
pub, nightclub or restaurant. This
increases to 74% among 18-24 year
olds. Meanwhile, 58% of people have
embraced free Wi-Fi. These figure also
grows among 18-24 year olds to 65%.
Less established technologies also
appear to be gaining a considerable
foothold in the on-trade, and younger
generations are leading the way.
Overall, 19% of consumers have made
contactless payments – a figure that
rises to 31% in the 18-24 age group,
but falls to just 14% for those aged
45 or older.
Similarly, 7% of consumers have now
used a tablet or electronic device to
order food and drinks. This rises to
11% for 18-24 year olds, but falls
to just 4% for those aged 55 and
over. It is likely that this number will
rise rapidly in line with The Payments
Council predictions that the majority of
transactions will be cashless in 2016,
particularly among younger consumers
that are already less reliant on cash.2
How venues meet this demand
On the whole, hospitality providers
appear to be meeting the common
usage needs of their customers.
Of ALMR members surveyed, all
claimed to provide a chip and pin card
machine, while 94% offered free Wi-Fi.
However, just 24% were able to take
orders via an electronic device, and
only 59% could offer cashless
payments. This means that four in
10 operators are currently unable
to service nearly one in five (19%)
customers who make cashless
payments, while three-quarters of
operators are missing out on the
7% of customers who find it
convenient to order food and drinks
via a tablet or electronic device.
While 7% may not appear significant
at the moment, the rapid advances
in convenient, handheld technology
means this proportion is likely to grow
significantly in the near future.
New technologies often have a way of becoming universal so quickly that it’s easy to forget how our
lives were before they came into existence. Take the mobile phone, for instance. At the turn of the
century, just 36% of the UK population owned one – but today, there are more connected mobile
handsets in the country than there are people.1
Change is the only constant, as the saying goes. So when it comes to new technology, the on-trade
faces a constant challenge to meet ever-changing consumer expectations.
52%believed
technology
improved their
experience
5. always on-trade report | 4
02 The ever-evolving social media landscape
The on-trade appears to have had little trouble
embracing the more familiar aspects of social media.
All of the ALMR operators surveyed said they have
a website, and Facebook and Twitter pages. Additionally,
a significant number of operators are active on:
The level of social media usage among operators,
however, varied greatly. While 12% said their business
was active on social media more than 10 times a day,
6% said they were active only once or twice a month.
Consumer engagement
While only 28% of consumers polled claimed to have
engaged with the social media channels of hospitality
venues – as might be expected – the proportion varied
greatly among the different age groups.
According to the Oderella survey, as many as 46% of
18-24 year olds have engaged with on-trade social
media channels, falling to just 17% in the 55+ age
group. There was also a noticeable gender difference,
with fewer men (24%) engaging with social media
channels than women (32%).
SHARING THE EXPERIENCE
Some operators may remain sceptical of customer review
sites, but it’s clear that many customers now regard them
as an important part of the on-trade experience.
When a customer takes the time to write about their
experience at a hospitality venue, it demonstrates that
they have an interest in that business and want others to
benefit from that experience, whether good or bad. Typically,
they are social media savvy and will not hesitate sharing
information via platforms such as Facebook and Twitter.
This presents a real opportunity to use social media and
online review sites to directly engage with their customers
to create meaningful relationships and foster loyalty through
offers and promotions.
Significantly, half of all the consumers polled said they
had completed an online review after visiting a venue, the
majority of which were restaurants (39%), followed by
pubs (17%), and then bars (10%). While these proportions
fall away in pubs and bars among the older age groups,
they actually increase slightly in restaurants, peaking at
42% for those aged 55+.
Importantly for operators, more consumers said they
were increasingly likely to leave a review if they had
a positive experience (33%) than those who had a
negative one (20%) – the remaining respondents said
they would leave a review regardless of the experience.
The younger the age group, the more polarising this
becomes, with 47% of 18-24 year olds more likely to leave
a review based on a positive experience, and 26% more
likely to leave a review after a negative one. There is also
a noticeable gender disparity, with 60% of males more
likely to leave feedback based on a negative or positive
experience, compared to just 48% of women.
41% 35%
100%of venues polled have
a website, twitter
and Facebook account
18%
www
6. 5 | always on-trade report
03 Technology’s role in raising service standards
Operators shouldn’t really need to be told of the importance
of good service. In the current on-trade environment, much
of that still relies on staff interaction with customers. What
is becoming more apparent is the role that technology
can play in helping to transform the way that interaction
is focused. It allows venues to focus more on the positive
and valuable elements of service like staff knowledge and
attentiveness, rather than the ‘technicalities’ of the job like
taking orders or payments.
For example, mobile ordering apps like Orderella free staff
up from these elements so they can be dedicated to making
the customer experience more personable and friendly; and
providing customers with the best ‘product’ possible.
Prioritising service needs
In the Orderella survey, half of consumers described staff
interaction with customers as ‘very’ important, while a
further 24% said it was ‘somewhat’ important. Meanwhile,
just 2% believed it wasn’t important at all. The ALMR
members’ poll is even more resounding, with 76% having
claimed it to be ‘very’ important, while the remaining 24%
described it as ‘somewhat’ important.
While these figures indicate considerable awareness of the
benefits of staff engagement, operators shouldn’t be under
any illusions that if the product offer isn’t up to scratch,
or if customers are left waiting to be served, a friendly smile
from a table waiter will quickly become less important.
The Orderella survey asked consumers to prioritise what
they thought was most important from a list of 10 choices.
Quality of food on offer topped the ranking, with 39% of
people scoring it a ‘one’ (i.e. most important) on a one-to-10
scale. A clean bar and/or tables came second, with 27%
of people scoring it the highest possible mark, and not far
behind in third was quality of service (23%).
In a similar question to the ALMR members, which
asked what they thought mattered most to customers,
knowledgeable and friendly staff came out top. Quality
of both food and drinks ranked equal second, while speed
of service came in joint fifth, along with location.
The benefits of a speedy service
While it’s understandable that operators regard the wait
for service as less important than the quality of their food
and drinks offer, they should be in no doubt that it is a
concerning issue for customers.
According to the Orderella survey, 77% of consumers
claimed long queues or waiting for service has had a
negative impact on their experience at a venue.
Operators certainly appreciate the need for a speedy
service, given that 100% of the ALMR members
surveyed said they lose up to 10% of customers because
of long queues.
Similarly, almost half (47%) of the operators surveyed
believed customers would be more likely to spend more
or leave a tip if they were guaranteed a quicker service,
with just 29% claiming they wouldn’t, and the remaining
24% unsure.
venues LOSE
because of long queues
10% OF CUSTOMERS
76%of ALMR MEMBERS SAY STAFF
INTERACTION WITH CUSTOMERS
IS VERY IMPORTANT
JUST 2%of consumers believe
staff interaction is
not important at all
7. always on-trade report | 6
What customers
VALUE MOST VS
What ELSE makes a great experience?
of consumers claimed long queues
or waiting for service has a negative
impact on their experience at a venue.
What venues think
customers value most
PRICE
INFORMATIVE
MENUS
QUALITY OF
SERVICE
KNOWLEDGEABLE
FRIENDLY STAFF
CLEAN BAR/
TABLES
QUALITY
FOOD39%
77%
63%
27% 38%
15% 75%
23% 31%
15% 6%
21% 56%
19% 63%
14% 50%LOCATION
VARIETY
OF DRINKS
8. 7 | always on-trade report
04 The cashless payment revolution
The news that cash transactions were overtaken in
value by other payment methods for the first time in
20143
will not surprise too many on-trade operators.
And it seems that most are keeping up with trends,
with 59% of ALMR members surveyed claiming to
offer cashless payments. Payments made by neither
cash or card are also starting to emerge – 12% of
operators said they are able to accept payment through
Orderella, 6% through other in-app payments, and a
further 6% through mobile payments such as PayPal.
Preferred methods of payment
As to whether operators believed they are losing out on
custom by not offering customers their preferred payment
option, the situation is less clear.
Almost a quarter of ALMR operators surveyed (23%)
either ‘definitely’ or ‘suspect’ they have lost custom, while
12% said they haven’t. This leaves almost two-thirds (65%)
suspecting they haven’t, without being entirely certain.
It appears the good news for operators is that 76% of
consumers ‘definitely’ haven’t given up on an order because
a venue didn’t have their preferred method of payment.
However, on the flipside, it also means 24% say they
have – confirming operators’ fears that almost one in four
customers have been denied the chance to make a
purchase the way they want.
With UK pub and bar sales alone currently valued at
£18 billion4
, that 24% represents £4.32 billion in sales
that operators are leaving open to jeopardy by not offering
customers their preferred payment option.
Tipping culture
While there has been a culture of tipping in restaurants
for a number of years now, it hasn’t yet become an intrinsic
part of the pub environment. According to the Orderella
consumer survey, just 6% of consumers said they never
tip in a restaurant, but that figure rises to 47% across pubs
and bars – perhaps surprising given the rise of food-led
pubs in recent years.
When consumers are asked whether they are more likely
to leave a tip if they were guaranteed a quicker service, an
opportunity arises. The consumer survey found that 22%
of customers would tip more in pubs and bars, and in
restaurants, that rises to 42%.
Drilling down the data by age group also reveals how
much more value is placed on speed of service by younger
generations. The survey showed that while just 16% of
the 45+ age group would tip more in both pubs and bars
if they were guaranteed a quicker service, among 18-24
year olds that rises to 38% in pubs and 32% in bars.
Similarly, while only 9% of the 45+ age group would tip
more for a guaranteed faster service in a club, 25% of
the 18-24 age group would be happy to do the same.
UK pubs and bars
because of lack of
payment options
COULD LOSE
£4.32 billion£
9. always on-trade report | 8
05 The future: a potential that can’t be ignored
One reliable way of assessing the value of technology
is to ask customers how beneficial they feel it will be in
the near future.
According to the Orderella survey, half of all consumers
(49%) believe technology will either have a ‘very’ or
‘quite’ important role in improving customer service in
bars, pubs and clubs in the months and years to come.
This increases to 56% among 18-24 year olds, but also
scores well among 25-34 year olds (59%) and 35-44 year
olds (56%) – suggesting that those who grew up through
the rise of the digital age and computers are more open
to the benefits that technology can bring.
One in five customers (21%) are positive about the
potential role of technology in eventually helping to stem
pub closures. While perhaps more attuned to the broader
challenges faced by the pub sector, 24% of operators
still believed technology could stem pub closures.
Implementing new technology
Operators also appear to be engaged in embracing new
technology. When asked whether they were considering
implementing new technology in the near future, 35% of
the ALMR members polled said they were actively installing
it, 24% said they had identified it and will install it soon,
while a further 35% were currently researching the market.
Cost considerations always come into play when any
investment is concerned, and 94% of ALMR members
said it would be a barrier to implementing new technology.
However, much fewer (35%) said customers not wanting
it would prevent them from investing – demonstrating that
the business case for new technology is usually there,
even if the money isn’t.
A mobile app such as Orderella, which can simplify the
ordering and payments process, will inevitably score well
with customers. Bypassing queuing altogether, customers
can quickly order and pay for drinks from their stored debit
or credit card, before collecting them from a delivery point
or having them served at their table.
Equally, operators benefit because it’s a cloud-based
technology which means a low-cost implementation option
for venues, so upfront investment is much lower than
implementing new hardware. In the long term, they also
benefit from eradicating the cost of processing payments
which is the only element of a sale that doesn’t offer any
value add above and beyond the payment.
Furthermore, the app can increase staff productivity so
time is better spent improving the customer experience,
while allowing operators to gain valuable insights into
their customers’ ordering behaviour – enabling them to
send targeted marketing offers in return.
are actively installing tech
operators believe pubs
will stop taking cash
operators would consider
alternatives to cash or
card to reduce queues
say cost is the
main barrier
35% of ALMR
members
3 in 10
8 in 10
94%£
£
£
£
10. 9 | always on-trade report
The alternative payment potential
According to the ALMR members’ survey, 29% of operators
believed pubs will eventually stop accepting cash.
Just as significantly, when it comes to trying out methods
of payment other than cash or cards, with the intention
of reducing queues or the time it takes to serve each
customer, 82% of operators said they would be happy to
consider it. Meanwhile, nearly half (45%) of consumers
said they would consider other methods of payments.
This positive response only serves to prove that, when
shown tangible benefits, both consumers and hospitality
venues are keen to move with the times and embrace
the latest technology available to them.
Why operators must embrace change
The consensus from both operators and their customers is
that new technology has a central role in helping to improve
the overall on-trade experience. Enabled by the growth
of digital devices and mobile apps such as Orderella,
the ordering and purchasing of food and drink is set to
become faster and simpler.
Already, one in five ALMR members surveyed offer some
form of mobile payment. As this proportion increases,
customer expectations of good service are likely to
increase, making them even less tolerant of long waits
at the bar, or food not arriving on time.
In an increasingly competitive retail market where standards
will be set ever higher, operators need to be in tune to these
changing customer demands. Those that aren’t face being
left behind.
What tech will be in venues in 20 years’time according to consumers
What tech will be in venues in 20 years’time according to licensees
Technology in pubs in 20 years’time
Beer mats that
keep drinks cold
Beer mats that
keep drinks cold
CASHLESS
BARS
Interactive
tables
Interactive
tables
Auto-refillable
glasses
CASHLESS
BARS
Auto-refillable
glasses
Automatic wine
dispensers
Augmented
reality
Robot bar
tenders
Interactive Touch
screen tables
51%
54% 29%
35%
62%
24% 19%
23%
13%
23%
11%
15%
AR
11. always on-trade report | 10
DENNIS COLLET
CEO of Orderella
Like all industries, the hospitality sector has been and still is going
through a testing time. What is clear from this report is technology
has an important role to play in pushing the industry on, be it
improving the service for customers or attracting them to a venue
in the first place. Technology is particularly important for the
younger generation, the 18-24 year olds, the future of the
industry. For them, using technology is second nature, they have
become accustomed to using it in every aspect of their lives, and
going out to pubs, bars or restaurants is no exception.
Payment options and speed of service must be priorities for
venues in the near to long term future. Owners risk alienating
three quarters of their customer base if they do not address the
issue of long queues – a factor that we found has a big impact on
a customer’s experience of a venue. The younger generation have
also already shown themselves to be the most vocal about leaving
a venue if they can’t pay the way they want and admit they would
tip more for a quicker service. Venue owners must get this group
on side or risk losing increasing amounts of business to other
venues that will.
Venues are beginning to embrace technology but they must
go further to meet customer’s expectations and identify the areas
they are still falling behind in. Cost is inevitably a factor, but there
are options out there where the reward is worth the investment.
It’s about owners taking the time to research and identify the
best options for that venue and ultimately improving the overall
customer experience for the better. If they can do that, then the
future of the industry looks healthy and strong.
06 CONCLUSION
Venues are
beginning to embrace
technology but they
must go further
to meet customer’s
expectations and
identify the areas
they are still
falling behind in.
“
“
refrences
1 Ofcom 2/3 The Payments Council 4 IBISWorld Pubs Bars market research report – March 2015
12. 11 | always on-trade reportin partnership with the Association of Licensed Multiple Retailers
