Invented by a Japanese engineer in 1994 to more easily track auto parts, quick response codes entered the mainstream years later when smartphones with cameras took over. But it wasn’t until the ongoing pandemic forced companies to redouble their efforts to disinfect that they became a ubiquitous spectacle in American bars and restaurants, replacing physical menus.
Bitly, a link management service, said it has seen a 750% increase in QR code downloads over the past 18 months. Bitly President Raleigh Harbor said restaurants have realized how valuable technology is, beyond facilitating contactless service.
“They are able to adjust their menu offerings on the fly to account for things like inflation, food and commodity price fluctuations and other variables,” Harbor said.
Prices for out-of-home food rose 0.8% in July, climbing 4.6% in the past 12 months, according to the Bureau of Labor Statistics. The prices of commodities like coffee and pork have skyrocketed this year. Restaurants have also raised prices after raising wages to attract workers.
Shortages are another area of concern for restaurateurs. Chicken wings, hamburger patties and tequila are among the items operators have struggled to source due to supply chain issues linked to the pandemic.
A QR code also gives restaurants more information about their customers. Reservation services like OpenTable, SevenRooms, and Resy pass data on who made the reservation to restaurants – but not everyone at the table.
“If you run a restaurant that doesn’t take reservations, you don’t know who your guest is until they pay,” said Bo Peabody, co-founder and executive chairman of Seated, a reservation service at restaurants that rewards diners for visiting certain restaurants. “What the QR code might allow you to do is learn who this guest is right when they are seated. “
Peabody also owns Restaurant Mezze in Massachusetts, sits on the Boqueria Restaurant Group Board of Directors and is a venture capital partner at Greycroft, where he invests with a focus on restaurant technology. Mezze and all the restaurants in La Boqueria used QR codes in place of menus during the pandemic, according to Peabody.
Catering technology experts see even more opportunities in QR codes beyond physical menus. The pandemic has ushered in a boom in online restaurant orders, and industry experts predict the change will persist as well. The move to QR codes makes it possible to order online on site, instead of being linked only to delivery and take-out transactions.
Noah Glass, CEO of digital ordering platform Olo, told analysts during the company’s earnings call that on-premises digital transactions accounted for 1% of overall industry transactions for the first time. The change can be attributed to both QR codes and the rise of auto-order kiosks.
“This is a big step in an industry that makes 60 billion transactions in a typical year to see 1% go digital on-premises,” Glass said.
Through Olo or Toast point-of-sale service, for example, a QR code can direct customers to a link to order and pay on their phone, even at full-service restaurants.
“This enables restaurants with fewer staff to operate more efficiently – something our customers find critical to their operations as restaurants across the country face staff shortages,” said Chris Comparato, CEO of Toast.
Peabody suggested that QR codes could allow restaurants to track past customer orders, making it easy for diners to order the next time they visit, like the features used by third-party ordering platforms like Grubhub and Doordash.
“Bringing it all into the restaurant is the promise of the digital connection with the customer, which of course starts with the QR code,” Peabody said.
Seated started offering additional rewards to its users when they scanned the QR code and filled out the contact tracing form. These rewards can be applied to gift cards or credits from providers like Uber or Starbucks.
“Even when contract tracing goes away, just receiving something of interest can tempt you and feel comfortable with using a QR code menu,” Peabody said.
Restaurants can also implement QR code payments on receipts, so customers can pay without taking out a credit card or cash, Comparato said. It’s both more convenient for customers and faster for waiters, allowing restaurants to seat more customers by turning tables more quickly.
However, QR codes are not the solution for all restaurants. Some have reverted to physical menus as easily as they removed plexiglass barriers between tables when states began to drop restrictions in late spring and early summer this year. Darren Seifer, food and beverage analyst for The NPD Group, said fine-dining restaurants are less willing to replace their menus or ordering process with QR codes.
“I see some hesitation with some of the better restaurants because it’s not as fancy as getting the check at the end of the meal,” Seifer said.
Dine Brands, the parent company of IHOP and Applebee’s, plans to offer both options to customers.
“People have different levels of digital convenience,” said CEO John Peyton. “Some people will prefer and enjoy the QR code and the use of the phone, and others will have the traditional menu instead. “