Square Study Shows How Retailers and Restaurants Are Adapting to Changes in Consumer Behavior and Turning to Technology To Get Back on Track in 2021
Today, Square released a new report that reveals how retailers and restaurateurs are taking control of the future by delivering on customers’ evolving expectations — with an intentional focus on technology, operating efficiency, and customer experiences. Square developed the Future of Restaurants and Future of Retail reports to provide a snapshot of what businesses are investing in and what’s working.
To uncover these insights, Square collaborated with Wakefield Research to survey restaurateurs, retailers, and consumers across the U.S. Additionally, Square spoke to businesses and industry experts to share how retailers and restaurateurs are facing challenges, embracing innovative solutions, and forging new paths forward in 2021.
“Scrappiness is in our sellers’ DNA and, in 2021, we’re expecting more of the same. It will be more important than ever to find creative ways to meet consumers where they are most comfortable, providing memorable experiences in-store, online, curbside, and everywhere in between,” said Alyssa Henry, Seller Lead at Square.
For example, after chef Anthony Strong closed his popular San Francisco restaurant Prairie last August in the wake of COVID-19, he didn’t give up. He emerged a couple months later with a new concept: He transformed his 1989 Volkswagen van into a mobile dining room, traveling the city to serve up a four-course “glamping” dining experience. While shuttering Prairie was devastating, Strong did what entrepreneurs have done time and again - got back to work and innovated in the face of adversity.
Overwhelmingly, the report found that restaurants and retailers alike are undertaking big changes to existing strategies and adopting new technologies to stay ahead of the curve. For example, we saw retailers increasingly turning to online and social selling to continue serving their customers - in fact:
- 88% of retailers are now selling online
- For retailers with one location that sells online, 66% of their revenue comes from online sales
- 84% of retailers who sell online either already sell on social media or plan to this year
- Among retailers selling on social media, __40% __of their online revenue comes from social selling
- Online shoppers bought an average of eight products from social media sites directly in the past month, at the time of this survey
- 74% of retailers plan on using real-time inventory technology this year
- 72% of consumers prefer delivery over pickup, but only 37% of retailers plan to offer same-day delivery.
“Retail has changed rapidly over the last year,” said Square’s head of eCommerce, David Rusenko. “But the transformation is giving retailers a chance to slow down and invest in doing things smarter across both in-store and online channels. The changes aren’t a way to simply make it through - they’re permanent and redefining what a meaningful retail experience can look like.”
And it’s not just retailers who are seeing massive shifts in 2021, restaurants are also fundamentally reimagining the way they do business to keep their operation running smoothly, improve their bottom line, and continue serving their customers.
- 91% of restaurants have made, or plan to make, investments in kitchen automation technology.
- Restaurants expect 62% of their revenue to come from takeout or delivery in 2021.
- 58% of restaurants prefer to use their own app or website for delivery.
- Nearly half of restaurant owners or managers plan to continue offering digital menu access using URL or QR codes in 2021
- 3 in 4 restaurants plan on offering contactless ordering and payment options across all channels, with 61% utilizing contactless payments on-premise
- 42% of restaurants plan to invest in customer loyalty programs
Restaurants that are using online ordering for delivery and takeout expect
- 62% of revenue to come through those online channels
- 67% of consumers prefer to use a restaurant’s own website or app for food delivery
- 92% of restaurant owners and managers are open to experimenting with their menu
“We’re seeing restaurants shift to a model that places more emphasis on the kitchen as the central hub of the operation,” said Bruce Bell, head of Square for Restaurants. “Restaurants are embracing new channels for customers to interact with their business, effectively meeting them wherever they are. Each of these channels represents a revenue stream for the restaurant and they connect to the same kitchen and are all managed by the same centralized POS system.”
Despite a hard year, the future is full of opportunities for restaurateurs and retailers. For a full analysis of the top restaurant and retail trends of 2021, industry insights from Square experts, and real-life examples from innovative Square sellers, you can access the report here. For questions and additional data insights reach out to [email protected].