Not all takeout-ordering apps are the same.
By Michael E. Duffy
At the close of last month’s column, that was the question I raised, and now I’ll try to supply an answer. Of course, you already know that it won’t be a simple yes or no. Questions like this can only be answered with “it depends.” This month’s column will tell you what it depends on, so you can decide for yourself.
Let’s take a real-life example: local pizza chain Mary’s Pizza Shack with 10 locations vs. Papa Murphy’s Pizza with over 1,300 locations nationwide. You can certainly call a nearby outpost of either chain and place your order over the phone. On the other hand, if you don’t want to deal with the possibility of being put on hold, shouting over the background noise, or the possibility that the person on the other end of the phone gets your order wrong, you can order online.
In the case of Mary’s, you have one option: going to its website (maryspizzashack.com) in a browser, either on your phone or on your computer. In the case of Papa Murphy’s, you can choose between its website, or its mobile app for either Android or iOS. That difference illustrates one of the basic choices for a business considering an app: how does the cost of developing the application compare to the potential increase in revenue that an app might generate? In the case of a business that has hundreds of locations, that cost is more easily amortized.
As I mentioned in my last column, Steve Jobs originally hated the idea of third-party apps for the iPhone, expecting instead that developers would simply create websites that understood the particulars of a mobile browser like Safari or Chrome. A mobile-aware website can provide an excellent experience for users, and it leverages a company’s existing investment in a website and its attendant infrastructure. And in the days before app stores (the Apple App Store and Google Play), that was all that was available.
If you look closely when you order from Mary’s website, you’ll notice that once you select a location to order from, the URL changes to something like marys-location.hrpos.heartland.us. Technology is expensive to develop and maintain in-house. Mary’s relies on the offerings of Heartland Payment Systems (heartland.us), “the complete technology solution for growing small businesses.” Heartland provides white-label technology that can be customized for a particular restaurant. As long as your requirements are pretty similar to other businesses in your industry, it can make sense to use a white-label solution. Heartland could even offer a mobile app to its customers, although it appears that they believe a mobile-aware website is sufficient. And they are probably right for the businesses they serve.
I order pizza online from both Mary’s and Papa Murphy’s. I will tell you that Papa Murphy’s is much more active in trying to get me to place my next order. Both companies have my email address, but it’s virtually guaranteed that I will get at least one email a week from Papa Murphy’s. When I place an order, there is generally some incentive (free Cheesy Bread, a $5 value!) for me to place another one soon. Mary’s is much more demure.
Mary’s chose Heartland to provide online ordering. Heartland is a payments company. Papa Murphy chose a company called Relevant Mobile, whose focus is much more on loyalty and rewards. Like Heartland, Relevant is a white-label app. But the underlying focus of each provider definitely shows through in how Mary’s and Murphy’s approach their customers, via web, mobile, and email.
The basic question is pretty simple – will an app generate more income than it costs, presumably by making it more convenient, enjoyable, or worthwhile to customers? You can defray the cost of providing an app to your customers by using a white-label, as both these companies have done. As with most businesses, ownership’s stance on the value of new technology is a key factor, which in turn hinges on their attitudes about risk taking.
But just “having an app” is unlikely to generate big results. You need to have a strong answer to the question: “Why should I download your app?” Most people want some incentive to do so. If a company wants me to use its app, it had better provide something I can’t get just by going to its website using the browser on my phone..
Apps are about convenience. You can’t develop an app without asking actual customers what would make their experience more convenient. And you shouldn’t consider developing an app unless you have a plan to use the information about customer habits that an app can deliver to encourage your customers to interact (and hopefully spend) more frequently.
Mary’s has a website to make it easy to order a pizza. Murphy’s has a system to encourage its customers to buy more pizza, whether they use the app or the website, and I think that’s the stronger approach.
Michael E. Duffy is a senior software engineer for Atlanta-based mobile gaming company Global Worldwide (global-worldwide.com), who lives in Sonoma County. He has been writing about technology and business for NorthBay biz since 2001.
