Burger King Owner Sees Drive-Thru Hold Back Digital Transformation
As Restaurant Brands International (RBI) looks to reach 100% digital sales, the drive-thru channel remains a sticking point. The quick-service restaurant (QSR) giant, which owns Burger King, Tim Hortons, Popeyes and Firehouse Subs, shared on a call with analysts Friday (Nov. 3) discussing the company’s third-quarter 2023 financial results how its goal of reaching digital entirety is […]
The post Burger King Owner Sees Drive-Thru Hold Back Digital Transformation first appeared on PYMNTS.com.
As Restaurant Brands International (RBI) looks to reach 100% digital sales, the drive-thru channel remains a sticking point.
The quick-service restaurant (QSR) giant, which owns Burger King, Tim Hortons, Popeyes and Firehouse Subs, shared on a call with analysts Friday (Nov. 3) discussing the company’s third-quarter 2023 financial results how its goal of reaching digital entirety is held back by the channel.
“My point of view is, we can get this business to 100% digital. We should have all of the order-taking done through digital channels over time,” Josh Kobza, the company’s CEO, said. “We’ll have to see exactly what that looks like, especially in a drive thru, but I think that’s … our North Star. … We have that in quite a number of our restaurants in international markets, and it really improves the operation of the whole restaurant.”
Moreover, CFO Matt Dunnigan added, the two executives observed that in Paris, where there are no drive-thrus, the company has some stores that are fully digital, being “100% kiosk,” and at these locations, it is “so much better of an experience” for consumers, in-restaurant employees and the company’s margins.
“We’re going to be going as rapidly as we can, and frankly you’re going to see it with other players as well, because … it’s a better way to do business,” Dunnigan said.
In fact, when it comes to that digital transformation, RBI is somewhat behind major competitors. Kobza noted that, while the company saw a more than 40% year-over-year increase in digital sales, digital mix was 14%, a share that goes up to 28% for company-operated stores, because of the rollout of kiosks.
In contrast, McDonald’s shared on its earnings call Monday (Oct. 30) that, in its six leading markets, its digital sales mix exceeded 40%. Plus, Yum Brands, which, like RBI, has also spoken publicly about its goal of reaching 100% digital sales, shared in its earnings report Wednesday (Nov. 1) that its digital mix amounted to more than 45%.
Across the QSR industry, brands have taken a number of different approaches to digitizing the drive-thru experience. Many are rolling out two-lane concepts, with one dedicated exclusively to picking up mobile orders. Yum Brands’ Taco Bell, for its part, is trying out digital check-in screens.
In fact, consumers are interested in a more digital drive-thru experience. The June installment of PYMNTS’ “B2B and Digital Payments Tracker®: Inflation Puts Technology on the Menu for Restaurants,” a collaboration with American Express, highlighted a study revealing that 70% of restaurant customers want technologies such as personalized menus incorporated into the drive-thru.
Overall, consumers are engaging with restaurants across their connected devices. Research in PYMNTS Intelligence’s study “Consumer Interest in an Everyday App,” created in collaboration with PayPal, revealed that, among the 73% of U.S. consumers who had made a restaurant purchase in the previous month, 1 in 4 did so exclusively using internet-connected devices. Plus, another 36% were omnichannel customers, engaging both via traditional channels and via connected devices.
The post Burger King Owner Sees Drive-Thru Hold Back Digital Transformation first appeared on PYMNTS.com.