Dive Brief:

• The COVID-19 pandemic has accelerated early tech adoption among foodservice operators, according to a report from Panasonic, which surveyed 150 food services and food retailer decision makers. One in four foodservice retailers now believe their company is a tech-forward early adopter, versus one in eight pre-pandemic.
• All survey respondents said the pandemic has increased their sense of urgency to adopt transformational technologies, and 71% said digital transformation is very important, more than any other factor, for business agility.
• In response, these businesses are adopting technologies that prioritize safety, self-service and preferred delivery methods to fit new consumer behaviors. Respondents believe those behaviors will stick around for at least the next 12 months.

Dive Insight:

Panasonic's study shows that 78% of respondents believe contactless payments are in high demand, which has resulted in the adoption of solutions like food lockers for pickup orders, facial recognition kiosks and vehicle/license plate recognition. According to Global Market Insights, the contactless payment market is set to grow from its current market value of about $40 billion to over $100 billion by 2026, driven by the pandemic.

A number of chains have introduced redesigned restaurants with many of these features at the forefront. Taco Bell's Go Mobile location, set to debut in early 2021, will include in-store shelves for pickups, while El Pollo Loco's new models will have cubbies for to-go orders and GPS-enabled curbside pickup service. KFC will look at different ways to add order-and-pay-ahead functionality to its Next Generation Prototype, while customers using Burger King's modernized drive-thrus will be able to choose contactless payment through its partnership with Verifone. 

With emerging technologies like facial recognition or GPS-enabled curbside service comes the debate over privacy concerns and opt-in agreements will become a critical piece of the puzzle for operators. Such opt-in agreements won't likely compromise the investment in such technology, however — more than half of Panasonic's respondents said consumers are willing to provide more personal data through personally-identifiable recognition technologies.  

Within the next two years, a bulk of operators said they are likely to adopt business models like in-house delivery, drive-thru-only stores and self-service-only stores. Forty-four percent of respondents said it's "very likely" they'll adopt an in-house delivery service in the next two years — an effort to better control costs without paying a third-party delivery's high commission prices. Many operators are also likely to adopt self-service stores (55%), drive-thru-only stores (45%), or dedicated pickup solutions (45%).

Restaurants have had to shift their business models to make up for the loss of heavily restricted dine-in traffic. An October study from TD Bank found that 72% of franchisees have implemented enhanced delivery services/online and mobile ordering since the pandemic started.