A recent Deloitte study showed that 76% of British adults own a smartphone but only one in four actually use them to make a conventional phone call in any given week.
Mobile capability has an increasing impact on pubs, both in how they’re run and how they engage with customers. Managers can monitor and re-order stock, track staff activity through the tills, generate advertising and select the music they play from their phones, while touch-screen tablets have reinvented order taking, inventory control and billing.
Customers can use phones to book tables, pay for their meals and tell the world what they thought of you and your business.
Given the pace of change, it’s little wonder that the even the experts find it hard to predict the future. As a report for the Payments UK trade association says “to make firm predictions about developments in 15 years’ time is folly. Will there be payment technologies and services we haven’t even imagined yet? Almost certainly”.
Given that, what are the technologies that licensees should consider now to help future-proof their pub?
Key points
- Take technology seriously, developing a coherent plan and evaluating options, rather than dabbling with the latest ‘new thing’
- Invest in tech that will genuinely help drive profit, not just those that tick boxes on service provision
- Use your imagination to explore how you could adapt existing technology to make your business stand out
- Tailor solutions to suit your audience and particular types of customer group to drive loyalty
Contactless payment
Payments UK expects contactless payments to drive a drift away from cash and account for 14% of all transactions by 2025 — from 2% currently — led by young consumers.
Last year’s Always On-Trade report by mobile ordering app Orderella and the Association of Licensed Multiple Retailers found that 19% of people have made contactless payments in hospitality venues, rising to 31% among 18 to 24-year-olds, yet four in 10 outlets do not offer the facility.
Even payment cards are under threat, with app-based systems such as Google’s Android Pay and Apple Pay driven by ‘near-field communication’ software, taking contactless on to devices, with a long-term vision to relieve consumers from the burden of having to carry a wallet.
The next development stage is likely see a refinement of the use of biometric anti-fraud measures such as fingerprint, iris, voice and even pulse recognition.
Consultancy company Consult Hyperion suggests that bank-supported systems such as Pingit, Zapp and Paym — currently used mainly for banks transfers between individuals — will play a bigger role in high street transactions in future.
For the traditionally cash-fuelled environment of pubs, contactless has huge potential benefits by taking staff away from taking cash to improve service levels in other areas, but says Consult Hyperion, “we are not predicting the death of cash any time soon”.
Mobile ordering
Like contactless, there’s a gap between what mobile ordering can do, and what operators currently allow it to. The Always On-Trade says 7% of customers have ordered food or drinks on a tablet device but just one in four pub businesses capture orders electronically.
Apps like Orderella and Flypay are potential game-changers in this arena.
Flypay allows customers simply enter their table number into the Flypay app, then split the bill and pay without finding a waiter. It can also be used to divide the bill among groups and provide click and collect for takeaways.
Ali Rees and Phil Neale run high-tech London pub the Thirsty Bear on the South Bank, and sell their iPad ordering system and self-service beer walls to other venues.
Mark Jones, owner of Dirty Bottles in Alnwick, Northumberland, says a self-serve walls of its craft beers taps that customers use with a pre-paid card, and booths with iPad ordering, have helped increase trade sixfold. “The self-service technology has become a big draw,” says Jones. “If you’re a group out for cocktails, the bar might be busy and you could end up stood waiting for 20 minutes. With iPad ordering, you’re sat in the booth, you can order while talking to friends and we see more sales.”
Loyalty and promotions
Free Wi-Fi has become the standard for hospitality businesses. A 2013 survey by Casio bemoaned the fact that only a third of pubs offered free Wi-Fi — by 2015, the ALMR found that this had risen to 94% among its members.
Danny Williams, head of wireless and security at Wi-Fi network supplier Prodec, says pubs need now to start looking beyond the fact they provide the service.
“Hospitality businesses should increasingly be thinking ‘what’s in it for me?’, such as using the information you gather from your analytics to tailor individual offers. It’s become as much a subject for the marketing department as it is for the technical team,” he says.
Simon Stenning, executive director of MCA, says: “Our 2016 Pub Market Report showed that loyalty is the second highest ranking factor [after the food offer] that consumers say influences their decision on whether to go to a pub. That’s where operators need to use technology to interact and engage with customers better.”
Apps can be integrated with customer relationship marketing systems to generate bespoke offers or build loyalty programmes, but pub operators can also do this with their own analytics data.”
“Supermarkets have been doing this for years,” says Clive Consterdine, Zonal Retail Data Systems’ sales and marketing director. “But many pubs now have the ability to target their promotions to meet their customers’ desires, rather than run costly blanket offers.
“If a customer is signed up to your app, you can tell through beacons their estimated time of arrival, whether in a pub down the road or have just entered your venue. Knowledge is power, but only if you take the time to understand it and focus your campaigns accordingly.”
Wireless charging
Flat batteries are the enemy of free Wi-Fi, which has led the likes of Starbucks and McDonald’s to introduce wireless charging points at selected UK sites. Wireless charging company Powermat found that four out of five people were more likely to visit a venue that offers wireless charging and 56% would spend more while there.
Communications manager Amy McDowell says: “When customers lay their smartphones on a charging point, businesses can send them messages such as special offers, surveys and in-store deals that can help generate loyalty and drive a second purchase.”
Future watch
The first vending machine that communicated stock levels to its operator went live in 1981, so the iKeg automated beer reordering and supply chain management system developed by US start-up SteadyServ and Intel has, in some ways, been a long time coming.
The system uses weight sensors and beer ID tags on kegs to eliminate the built-in time lag of manual ordering, potentially reducing out-of-stock items and improving inventory management.
The so-called “internet of things” could take things further. The concept — of a network of connected objects rather than the web of connected people we’re familiar with — is usually thought of in domestic terms, such as mobile control of items like thermostats and washing machines.
Hospitality applications are largely waiting to be discovered. Williams at Prodec says: “You could link your stock control to weather information systems, for example, so that orders of certain products might be increased because you know there’s going to be an uplift in demand.”
It could also, say, link tablet self-ordering to music selection, giving customers a say in the atmosphere of the venue as well as their individual experience. “This is the stuff that’s really feasible,” Williams adds.
Interactive touch-screen tables and smart beer pumps that make beer on demand to a customer spec are also being touted.