MONDAY MINUTE: October 10, 2022

Updated: Oct 23

First Party Ordering improves the customer experience.

All these headlines and more represent our thoughts and views on the world of restaurants, technology and off premise food in our round up of the last week’s hot news stories - subscribe today to the Monday Minute and register at www.learn.delivery for more bonus content.


Articles mentioned in the video:

1. Jay Z teams up with Stellar Pizza


2. Presto goes IPO (Presto IPO and the creation of a one-stop shop)


3. Shake Shack Vies for Gen Z by Entering Gaming World


4. Mobile Ordering Blurs the Restaurant Lines Even Further


5. GrubHub now partnering with GoPuff


TRANSCRIPT:

Carl: Jay-Z gets robotic with pizza. The Sims go to Shake Shack and do first party apps improve the customer experience. That's all ahead on this week's Monday Minute .

Monday Minute works like this, we're going to ask each other five questions about the headlines that have caught our attention that in some way come back to our book Delivering the Digital Restaurant. Are you ready? Let's go.

Meredith: Carl, the first question is for you this week. There is an interesting pizza company that has received funding from Jay-Z's, Marcy Venture Partners, and it reminds me a little bit of Zume, which did not end well. So tell us what's different about this one and whether or not it's exciting.


Carl: We, we framed this up with talking about Jay-Z and of course, I guess that's why we we're wearing the shades today, Meredith. So we're looking extra [00:01:00] cool. 16 and a half million dollars worth of funding from Jay-Z's Marcy Venture Partners Fund. There's three SpaceX engineers behind this particular initiative.

You, you know, you're right in the sense of saying maybe this is relatively similar to what we saw with Zume. There are plenty of folks out there doing things around pizza and automation. This particular company is actually saying they do 420 pizzas per hour, takes five minutes prep time, only one employee.

And of course they're cooking the pizza as it's on the road. So in that sense, it kind of improves the overall ability for you to deliver pizza in a faster fashion. It's going to launch at the USC campus this fall. I don't know. You know, for me, I think it's going to be interesting to see whether this falls along the same kind of lines as what happened to Zume.

I think there's the challenge of knowing exactly where you need to be to be able to deliver. Again, if it takes five minutes to deliver a pizza, how many orders are you gonna get in a particular hour? Is it more like a food truck business where you just wanna choose the location where, you know, there's a lot of traffic,


Meredith: True, but these Stellar Pizza guys literally have sent things to space. So I feel like pizza is probably a layup compared to that. I don't know. We'll see, we'll see.


Carl: Okay. Second question. Presto had an IPO, so a bit of exciting news for the folks that are certainly putting their momentum behind voice technology right now. But tell us what are your thoughts around this?


Meredith: Yeah, so Presto has gone public via SPAC. Congratulations to the Presto team. What I find most interesting about this particular iteration of restaurant tech is that they're combining what I'll call the senses. They do voice, vision, and touch all in one place. So it's thinking about all the different ways in which a consumer might want to interact with a restaurant. And I have to imagine that on the back end somewhere, they're combining all of that data to do something really interesting.


Carl: Yeah, it's a really interesting space right now, just how voice technology is evolving. I was speaking to a startup the other day that's using conversational AI to actually help the order taker be able to use information that's been gathered through voice technology to be able to improve deviations in typical processes.

So I think we're gonna see a lot of innovation in this space and, and certainly Presto are going to be one of the leaders out there.


Meredith: Yeah, for sure.

Okay, Carl, what's up with all the gaming? I feel like every fast food restaurant ever is inside of some game. And I guess I'm wondering, are consumers actually ordering on these platforms?

Will they order on these platforms or is it just about brand awareness? And these gaming platforms are the TV of yesteryear.


Carl: Yeah. Well you are talking about Shake Shack, aren't you? You're talking about Shake Shack, and I've got to ask you, have you ever played the game the Sims?. It's it's where you control a bunch of people.

You create their lives and basically you monitor them through their lives and they go 'mumble' to each other. It's kind of fun. You'll enjoy it. You should check it out. The Sims really got big through the pandemic where people got back into gaming, of course, and Shake Shack have teamed up with a company that's basically recreated the Shake Shack store to really [00:04:00] minutia levels of detail. They allow people to be able to send their sim characters into their Shake Shack to order the food for their sims to be able to see everything on the menu. Everything in terms of the ingredients that go into the menu. All to the details of even like the plants that they have in the store.


So it's, I guess it's a brand awareness campaign of sorts. I really think that's a big part of it. We often are talking about Web 3.0. We're often saying, when you are in these digital environments, can you potentially see yourself then also been able to order not just food for your sim, but perhaps for yourself as well.


And I think we'll see that type of thing evolve in time. For now, I think what Shake Shack are doing is recognizing they want to reach out to the Gen Zs out there that are playing these types of games in a online environment and are using it as an opportunity to say, Hey, check us out. When you look at the, the Shake Shack business, I think it was ranked 19 on QSRs top 25 fastest growing chains. It's got about 240 locations across the US. It's opening another 45-50 this year. So it's clearly going places. And of course our friend Mr. Danny Meyer was the man behind the idea.


The man behind it. Yeah, I, I think it'll be interesting to see whether this expands beyond just a gaming environment for brand and actually becomes something where you could perhaps order your food in an online environment.


Meredith: Yeah, and I think it certainly works at a branding awareness level.

I think everyone knows my son is a vegetarian and has never been to a fast food restaurant other than of course Taco Bell, right?


Carl: Yeah, of course.


Meredith: Yeah. Vegetarian restaurant. But he still built a McDonald's inside his Minecraft world. Which was fascinating to me. He's never been inside of a McDonald's.

He. Eat there, but he built one and same thing. It had like a service counter. It had a drive through, it had the logo, it had booths as though he had been there. And so he's been so exposed to these concepts through his gaming world that they are real to him, even though he's never been to one.

Right.

It's incredible.


Carl: Yeah. I think it's gonna be fascinating just to see how that kind of develops in time. All right. Meredith, we've been a bit light so far on data this week. I feel we need to bring some data into the discussion.


Meredith: Oh, sure thing. You've come to the right place.


Carl: Uh, yes. I know you were at Restaurant Spaces. I'm sure you've got some good little nuggets from Restaurant Spaces up in Santa Barbara.

But I know a particular article caught your attention talking about mobile ordering and one of the things I saw about it was just how it was now representing some of the performance between first party and third party apps from a customer perspective. Yep. So, So let me do this. Perhaps they help you through, cause I know there's lots of stuff you wanna talk about.


Meredith: Oh my gosh. Yeah.


Carl: So let me bring this up in the background and then we'll take people through it as and when you're ready.


Meredith: Okay. So this article I loved, it had so many graphs in it that I just didn't even know where to start. There's too many good things in these graphs. There was a lot about ordering food as well as ordering from convenience stores, which is up dramatically.

So that was very interesting to see. The thing that was most interesting to me was this chart here. What we're looking at is the NPS scores for first party apps versus third party apps, broken out by type of restaurant, fast casual, quick serve, and convenience stores, and in every single case, the NPS or net promoter score was higher for the first party app.

Meaning that the consumers that were surveyed at least indicated a preference for ordering through the first party apps, which I think we've seen prior studies that say consumers understand that it's better for restaurants and they like the first party apps and they self-report that they would use them and things like that.

But here they're actually saying that they like the experience better on the first party apps, which I think is very, very interesting. They also measured something called csat, which is just another way of measuring the same thing, showed the same type of response. Then they asked consumers, what's most important to you as you're getting delivery?

And Carl, I know you're going to be really surprised to hear this. It was accuracy, temperature and speed.


Carl: Wow. What a surprise.


Meredith: I mean, the same things they care about when they're eating in a restaurant or getting drive-thru. But those continue to be the three things that matter most in getting right and getting consumers to be happy and coming back.

And then there were a bunch of what I'll call survey questions that cross tabulated those two results and said that first party is perceived to be better on those three dimensions, accuracy, speed, and temperature. And of course that explains the overall higher satisfaction levels on first party.

So I thought that was absolutely fantastic. Thing that we didn't get to. I think in the, what you're showing was why do people actually order on their phone? And of course people say "it's convenient. I like to eat at home. It's faster than dining in. I can track my order progress," but 8% of people responded. "I have fewer interactions with employees."


Carl: I don't wanna speak to anyone.


Meredith: I thought that was really interesting. And so there's some of us for whom I guess being locked up during Covid was a good thing. But anyway, it was, it was a very good study. I definitely recommend reading the article or going back to the original study because I got a lot out of it.

All right, Carl, so, GrubHub.


Carl: Mm-hmm.


Meredith: More partnership news. Grub Now partnering with Go Puff. Tell us about that one.


Carl: GrubHub have been in the news again because they have announced a partnership with with Go Puff. Go Puff, of course, are disrupting the C store space, as we know with these micro fulfillment centers, helping C store type items get to people within 20 minutes or maybe less.

And certainly an early part of this year they were opening up locations at I believe one a day, which, you know, from a development standpoint, you must be super impressed with.


Meredith: I'm very impressed.


Carl: Now they're only starting this relationship with GrubHub in New York, LA, and Boston. But I think what's interesting about it is, again, we're seeing Grub Hub respond to DoorDash with the Dash cart, we've seen the Corner shop with Uber and in time, really this is now we're seeing GrubHub saying we need to be in this place as well. How do I see this perhaps differentiating itself? Well, we know that Go Puff have been trying to play a little bit in the food space.


So in that sense, you could say if you'd have to avoid having more than one point of pickup. That actually could be advantageous for Grub Hub. But I don't know, part of me thinks that maybe Go Puff would've really liked to have got in to to working with Uber than perhaps GrubHub. Cause we know the marketshare for GrubHub has dropped.

But it's another signal I think that JustEat takeaway that acquired GrubHub is saying that, We need partnerships to be able to arrest the decline we've seen in our market share. And with Amazon and with Go Puff, they're certainly making a good go of it.


Meredith: Mm-hmm. absolutely.


Carl: All right. Well look, that's it for a Monday Minute this week. As ever, we'd love to get your comments about the articles that we're sharing. Obviously, take a look at our newsletter on LinkedIn called The Digital Restaurant where we cover some other articles that perhaps didn't make it to the Monday Minute this week.


Uh, please give us your comments about what you like, what you don't like, any things that you think we should cover in a future edition. But until next time, thanks for listening.



The Monday minute is available for you to follow and subscribe wherever you listen to your podcast. Watch us on YouTube and follow us on all our social media learn channels. Thanks for listening.


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