The case for a mobile app for restaurant brands

Restaurant brands of all sizes are making or thinking about making a mobile app in support of their business. Case studies of successful brands that have made the leap abound! If you’re a brand still in heated discussion in the conference room, here are the reasons that may just get you set to launch.

Want the pragmatic point of view? Read our counterpoint: The case against mobile apps for restaurant brands here. In this article, we’ll lay out the affirmative case for moving forward with building an app.

Efficient cost per touch

First and foremost, like any direct marketing channel there is a one-to-one aspect that creates an extremely efficient marketing channel. Through app usage, app-based notifications and triggered emails the cost per touch can be cost effective if properly administered. Especially for small or emerging brands concerned with media waste, this is a value because notifications create a low-cost mechanism for driving cost.

Customers volunteering to hear from you

Outdoor boards, radio spots, television. The customer did not elect to hear from your brand in these mediums. They may take in the message, they may even like it. But there is a barrier to receptivity because it is appearing to them somewhat randomly. Customers who choose the mobile app for a brand they like ask to interact with that brand more. They invite the brand into the device they use the most. How much? 57% of digital media time is spent on smart phones according to comScore.

Great owned media channel

Your mobile app should be the premier media channel. Because it features your brand and only your brand. The intimacy of the app in the customer’s hand make the connection as clear as can be. It’s the next best thing to the smiling face of your staff. Even without opening the app, the app icon on their home screen can help keep your brand relevant and top of mind.

Data. Data. Data. Heard anything about data lately?

A mobile app can build loyalty

For brands with strong traffic and awareness, a well built mobile app is a fantastic tool for driving customer loyalty. Notifications and exclusive offers, along with location based triggers can serve as reminders to customers and help win extra visits. Even without access to a user’s notifications, enticing incentives will help lure guests back in for deals or offers they perceive as valuable. It’s no coincidence that top apps for visited concepts like Chick-Fil-A or Starbucks have strong rewards-based incentives and in-app specials. But thinking a mobile app will drive traffic or loyalty without offers is flawed. Customers are always looking for ways to save, or for special treatment.

A well thought out contact and offer strategy will help keep guests engaged in between visits. Knowing when to message and went to be quiet will earn a lot of respect from customers who are quick to mute unwanted notifications of any kind. But timely offers based on past visits or location will usually be appreciated. A mobile app has to be built and launched with this in mind.

Can capture pre-commited revenue

Calling back the examples of Chick-Fil-A and Starbucks, they both do something amazing that you may not have noticed. Many apps allow users to add a credit card or payment source to the account in the mobile app. But the above apps take it a step further by requiring users to pre-pay funds in to their account. The user is charged before they even make a purchase at the restaurant. This creates a revenue environment similar to gift cards, with a certain subset of guests committed to visit and spend, and another subset which may never claim the products they pre-payed for. From the brand perspective, it’s all upside.

Offer and message testing

Data. Data. Data. Heard anything about data lately? Through careful message testing to users of the mobile app, brands can learn which offers will drive traffic in mass media at a much lower investment. This allows brands to test LTOs as an exclusive without rolling it out system wide. After successful trial on the app, the brand can move forward confidently.

Beyond offers, the brand can also test campaigns, call-to-action copy, visuals or any other creative elements on the mobile app before investing in costlier television creative or even digital campaigns. This allows for more intelligent deployment of funds towards creative campaigns that have already been proven successful with core users on the mobile app.

Geolocation opportunities

Data can also unlock new opportunities by serving messaging to people nearby a location. Serving a notification doesn’t sound all that interesting but serving an offer only to people nearby while a specific location is slow is a valuable tool. This is a serious traffic driving methodology that can delight customers and fill down periods.

As is clear, there are many ways that a mobile app can move business forward. Want the more pragmatic point of view? Read our counterpoint: The case against mobile apps for restaurant brands here.

The case against mobile apps for restaurant brands

The conversation inside every restaurant brand about apps is heated. There are technology providers, white label solutions and solo coders trying to sell your brand an app. Despite the glossy sales pitch, there are some things you should know about building in app. They definitely aren’t for everyone. Here, we lay out the case against building an app, and the ways to build traffic and sales without one. Want to hear the flip side? Read the companion piece that makes the counterpoint: The case for mobile apps for restaurant brands. On with the negative case.

An app won’t generate new customers alone

For every brand, driving customers into the restaurant is the lifeblood of your business. As marketers and operators, we tend to look at every new tool as if it can drive our business. It seems we are always one tool away from cracking our business wide open. Here’s the fact – no restaurant brand has successfully launched an app that wasn’t already having success. Vendors celebrate the successful case studies like Starbucks or Domino’s. Those brands were doing just fine in the traffic department prior to launching apps that were specifically designed to improve frequency and loyalty from their legions of customers. Brands think they can launch an app without including rewards or at least special offers are not being honest with themselves. If incentivized, intelligent discounting isn’t part of your plan, do not expect mobile apps to drive trial unless the app is truly ground breaking.

A growing number of mobile users report downloading zero new apps per month.

90% of mobile usage time is in apps.

This may sound like a pretty pro-app argument. The reality is that those apps are well established corporations investing billions into user acquisition and ongoing engagement. Congratulations, your brand will now be competing against Facebook, Google, Snapchat, Pandora, Netflix, Amazon, Apple and every media and entertainment company for screen real-estate. Think your brand is as much fun as Candy Crush?

Fewer app downloads every month

Despite the dominance in usage of mobile apps on smart phones, people are seeking out few new ones. According to comScore, new app downloads per user are trending down. In fact, a growing number of mobile users report downloading zero new apps per month. This means the battle for real estate on the home screen is getting more and more serious. How serious, half of all smart phone users fall into this zero app category.

Without serious innovation it won’t drive awareness or usage

Go ahead an try any five restaurant apps for brands you never use. They likely have the same feature set and he same set of flaws. If you’re not familiar with the restaurant, the app does little to drive a visit or a sale. People inside many brands believe the mere creation of the app will be newsworthy. It won’t. To break through with consumers, the app has to offer a truly interesting experience. That might mean a novel design or an integration with the store.

Are you prepared to market mobile apps?

In many cases, brands tell us the app is a solution to the problem of low awareness or increased competition. If you’re already challenged by marketing this new app will create a new problem. The app is a product of its own. Like any product it requires a marketing plan, a budget, support and maintenance. That’s a full-time commitment. Many brands looking to the app as a savior know how hard successful launching a string of LTOs can be. Marketing the app is no simpler.

Think social media blows up when there’s a problem in one restaurant? Wait until someone has a malfunctioning app in their hand. The app is not just an extension of the brand, a successful app can become the brand – and that is a double edged sword. Spend some time on the app store to see how competitive listings are for mobile apps. Seems almost as tough as marketing a restaurant, no?

Wide adoption of mobile web

Over two years ago, the number of smart phone users surpassed the number of desktop computer users. Not only are more people than ever using smartphones to browse and shop, but this tells us that more technology investments are being made to improve the basic infrastructure. The mobile web has arrived and is getting stronger everyday. This means that having a great mobile website will accomplish most of the things the average brand hopes an app will do. At least it will provide proof of concept that your customers want an app.

True, a website will lack some of the functionality for loyalty, but testing guest interest and understanding usage patterns on the web will allow you to design and build a more useful app. A mobile website will also allow for use on iOS, Android, Windows, Blackberry and any other platform out there and keep brands above the fray between mobile payment services.

As you can see, much consideration must be made before leaping into development of an app. The investment of time, resources and of course money are critical. Want a look on the bright side? Read the companion piece that makes the counterpoint: The case for mobile apps for restaurant brands.