Free pizza and burger specials
Some restaurants are trying to get customers to order directly from them by offering special deals.One example: If you order two pizza pies from one of Motorino’s three NYC locations by phone, you get a third pie for free. Motorino advertised the special online and on its pizza boxes.Customers who dine in at 5 Napkin Burger, also in New York City, receive a postcard with their check that implores them to order directly “from any restaurant that offers this option,” because “doing so allows more of the money from your purchase to stay with the restaurant.” Customers who eat at the restaurant or order directly can get a special burger of the day, and the burger chain has waived delivery fees on some orders for customers who use their website, rather than a third-party provider.But customers still have to find their way to your website to place the order, which could be a significant hurdle, noted 5 Napkin Burger CEO Robert Guarino. The restaurant offers delivery through its own site, but 5 Napkin Burger is also on Grubhub.”Very few folks have cut the cord,” Guarino said. “There may be a day where that comes, especially in urban locations.”
DIY Delivery
Some restaurant operators who weren’t interested in delivery before the pandemic dove in once they had to close their doors.Kentucky-based chef and restaurant operator Ouita Michel is one example. In the spring, she scrambled to set up her own ad-hoc delivery service.”We converted our waitstaff into delivery drivers, probably against every advice of our insurance,” she said. The economics of third-party delivery platforms never made sense for Michel’s farm-to-table spots, where ingredients are expensive and margins even lower than for fast food or other restaurants. Plus, she didn’t want to lose control of how her food was presented to customers. Michel’s servers stopped making deliveries when her dining rooms reopened, but she isn’t using any mainstream delivery providers.Instead, a few of Michel’s restaurants are participating in the pilot program for a new app called Delivery Co-Op, which uses a cooperative model. Delivery Co-Op promises restaurants more control over the delivery process by charging a monthly membership fee, rather than a per-order commission. The group collects membership fees from customers, as well, and hires drivers with those funds. Those drivers are embedded in individual restaurants so they can become more familiar with their menus and processes. There are about 25 restaurants on the group’s waitlist.Restaurants that try to avoid major delivery platforms by banding together don’t have much of a chance, warned Cowen restaurant analyst Andrew Charles.”The restaurant industry isn’t set up for co-opetition,” he explained, because it’s so competitive.But competition may also squeeze the delivery business itself, noted Melissa Wilson, principal at the market research firm Technomic.”Before the pandemic consumers were very much willing to pay the high delivery fees and service fees for convenience,” said Wilson. But now, with more ways to get food to-go, customers may be more price sensitive.”Curb-side service has been a game changer,” she said. “There’s definitely more of an opportunity now for restaurants to persuade consumers to consider either drive-thru, the restaurant’s own delivery service, or curbside, versus going through a third-party provider,” she said.For Motorino’s Palombino, the onus falls in part on customers.”I really wish that people would choose to call their local pizza joint,” he said. “It makes such a huge difference.”