business news in context, analysis with attitude

CNBC has a story about how Pizza Hut, hoping to learn more about its customers, is acquiring QuikOrder, described as “an online ordering software and service provider for restaurants” with which it had a previous vendor relationship - about half of its US sales were processed through its platform.

The CNBC story notes that Deloitte says that “customers who order online increase their spending by 20 percent,” and that Yum Brands, which owns Pizza Hut, believes that “greater access to their data could help Pizza Hut increase sales even more by specifically targeting customers during the online ordering process.”

Data services, “whether they incorporate delivery or not, reap the benefit of having full access to consumer data,” the story says. “ With that data, those companies learn what customers order, when they order it, how often they are using the platform and can leverage it to bolster sales or lure in diners from other services.”

Indeed, the Financial Times has a Pizza Hut story along the same lines - it quotes CEO Greg Creed as saying in an interview that “the future of pizza is in delivery and carry out,” and that within five years, “sit-down restaurants would account for only about a quarter of Pizza Hut’s global outlets — down from more than 40 per cent at present.”

Pizza Hut, the story says, “is planning to shift towards takeaway-centric outlets through new openings and so-called relocations — shutting restaurants and opening delivery stores nearby.”
KC's View:
It won’t affect every retailer, but two trends mentioned in these stories intrigue me. One is the move away from restaurants to pickup/delivery, and the other is the idea that average transactions are higher when orders are placed online.

These probably aren’t isolated to the pizza business, but rather reflect broader consumer behaviors that will carry over to other segments. Leaders in other segments have to ask themselves, “How are we repositioning and preparing ourselves for these customers?”