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Restaurants: ‘There’s an app for that’

Growing number of chains build smart-phone apps for ordering, branding

More restaurant brands are working to say “there’s an app for that” to meet both the growing consumer use of smart phones and the demand for more convenience.

Most recently, Domino’s Pizza, Starbucks Coffee and bd’s Mongolian Grill have introduced new smart-phone apps focused on mobile ordering, nutrition information, mobile payments and brand loyalty programs. Restaurant smart-phone apps also span several types of platforms, including not only Apple devices but also Android-powered phones and tablets.

The goal is to build sales and consumer loyalty, chain executives say, and now is the time to place resources against developing mobile applications.

“I was waiting for these iPhone and smart-phone apps to become more mainstream for restaurants,” Denise Head, vice president of marketing at bd’s Mongolian Grill, a 35-unit stir fry chain. “I feel we’ve turned a corner. I still hear skepticism that you can’t be sure it drives traffic. But we feel we’re at the point where we can put applications in there that drive more sales.”

Ordering up innovation

Much of the early adoption for mobile commerce occurred in the pizza segment, where Pizza Hut got much of the credit for blazing a trail with smart-phone apps. Since its launch in 2009, Pizza Hut’s iPhone app has been downloaded 3 million times, the brand said. Pizza Hut last month introduced versions of its app for Android phones and the Apple iPad.

Domino’s Pizza, meanwhile, said Tuesday it introduced an app for the iPhone and iPod Touch. Customers can use the online-ordering program to access the chain’s full menu, as well as national and local coupons. It also incorporates core functions from Domino’s website, including a location finder and the Pizza Tracker, which updates pizzas’ baking and delivery progress in real time.

“We are committed to making sure we’re connecting with our customers wherever they are, and now that means providing users with the convenience of ordering using their iPhone or iPod Touch,” Chris McGlothlin, Domino’s chief information officer, said in a statement. “The Domino’s app engages customers who are looking for the easiest and most convenient ways to order online, and we’re excited to offer this new option.”

The Ann Arbor, Mich.-based Domino’s Pizza Inc., which franchises the chain of more than 9,000 pizza restaurants, said online ordering averages about 25 percent of sales.

Making mobile pay

Seattle-based Starbucks Corp. most recently rolled out an Android version of its Starbucks Card Mobile App and announced that nearly 9,000 of its locations in the United States would be able to accept mobile payments through the app.

By downloading the tool to Apple or Android smart phones and entering the numbers of Starbucks Cards, users can use the app to load the Starbucks Card with money and pay at nearly 6,800 Starbucks stores and more than 1,000 on-site locations in Target stores, as well as at nearly 1,000 Starbucks units in Safeway stores beginning this July.

The app also lets Starbucks customers check their Starbucks Card rewards status and account balance, as well as find the nearest location. Adam Brotman, vice president and general manager of digital ventures for Starbucks, said the expansion to Android apps and more stores accepting mobile payments is a response to guests asking for a richer, more convenient experience from the chain.

“We’ve received a tremendous number of requests on MyStarbucksIdea [the corporate blog] for a Starbucks app for Android,” Brotman said in a statement. “We’re excited to introduce an Android app that our customers can use as part of their daily routines.”

Brady Brewer, the 16,863-unit chain’s vice president of Starbucks Card and Loyalty, said expansion of the app reflected customers’ interest in a mobile-wallet tool as well as the fact that one in five transactions in U.S. locations for Starbucks are paid for with the Starbucks Card.

“Our customers have shown us that they love the utility, convenience and fun of our mobile apps and especially the ability to pay with their Starbucks Card using a smartphone,” Brewer said in a statement. “My Starbucks Rewards members, in particular, have been quick to adopt mobile payment as part of their everyday visit.”

Counting on the calorie counter

For Burnsville, Minn.-based bd’s Mongolian Grill, a 35-unit stir fry chain, the most important aspect of its GoMongo iPhone app is one of the chain’s website’s biggest differentiators, the Create-A-Bowl option. Users can pick which stir fry ingredients they’d like to see in their bowl the next time they visit bd’s, and the application can tell the guest how many calories the dish would contain, as well as other nutritional information.

Vice president of marketing Denise Head said letting guests preplan their meals on their iPhone, iPod Touch or iPad satisfied one of the biggest needs of the chain’s customers.

“When we prioritized what was important and what we thought guests would want to use, that was at the top of the list,” Head said. “Once we looked at the stats of how many people have smart phones, we said now was the perfect time to launch the app. It’s a no-brainer to incorporate Create Your Bowl, because we had some real avid guests using that on our website.”

Head wants to keep developing the app in stages throughout the year to keep it fresh, and the key functionality that is next to be layered on is bd’s 870,000-person loyalty club, Club Mongo.

“Club Mongo is our No. 1 tool to build sales,” Head said. “So if I can get that in there, it gives guests more reasons to use the app. I’ll spread out the development and strike again to make it a tool that provides even more value.”

She added that bd’s would also derive more value from integrating the loyalty club with the app because “I’m only going to get into things that I can measure.” Now that market research has shown smart-phone usage is prevalent enough to be worth the investment in development costs, bd’s will keep looking to this mobile strategy as an important part of its marketing plans, Head said.

Contact Mark Brandau at [email protected].

Follow him on Twitter: @Mark_from_NRN
 

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