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The POS Industry: A Three-Part Rant

The phone I grew up with was clunky and served just one purpose — talk to someone. My monthly costs were high, and long distance calls were expensive. If something broke… major trouble. Today I have an iPhone. I can do a million tasks on it easily and intuitively; apps make it infinitely customizable; and while I may pay more each month, the expense is pegged to my usage- to my satisfaction.

The POS is a nerve center of a restaurant but no matter how much improvement you drive everywhere else in your operations, the majority of POSes are at best like the old phone.  There are three big issues that need to change to bridge the divide between today’s POS and the POS of our dreams. 

1. Elegant, attractive design, once consider frivolous, is now known to improve user satisfaction and return on investment. System complexity leads to errors and long training times. And those fancy features you paid extra for? No one uses them because no one remembers how. There is a new generation of App-based POS with great user interfaces (notably Lavu, Breadcrumb, and OwnPOS), but the vast majority of restaurants still use outdated systems…and pay dearly for it. 

2. My new phone is not just pretty. It is open. Third party developers have access, building apps that provide specialized service. I use Instagram for photos and Dropbox for file sharing. Not only does this free Apple to focus on their core capabilities but I am more - not less - dependent on the phone. POSes today offer a tiny selection of third party apps (like one or two choices for online ordering) but otherwise force you to rely on their usually inferior native tools or use third party apps without POS integration. Close your eyes and imagine  a world with an easily installed MailChimp and Fishbowl email apps linked in real time to your POS. Now open your eyes. Reality stinks.

3. Perhaps worst of all, most POS companies use a sales + service financial model. You pay up front, then again for maintenance and service, and if you need something special or have a problem you pay even more. Sometimes much more. Last year, 68% of Micro’s revenue came from service. My phone, on the other hand, charges me for use: The more I use it the higher my data bill. Shopkeep, one of the better App-style POSes, has a light-weight pricing model. Not the same as pay-for-use but at least strong value.  If restaurants had a choice of POS apps I bet usage, satisfaction and ROI would go up. Would you rather pay for success or failure?

The restaurant industry is waking up to the idea that the old model serves the POS industry but not consumers or restaurants. And when a new generation of operators looks at the phone in their pocket and the POS terminal on their host stand, they are going to demand change. Easy, open, financially aligned. This is not too much to ask for. Why do most POS companies serve pink slime and call it sirloin? Demand better.

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Your Point of Sale is Heading Out the Door and on to the Web

The big number from the National Restaurant Association’s infographic on restaurant tech is this: 36% of diners have ordered food online. Which means no matter how pretty a restaurant’s Facebook page or active their Twitter account, it won’t matter — not if they’re not integrating online ordering into their services. Their potential customer’s purchase has already been made. And restaurants without online ordering weren’t even in the running for their dollars.

People in sales know their ABCs: Always Be Closing. Don’t let the prospect think too long about the purchase, never let them walk away. But with the fast growing power of tech to interrupt your conversation with a customer, not to mention all the other restaurants on your street, the only sure way to own that customer is to get their order before someone else does.

When a customer sees your menu or reads a great review you are not done — you need to close. Get that order RIGHT then. You need to close…or someone else will.

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Restaurants Pick Up the Social Media Gauntlet — But There’s Much More on the Way

It’s becoming increasingly clear that restaurants need to push their marketing further out from their restaurant to capture and retain customers. According to a nifty infographic from the National Restaurant Association, 28% of customers use social media to choose a restaurant; 27% use consumer-driven review sites.

Frankly these numbers seem low, and are low I am sure when you look at younger demographics- the customers who could be with you for the long haul. But even these suspiciously low numbers paint a powerful picture.

This means the decision-making process is happening long before customers walk into your restaurant for dinner.  They did it before they left their office or while surfing their phone. They did it while chatting or texting with their dinner companions while checking restaurant listings and reviews.

Restaurants are not blind to what this means — 9 in 10 restaurant operators say social media will become more important and 95% expect to be on Facebook within two years (if they are not already).

But the percent of diners who are driven by social media and consumer reviews is not the most important data point for restaurant operators. There’s a new digital landscape for restaurants to take advantage of emerging, just as they begin to master social media.

Any guesses? We’ll be posting part two with the answer later today.