Shake Shack Pilots In-Store Tablet Ordering

by Raymond Pucci 0

Can tablets smile and say Thank You? New York City customers at a new Shake Shack will soon find out. As the following article reports, Shake Shack is the latest Quick Service Restaurant (QSR) to use tablets for ordering meals as opposed to counter people.

Shake Shack is going the “Eatsa” route.

Danny Meyer’s burger chain is opting for touch-screen kiosks at its newest location in Manhattan’s East Village, as opposed to hiring human cashiers. cleverly pointed out that the move marks an “about-face” for the renowned restaurateur.

“I know there is a temptation to replace human beings with robots or with iPads,” Meyer said last year. “We want you to leave there just skipping with delight, and so far we haven’t found anything that does that better, either in terms of the food or the hospitality, than people.”

Today’s a different scenario. The new Shake Shack (NYSE: SHAK) location, slated to open in the IBM Watson building (51 Astor Place), will be akin to Eatsa, the San Francisco-based lunch spot run by tablets. Shake Shack diners will be able to order their sandwiches, fries and shakes through touch-screen kiosks that do not accept cash — only credit or debit cards.

A human will stand by for assistance, while text messages will alert customers when the food is ready. CEO Randy Garutti referred to the new Manhattan location as “a playground” to “test and learn the ever-shifting needs” of its guests.

The decision coincides with a trend where both fast-casual chains and fast-food venues alike have been embracing a new kind of automated restaurant with lower labor costs because they require fewer staff — even though their marketing materials say there will be a lot of hiring done.

Previous company statements aside, it’s not surprising that Shake Shack is joining some other QSRs such as McDonalds and Subway by giving tablet ordering a try. Labor and overhead expenses weigh heavily on retail food operations, especially in high-cost, big city venues. But tablets cannot upsell or engage a customer as a human employee can. Which is why some QSRs are finding mobile order and pay ahead apps a very promising new sales channel—and one that deserves more implementation.

Overview by Raymond Pucci, Associate Director, Research Service at Mercator Advisory Group

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