Blog For Restaurant Owners

The problem restaurateurs face when using Portals is that when a repeat or regular customers uses the Portal service to place an online order the cost to the restaurant is high(10-15%). When the order is from a new customer this cost can be justified. For repeat customers, however, it is just too expensive and margins get squeezed.

At iMenu360 the question that clients constantly ask is “how do I get Portal customers to order from my website so I don’t have to pay those high fees for repeat customers and capture the email address of the customer that ordered.”

Here are some ways restaurant owners can get customers to order from their website:

• First and foremost, make sure the Portal  is selling your goods at full price. Do not give them any coupons or discounts for their customers.

• Make sure there is a discount and loyalty program in place on the restaurant’s ordering platform. This will give customers a reason to order from the restaurant’s website.

• Put flyers in the Portal’s customer’s bags letting them know they can order online at yourwebsite.com and make sure they are aware of any discounts that are offered or loyalty programs that are in place on these flyers.

• Finally, don’t be afraid to cycle in and out of Portal. Stay on for 3 months and take 1 month off. Portal has no contracts and many of their customers that value your product will still want to place an order from your restaurant. Now the only way they can order online would be at your website.

There will be always a segment of customers who will order exclusively from Portal. However, for those customers who will order directly from the restaurant’s website it is important to do everything in your power to get them to do so. It will strengthen your brand in the long term and in the short term save you lots of money!

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Imagine that you started your restaurant with plenty of forethought, expecting a substantial share of your revenue coming from the high way traffic flowing not too far from your location. You were smart and you chose your location well. However, suddenly one day you discover that some other company (that you do not even care to do business with) redirected the traffic to its parking lot with the signs on the highway (with YOUR brand!!) and started taking orders for YOUR restaurant … AND charging you a fee for it!  What would YOU do?

1. Refuse to believe that such a thing can ever happen! (Most probably you belong here. If yes, read on because you are wrong!)
2. Consider it an innovative business model and start paying the imposed toll (Most probably you would disagree, but you are probably wrong again! read on…)
3. Consider it illegal and fight (Most probably you’ll think of this as the “right” thing to do …, you are probably wrong again! You won’t be able to do much!)
4. Consider it unethical and pursue it with the high way authority to prevent deceptive advertising. (This appears to be the lamest thing to do, but this is probably the only option in our system)
5. Stop taking orders from the ‘new’ company (You will have to be VERY strong and think through this …Many are doing it! So can you … or better yet, use this WITHOUT losing your business that they provide)

Lets us “dissect” the issue a little more to see what is what! Read more »

Filed under: Atul Shevade, Authors, Online Ordering, Portals, Web Strategy | No Comments »

Recently, Cornell professor Sherly Kime published a study named  “The Current State of Online Food Ordering in the U.S. Restaurant Industry”.  I found it quite interesting as it validated my belief that all  takeout restaurants will have a private label online ordering solution in place on their website in the near future.

Some of the highlights from the study are below:

• 26.9% of restaurants currently offer online ordering with more than half planning to have online ordering in the near future.

• The greatest benefits of online ordering are improvement in order accuracy and the need for less labor.

• On average, operators who used online ordering saw an increase in order frequency for takeout orders.

Her concluding paragraph sums it up well:

“ Online ordering has been adopted by about a quarter of restaurants that offer delivery and takeout, based on this set of respondents. Online ordering users have been pleased with the technology and all indicated that online or­dering has met or exceeded their expectations on ROI. The proven ability of online ordering to increase order frequency, order volume and average check in conjunction with its abil­ity to lower labor costs offers great potential for the restau­rant industry—and almost certainly will become a feature that most customers expect to have available to them. Set­ting aside customer expectations, the advantages of online ordering (improved order accuracy, improved productivity, and enhanced customer relationship management abilities) will probably offset the costs and operational challenges for most restaurant types.”

For a full report, feel free to send an email to David@imenu360.com and I will be happy to forward a copy to you.

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The old adage “nothing in life is free” holds true more often than not. Often there are negative implications in the long term for accepting free things.

Here are just a few examples in the online ordering world:

• Free supplies-Portals of the world (Grubhub, Seamless, Delivery.com, etc) give restaurants items such as bags, magnets, rain jackets, etc for the sole purpose of enhancing their brand with the restaurant’s customer. They are in business to get users to order from their websites. By giving out supplies with their logo, they enhance their brand with the restaurant’s customer.  Ultimately, the restaurant will end up paying higher processing fees if the restaurant’s customer orders from the portal’s website.

• Free websites-many companies give restaurants free websites if they use their product. For example, Grubhub and Eat24 offer free basic websites if you use their online ordering products.  While it may be nice not to have to spend a few dollars for creating a site, giving up ownership is bad business. A website is a gateway to the business and having complete control and ownership is critical.  Owning the URL is also very important.

• Free equipment-credit card processors often give free equipment when signing up customers.  They want their product chosen over a competitor and “free equipment” is one benefit they offer.  However, in the long run the fees they collect are likely to cost more than just buying the equipment outright.

Looking behind the motivation of the vendor is important when determining if accepting the free offer will do more damage than good.  It is always nice to get something free, but recognize it often comes with a cost.

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Now more than ever, restaurant patrons want to have the ability to place orders online. Smart operators recognize this and many have enabled their website to take online orders. In so doing, they see less mistakes, higher average tickets and lower labor costs. In addition online ordering enables a restaurant to easily acquire their customer’s email address for future marketing purposes.

Once a restaurant’s website is accepting online orders, the next step is driving customer traffic to it for ordering.  Doing nothing, will mean traffic will be slow to build. However, with a little effort, restaurant’s can convert many of their customer’s to the ordering platform. Below is a serious of tips that can help make this happen: 

·         Choose a well rated online ordering partner. Investigate and see who they work with, how long they have been in business and what their product can do. Don’t be driven by price because not all systems are the same. Look for one that has tools that allow for menu management, couponing, feedback, etc.  It is important to choose a processor that is reliable and experienced, not one that just has a low cost.

·         Execute well.  Even if the online ordering works well, if the order is made wrong or late, the restaurant customer will associate the poor experience with the online ordering. If this happens, the customer will be less likely to order online again.

·         “Order Online” at yourrestaurant.com must be largely displayed on the menu and any printed materials. Flyers and stickers also work well.

• Give customers a reason to order from the website. For example, perks such as 10% off the first online order or a $5 loyalty coupon for every 10^th order could easily be programmed into most systems.
• Make sure the online ordering system allows for customers to leave feedback and can send ecoupons. By being able to hear from customers who have had poor experiences, restaurant managers need to easily be able to respond with an ecoupon (again, driving customers online).
• Make sure search engine listings are correct. Google offers a free local listing. Additionally, some keyword advertising can help ensure the restaurant website comes up when customers search online.
• If a phone message is being used at the restaurant, this message is a great place to let customers know they can now order online.

Many operators still don’t recognize the value of online ordering. However, once they get their first few online orders, they begin to reap all the benefits.  Customers are spending more money, the staff is making fewer mistakes and, employees are off the phone doing other tasks and the restaurants’ website is now producing tangible sales.  With a strong provider, proper marketing and good execution, owners are finding that having customers order directly from the restaurant’s website is just good business.

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You are at war and you probably don’t even know it. The portals of the world are taking your customers and driving them to their sites to order. In so doing, this is costing restaurants millions.

Here is how they are doing it:

• They are setting up Google keyword campaigns (for pennies on the dollar) to drive customers to their sites when your customer does a search for your restaurant.
• They are building websites they own and having customers believe it is your website when they order.
• They are letting you use their online ordering engine at your website. In turn, they are now branding their portal to your customer.
• They take your customer’s email information that came from ordering from your website and now market their portal back to them constantly. This customer, who once came to your website to order, now goes to the portal to order. There they see other restaurants from which to order from, possibly driving your sale elsewhere.  Even when the customer orders from you, you pay a high processing rate.

The single most common question we receive at iMenu360 from restaurant owners “is how do I get these customers to order from my website?”  While there is no quick solution, restaurants that do the following have successfully started to win the battle and get their customers back:

• MAKE SURE YOUR WEBSITE TAKES ONLINE ORDERS. You must have a private label system that allows your customers to order directly from your website and allows you to own the email data exclusively. If you don’t have an online system on your site, customers who want to order online will go somewhere else to place their order.
• Order online at yourrestaurant.com must be largely displayed on your menu and any other materials you print.
• Give them a reason to order from your site. For example, 10% off a first online order and a $5 loyalty coupon for every 10^th order can easily be programmed into your system.
• DO NOT GIVE THE PORTAL ANY DISCOUNTS OR COUPONS FOR THEIR CUSTOMERS.  It should always be better when a customer orders from your website. Also, don’t advertise for the portal at your restaurant. The reason they give you free stuff is so they can drive customers to their site.
• Let your customers know you have online ordering. Flyers and stickers work well.
• Execute well. If you do a good job with execution customers will continue to order online.
• Respond to feedback. The iMenu360 system allows for customers to send you comments and allows you to send them an ecoupon if they had a negative experience.
• Enhance your listing on Google. It is free and it’s a great way to show up #1 when customers search for your restaurant on the web. Click on this link and spend the 5 minutes needed to enhance your Google listing.

Smart operators are figuring out that having their own online system is a must. While we were easily enticed by the opportunity to get new customers for only 10%-15% of our sales, we soon learned that this came at a high cost. This war can be won, but it all starts with having a strong online ordering solution at your website. Once you have a solution in place and you market and execute well, your customers will find that ordering online from your website is easy and your business will benefit greatly.

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The yellow pages are dead! If a customer wants to find your restaurant, most everyone now uses a search engine. It is very easy for potential customers to go to the computer and enter your restaurant name for pertinent information (menu, hours, ORDERING ONLINE). Most searches are done by using Google (71% of all searches are done this way). When your customer wants info about your restaurant and you don’t come up, you are missing out and could be losing sales. Google has created a tool that is completely FREE and it allows you to make sure your business comes up near the top of the page by enhancing your listing.

Besides getting your website and information available to others, you must protect your turf. Competitors and food portals (Grubhub, Campusfood, Delivery.com, etc.) are trying to redirect your customers to their site! Many of them are using keyword advertising which allows them to be shown at the top of the Google page when your customer enters in your restaurant name. If you don’t show up, your customer will go to their site and potentially order from there. The pennies these portals have paid for this to happen could cost you a customer. Most certainly, if the customer decides to order using these portals it will cost you more money.

Additionally, sophisticated competitors are also using keyword advertising to try to grab your customer. Here is how it works. A competitor pays Google so they can have their ad show up when someone types YOUR RESTAURANT name into Google search. This means a customer looking for your restaurant may find your competitor. By enhancing your Google listing, you will be more prominently displayed when someone searches for you online.

Google has recognized that competitors and portals are trying to take your customers and has given business owners a great FREE tool to get your listing to the top and displayed prominently.. Click here for a link that will get you started. It takes 5 minutes to set up and you will see results immediately.

Filed under: David Litchman, Portals | 1 Comment »

Times are tough and restaurant owners are not immune to the rough environment. High fixed costs and fierce competition force the restaurant owners to do whatever it takes to increase the business volume, making them vulnerable. Just as loan sharks exploit the vulnerable, some restaurant portals have come up with similar strategy to exploit the vulnerable restaurant owners. Unless you - the restaurant owner - are vigilant, you will be a victim. Read more »

Filed under: Atul Shevade, Online Ordering, Portals, Web Strategy | No Comments »

Online ordering is critical and nothing can over state the importance, particularly if you are interested in catering to the coming generations. Over the last 12-18 months, we have observed a growing number of restaurant operators who find themselves in a sticky situation. Many “Restaurant Operators do not OWN their URL”. This is a disaster and operators need to understand the importance of it, if they are remotely interested in safeguarding their brand and/or existence on the web. Read more »

Filed under: Atul Shevade, Authors, Online Ordering, Web Strategy | 3 Comments »

OK! you now realize that it is imperative that you take online orders at your website. However, the fact - as of now - is that many customers are using Portals to place their online orders. The customers probably like having a choice of restaurants and the Portal brand is very strong. Before conceding that “Portals are a necessary evil”, look carefully … YOU might even be helping the Portals unknowingly by advertising for them to YOUR customers!

Here is an example:

Occasionally, I love to walk the streets of New York and pop into restaurants that are taking online orders or intend to take online orders. In New York (I love New York!) some of the restaurants allow Seamless Web to put bright red stickers on the restaurant doors stating “Order online at Seamlessweb.com”. In Chicago, I have seen delivery.com give restaurants free plastic bags for their food for delivery or pickup. On the side of the bag it says “Order online at Delivery.com”.

I was amazed that restaurant owners do not seem to recognize the serious consequences of these seemingly benign gestures. I guess the restaurant owners fail to think beyond free bags and colorful stickers! Let me ask you (the restaurant operator) a simple question: Will you allow an employee in YOUR restaurant to wear a T-Shirt with your competitor’s logo on it that says “Go try my competition”? Well the bags and stickers effectively say that!! Orders from portals are costing you money and - more importantly - customers!

Read more »

Filed under: Authors, David Litchman, Online Ordering, Portals | 3 Comments »