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How E-Commerce is Impacting Bars and Restaurants

  • by: Maggie Mahar
  • On: 17, Mar 2020
25 min read

E-commerce has changed the way consumers shop -- that’s hardly news. From everyday retail to niche product needs, there’s an e-commerce solution for just about everything under the sun. It’s easy to think that restaurants and bars are the exceptions to this, though. After all, you can’t get your favorite Manhattan or Old Fashioned off of Amazon (yet). But, e-commerce is actually impacting the Food and Beverage industry very quickly, in ways that are easy to miss and would have been impossible to predict just five years ago. That’s not to say e-commerce is going to put the restaurant industry out of business, but restauranteurs and bar owners certainly need to respond and adapt to the increasingly varied consumer landscape. Today, we’re going to discuss a few ways e-commerce has impacted bars and restaurants around the world, and suggest a few ideas for how to handle that change.



Food Delivery (Grubhub, Uber Eats, Etc)

While we won’t say that food delivery services are going to steamroll the idea of a sit-down restaurant, they are absolutely informing and shaping the way consumers interact with restaurants. Firstly, this adds more competition to an already competitive industry. All of a sudden, being physically close to your customers isn’t enough to drive sales. With meal delivery services, customers can select from a wide range of restaurants in their area, and the food will arrive at more-or-less the same time.

To cope with this increasingly difficult market, restaurants should look to double-down on their specialties and brand identities. These are the things that create customer loyalty, which is perhaps the single-most valuable commodity in a crowded marketplace.

Another consideration is the lack of quality control involved with these food delivery services. For example -- a customer orders french fries through Grubhub or Uber Eats from your restaurant. As french fries sit, they lose that all-important crunch. Fast forward 30-45 minutes from the time you’ve made their order, and those french fries are going to be soft, soggy, and potentially cold. Now does the consumer blame your restaurant or the concept of a food delivery service? They may never visit your establishment after the poor experience with their delivery, which came from something well out of your control.

When it comes to food delivery services, we suggest being very careful about what is available through delivery from your restaurant. If you have menu items that need to be served immediately, leave them off the delivery menu. After all, it’s better to serve no food than bad food.

At-Home Liquor Delivery

In a similar vein, services like Saucey and Drizly offer consumers the ability to have bottles of alcohol delivered right to their doorstep. While convenient to the consumer, it can leave some bar owners just slightly “off the pace”, as it goes. With home delivery of spirits, liqueurs, craft beers, and more, bar owners need to think outside of the box to keep the sales coming in.

At Provi, we always champion the idea of giving consumers something they can’t create at home. Thanks to the cocktail renaissance, that has become easier than ever. By diversifying your cocktail lists to include signature drinks and house specialties, you can provide customers with options that can’t be made at home -- no matter how much they order through Drizly.

Outside of the drinks, this can give bars and restaurants another reason to focus on ambiance and decor. It’s easy for these to sometimes fall by the wayside, but with ever-increasing options for consumers, the atmosphere of a restaurant is more important than ever. It adds to the experiential nature of your bar, which is something that Saucey or Drizly simply don’t offer.

Although slightly more niche than standard alcohol delivery services, there are also several ‘tasting box’ subscription packages for spirits, wine, and beer enthusiasts to enjoy. To provide customers with an alternative to these, bars should consider hosting their own monthly or weekly tasting events or classes. These can add again to the overall experiential quality of your establishment, creating long-term bonds between you and your customers.

Mealkit Services

Similar to food and alcohol delivery, meal kit services like BlueApron and HelloFresh offer customers an e-commerce option for getting high-quality food and wine at home. They are increasingly popular options, especially in urban areas, and are often marketed as an alternative to going out or eating out.

However, this is where the ambiance and experiential aspects of a restaurant or bar can really shine. At the end of the day, a BlueApron meal can generally only be enjoyed from home. By focusing on the atmosphere and customer service of your establishment or bar, you can give customers a reason to ditch the meal kits and keep coming back.

Mobile Phones as POS Systems

Today, mobile phones are the new point of sale, and looking forward, they will probably become the most used one as well, considering the cultural penetration of mobile technology. For many casual, quick-service restaurants or bars, mobile POS systems and mobile ordering are already well underway. These POS systems can often interface with optional mobile apps that provide users with near-endless capabilities. These can include user preferences, allergies, dietary concerns, user location, and more. All of these capabilities and options create an intuitive, hassle-free way of ordering for a customer.

While these mobile apps and POS systems are currently mainly used by big-name corporations like Starbucks and Subway, it’s only a matter of time before locally-owned, fast-casual eateries and watering holes are expected to keep up.

There’s More to Come

The cold, hard truth is that this is only the beginning of e-commerce’s role in shaping the Food and Beverage landscape. Every week, new platforms, services, or products are created to enrich and simplify the customer’s life. Food and drink are huge (and increasing) parts of the average consumer’s budget. For those of us in the restaurant and bar world, that can absolutely spell opportunity, if we are able to harness and adapt sufficiently.

 

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