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McDonald’s Corporation (MCD), Starbucks Corporation (SBUX): How Restaurants Are Using Technology to Drive Business

Technology is changing how the food industry does business. From tabletop tablets to interactive mobile apps, restaurants are finding better ways to get customers to spend more. Brinker International, Inc. (NYSE:EAT)‘s  Chili’s Grill & Bar is the latest casual-dining chain to capitalize on this trend. The company has been testing pay-at-the-table screens by Ziosk that let customers order food, play games, and pay the check without the need for a waiter.


Tabletop technology should boost sales for the company because guests at tables with these devices tend to spend more per bill, according to Chili’s senior vice president of brand strategy. In fact, dessert sales increased as much as 20% when the screens periodically showed photos of desserts. That’s an impressive figure, particularly if Chili’s is able to apply this strategy to alcoholic drinks and other higher-margin menu items.

There’s also an opportunity for restaurants to make additional money on the games the devices offer. Guests at Chili’s will be charged $0.99 to play a game. Chili’s gets to keep 50% of that gaming profit, with the other half going to device maker Ziosk. That seems fair considering Chili’s only rents the tablets and their technology from Ziosk. The devices are already being used in more than 150 Chili’s locations across the Midwest and in Virginia and Maryland.

Chili’s is expected to roll out the tabletop screens as early as next year at most of its remaining 1,266 restaurants, according to The Wall Street Journal.

Still, Chili’s isn’t the only casual restaurant chain using technology to drive sales. Applebee’s, which is operated by DineEquity Inc (NYSE:DIN), is also testing tabletop tablets from Ziosk, along with others from Presto and eTab. Such on-table screens also allow restaurants to collect data about their customers, such as survey answers and email addresses.

Ziosk’s devices, for example, include a real-time review tool called zSurvey. A chain like Applebee’s could then use real-time feedback collected by the device to improve the customer experience at its restaurants. Moreover, Ziosk reports that “over 7% of guests opt-in to zSurvey without incentive where traditional printed receipt methods yield less than 1%.”

Technology at the table
While this technology isn’t new, it’s become more commonplace in the restaurant industry today. In fact, more people are embracing the idea of technology at the table than ever before. The National Restaurant Association reports that 44% of adults say they would use a self-service device to order if it were offered at a quick-service restaurant. Yet technology’s role in the restaurant industry isn’t limited to third-party devices.

Other companies are using mobile apps to compel customers to spend more. Mobile payments now account for 10% of in-store purchases at Starbucks Corporation (NASDAQ:SBUX) locations in the United States. Starbucks Corporation (NASDAQ:SBUX) customers have the option of paying with their smartphone using the Starbucks Corporation (NASDAQ:SBUX) app or Square Wallet app. The coffee house chain invested $25 million in the payments processor last year and has since deployed Square’s technology at thousands of Starbucks Corporation (NASDAQ:SBUX) locations.

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