COSTA COFFEE TRIALS DELIVERY, LOYALTY PROGRAM FOR A FASTER FIX

MARCH 2019

COSTA COFFEE TRIALS DELIVERY, LOYALT Y PROGR AM FOR

A FASTER FIX

Costa Coffee's Arslan Sharif on mobile

6 order-ahead for customer loyalty Page 6 (Feature Story) Uber Eats cuts fees

11 to compete with third-party apps Page 11 (News and Trends) QSRs face mobile

17 order integration challenges Page 17 (Deep Dive)

22The latest mobile order-ahead provider rankings Page 22 (Scorecard)

MOBILEORDER-AHEAD TrackerTM

Table Of Contents

3 6 11 17 19

What's Inside

An overview of recent mobile order-ahead headlines, from Uber Eats' competition with Deliveroo and Chipotle's expanded service to QSR players pushing forward with their mobile ordering strategies

Feature Story

An interview with Arslan Sharif, global digital and loyalty director for Costa Coffee, on the company's mobile order-ahead and delivery approaches in London

News and Trends

The latest industry news, including that mobile orders now comprise the bulk of those made digitally and how brands are working to remain top-of-mind in an increasingly competitive space

Deep Dive

Mobile everything is becoming more important, meaning QSRs and smaller restaurants must rise to the challenge to make sure their mobile order-ahead experiences are as frictionless and easy as possible

Scoring Methodology

Who's on top and how they got there

21

Top Ten Providers and Scorecard

The results are in. See the top scorers and a provider directory featuring 77 players in the space

52

About

Information on PYMNTS and Kount

Acknowledgment

The Mobile Order-Ahead TrackerTM is done in collaboration with Kount, and PYMNTS is grateful for the company's support and insight. retains full editorial control over the findings presented, as well as the methodology and data analysis.

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WHAT'S INSIDE

Mobile represents approximately 60 percent of all digitally placed restaurant orders today, meaning smartphones are clearly at the center of ordering and delivery. Consumers now have a variety of quick-service restaurant (QSR)- and third-party-branded apps from which to choose when it's time to order meals or midmorning coffees -- but that also means the race to see which apps customers will choose is getting only more competitive.

Most popular restaurants and QSRs already offer mobile order-ahead, and many are pulling out the stops to keep customers loyal. Domino's Pizza is running a promotion that gives app users free pizza even if they eat at competing brands, for example, while burrito- and bowl-focused Chipotle is expanding its mobile-order and pickup features.

Other companies are turning to partnerships with aggregated services like Grubhub and Deliveroo for home delivery. Even these apps are facing competition, however, with Uber Eats slashing prices and fees to keep customers and

restaurants on its platform. It seems the mobile ordering space is getting bigger, faster and more challenging for new entrants and existing participants alike.

Around the mobile order-ahead world

Third-party apps are adding new restaurants and markets to stop customers from switching to separate services. Aside from Deliveroo, Uber Eats is also fending off Just Eat and DoorDash, with the latter recently surpassing it in the U.S. for online food delivery.

Even restaurant brands and QSRs are beginning to launch menu items and options via partnerships with these increasingly ubiquitous platforms. Fast food favorite Taco Bell has added delivery throughout the U.S. in partnership with Grubhub, complete with a promotion for free services for opportunistic consumers searching for the next cheap thing. Such promotions may be more worthwhile than one might think, too. Burger King, for example, reported 1.5 million app downloads after offering its signature Whopper sandwich for 1 cent to users near McDonald's locations.

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What's Inside

For more on what's new in the mobile order-ahead world, visit the Tracker's News & Trends section (p. 11).

Costa Coffee trials delivery, loyalty program for a faster fix

One of the areas seeing more mobile order-ahead play is coffee, with consumers buzzing to get their daily fixes as quickly and easily as possible. As such, U.K.based Costa Coffee has added new capabilities to its mobile app to entice customers to its loyalty programs and away from competing coffee clutches.

User experience (UX) app design and features must be carefully considered to ensure that mobile order-ahead maintains the necessary convenience, however. In a recent interview with PYMNTS for the March feature story (p. 6), Arslan Sharif, global digital and loyalty director for Costa Coffee, explains how the brand is approaching mobile, home delivery and customer relationships in a world where satisfaction relies on speed.

QSRs face mobile order-ahead infrastructure challenges

QSRs need mobile order-ahead to stay competitive, but integrating such necessary capabilities into the restaurant experience isn't easy -- or cheap. Mobile ordering is expected to grow to $38 billion by 2020, and QSRs must face the challenges associated with personalizing services and offering seamless payments if they want to provide the app or brand customers choose. This month's Deep Dive (p. 17) explores how these firms are approaching such worldwide mobile order-ahead challenges.

EXECUTIVE INSIGHT

How can QSRs protect against fraud while still keeping the user experience seamless for their customers?

"Fraud prevention and customer experience must be top-of-mind for QSRs as they continue their digital transformation from brick-and-mortar retail to mobile order, mobile wallets, digital loyalty programs and other digital innovations. With these new channels to engage consumers, QSRs must be aware of the potential for fraud at any point along the customer journey.

When thinking of customer experience, most designers tend to consider the path a legitimate consumer would walk. Fraudsters and criminals don't do this -- they are looking for any potential path to exploit, which could occur at any point along the interaction.

Yet, blocking fraudsters should not also be hampering legitimate customers. A seamless customer experience is essential for building loyalty, so roadblocks to stop fraud must be strategic. QSRs are best served to partner with a knowledgeable and experienced fraud prevention provider. [For example,] Kount is invisible to customers and delivers intelligence to businesses within 250 milliseconds. Using advanced machine learning, Kount delivers a `Boost Safety Rating' to businesses to help them identify good customers. Combined with a flexible policy engine and 12-plus years of Kount's universal identity network, digital commerce companies can better protect against fraud while delivering a frictionless customer experience."

RICH STUPPY chief customer experience officer at Kount

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What's Inside

Five Fast Facts

16.4M

Number of U.S. customers actively ordering food and drinks on Grubhub

13%

Portion of all Starbucks orders that came through the company's mobile ordering tool in 2018

44.5%

Portion of QSR consumers who still prefer to place orders with employees in restaurants

71%

Share of drivers who believe adding food-ordering capabilities to their cars would be useful

10%

Share by which mobile order-ahead customers' food volume tops that of non-mobile

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