Overview
Ordering for both collection and delivery has seen exponential growth in recent years, driven by changing consumer preferences and improvements in the tech that enable the services. Lockdown restrictions have pushed this growth further still as hospitality operators pivot away from dine-in toward takeaway and delivery - many for the first time.
Online ordering is shorthand for order for collection and order for delivery. While the way the order is placed might be similar, the means of fulfilment can be very different. Order for collection generally means the local branch is responsible for some element of pick, prep, pack and dispatch, and the available market is constrained to a small radius around each store. Order for delivery means operators can serve a wider area, often by employing so-called dark kitchens to fulfil orders. This makes scaling much easier and stops delivery drivers cluttering up restaurants, but it might mean venues are unable to use spare kitchen capacity to fulfil orders.
The timing expectations for online orders can vary considerably: grab-and-go operators who focus on breakfast and lunch will typically only receive orders for immediate delivery or collection. Casual and fine dining restaurants might get a mix of orders in advance (a well-planned meal delivery to coincide with movie night) alongside orders for immediate fulfilment placed by hungry commuters or late-night office workers. Operators who also include a retail grocery offer, as many operators are now doing to make up for lost revenue, can expect most orders to be scheduled for collection at a specified day/time. It's really important to understand exactly how and when your business will fulfil online orders, to ensure the customer journey is frictionless and you don't create bottlenecks or single points of failure in your operational teams.
Before deciding to accept orders online, you first need to be clear on the true margins you make on every dish. It can be easy to be distracted by promises of high volumes, but if the online ordering partner takes a fee from every order, you could find yourself ‘selling tenners for a fiver’. Grocery delivery companies experienced a similar issue when desperately trying to capture market share. Better to sell smaller volumes and make a small profit than sell high volumes and make a loss.
Many operators build their own online ordering website or app, working with specialist companies like Vita Mojo to create a robust, secure service that reflects their brand. This is often known as a 'white label' approach, where you apply a top layer of fonts, colours and visual assets to an existing 'back end'. These can be set up in as little as a few weeks, and can be very affordable, but design can be constrained by the limitations of the platform.
Online ordering platforms
As an alternative to building your own website or app, many operators also partner with an online ordering platform (see below). Working in this way has two advantages. First, you're positioning your business on a platform your customers already use, so acquisition costs are lower. Second, you can be up-and-running almost immediately. The drawbacks are that your customer may be tempted by another restaurant’s listing when they see it next to yours, and the commission fees can be very expensive. Many operators hedge their bets by operating their own ordering website alongside a listing on one or more online ordering platforms. This ensures all bases are covered, but can result in operational complexity and a fragmented view of the customer.
Online ordering platforms can be divided in two:
Aggregators (like JustEat) are listings websites for food retailers with existing delivery capabilities (or that only offer takeaway). You sign up and customers can find your restaurant by searching for something near them that meets their criteria. Orders come in for you to cook and deliver (or for customers to collect). This approach makes sense when you already have drivers and vehicles, but want to increase your exposure.
New delivery companies (like Uber Eats and Deliveroo) provide the delivery infrastructure so you don’t have to. These companies have massively opened up the market to ‘traditional’ restaurants that didn’t offer delivery. They lower the barrier to entry dramatically; a restaurant can instantly offer a delivery service with no investment in drivers or vehicles. Unfortunately, this can mean a queue of delivery riders waiting to pick up orders in a restaurant that wasn’t designed to accommodate them, which can negatively impact the experience for existing diners. And, while it should be more efficient to outsource the delivery to a third-party, the commission fees can be high.
These platforms are often collectively known as ‘aggregators’, though it’s important to be clear on the difference. If you have (and want to keep) your own delivery function, you only need an aggregator. If you don’t have a delivery capability, or want to outsource it, you need a new delivery company.
Finally: each of these services is typically enabled by an app running on a tablet or mobile device in-branch. If you sign up with more than one, you may end up with several tablets or devices on the go, which can take up a lot of space and cause confusion for team members. If you can, stick to one partner. They may reward your exclusivity with a lower commission, and you'll reduce the risk of orders getting lost or duplicated.
If you have an existing online order fulfilment capability, you might not want to integrate very closely with an external partner - if the customer orders through your website, you pay nothing, whereas if they order through a partner, you’ll pay a commission. Where you work with a new delivery company and they have a different delivery radius to you, this can become very complicated and requires serious planning.
Critical functions
Your online ordering website or app should include the following features:
A simple, intuitive user interface that aids discovery and enables upselling
A mobile-first, device- and platform-agnostic solution (i.e. the site works perfectly on mobile devices of any size, and/or the mobile app is available for Apple and Android devices)
Powerful reporting functions to enable you to understand things like peaks and troughs in demand, high performing dishes, cost to serve and so on
When selecting a partner to work with, you should ask them how orders will get from the customer's device to the kitchen. You may need a live inventory system to manage sales, and/or a means to throttle demand with time-slots so you don't exceed production capacity. The goal should always be to avoid manually retyping orders, as this is where most mistakes are made.
Important integrations
The most important integration is with your kitchen. Think carefully about how you will fulfil online orders, in terms of kitchen production (how do orders get made) and inventory management (how does your ordering service know what you have available).
In your front of house area, where will orders for collection be placed? Who will be responsible for accepting and processing online orders? Your online orders will need to integrate with your POS system (so you don’t have to manually rekey orders), and so you can reconcile sales and inventory.
Your online ordering service also needs to integrate with your social channels (so customers can buy and recommend, or be prompted to buy) from their news feed.
Ideally, you’d want to capture all the data about your customers from the partner you work with. However, you’ll almost certainly find the data is theirs, not yours. Even though some will allow you to target customers with limited campaign capabilities, it’s rare that you’ll be able to migrate customer data into your own CRM system, so you're unlikely to get that elusive ‘single customer view’ when you work with a partner.
Users
Your existing customers
Prospective customers, who may find out about you via an aggregator or delivery company
Someone to manage your presence on each service (probably a head office function if you have multiple outlets)
Someone in the restaurant (maybe a shift leader or manager) who can manage the availability of individual dishes, or even the whole venue; if the restaurant is getting slammed, you might want to focus on in-person orders rather than risking poor service by accepting orders for collection or delivery, so there may be times you need to go 'offline'
