Tablets as the New Ordering Servers In The Near Future

Chili's And Applebee's To Install Tablets At Every Table: The Ordering of the Future

Ordering of the future: dessert by tablet. (Credit: Ziosk)

Get ready to order dessert at Chili’s on a tablet–just look out for your sticky fingers. Brinker, which owns and operates the Chili’s and Maggiano’s brands, will be installing tablets on each table in its 823 operated Chili’s restaurants by March 2014, though the company says its servers will play a critical role in its new wireless experience.

Those tablets, provided by Texas firm Ziosk, will allow customers to order drink refills and desserts as well as play interactive games in what is an overall “reimaging” of Chili’s restaurants’ design, says Krista Gibson, senior vice president of brand strategy at Brinker International.
What you can’t do, at least initially, is order appetizers and your main course. For that, you still need a server and a host or hostess to seat you at your table. “The way we are positioning this with servers is we have a team-service approach where each server is assigned to each section, and we are thinking of this as a third server,” Gibson says. “In no way are we looking at this as a replacement for servers.”

According to Ziosk chief executive Austen Mulinder, the tablet’s business model isn’t aimed at cutting labor costs. The Microsoft MSFT +0.33% veteran instead has helped build a tool that uses a freemium model for revenue based, surprisingly, on gaming.
Restaurants make more money when customers can order dessert and coffee and then get out of there faster, and the Ziosk allows customers to pay by credit card on the tablet. A green LED light then notifies the serving staff that a group has paid and can leave without fuss. In tests, Chili’s found that half of customers opted to pay through the device and even more during busy workweek lunch hours.

But the device is supposed to really make money when groups, especially families, pay $0.99 to play games like trivia on the device while they sit. The system pays for itself, Mulinder says, if enough guests, at least a tenth of customers, opt into such “premium” content.
Servers can see more tips as the system increases the spending on their shift, Gibson says. In six months of testing, Chili’s locations saw an increase in per-person spend per check, translating to higher revenue for both the restaurant and the wait staff. The company is also more likely to get guests to fill out surveys and thus sign up for future email marketing from Brinker.
What’s to keep people from breaking the tablets, or simply walking off with them? As you can see in the image above, Ziosk designed its tablets to only work within a restaurant’s walls and without utility for thieves who wiped the device clean. The five-year-old company’s only lost two devices across over 100 million transactions to date. Mulinder says the device is also designed to be spill proof and safe to accidentally knock onto the ground should things get rowdy at happy hour.
As for the potential moneymakers, the games, Ziosk connected to Android’s app stores and then curates game selections to have kid-friendly and group options, with nothing rated above an “E for everyone” rating.

The systems are only being installed in Brinker-operated Chili’s locations. Brinker approves technologies like Ziosk that can then be offered in separate deals to franchisees.
There are other payment systems out there like EMN8 , which works with fast-serve restaurants like Burger King, Carls Jr. and Taco Bell to enable mobile and kiosk-based systems. Ziosk bills itself as different because of its focus on engagement and revenue sharing model for its premium content.
The elephant in the room remains labor costs. Like many restaurant operators, labor accounts for the single biggest bump in corporate expenses, $890 million off fiscal 2013 revenues of about $2.8 billion, the bulk of that from Chili’s.

Even if Ziosk won’t admit it, the company’s system would work for all courses, not just desserts. Other Ziosk partners already use it for appetizer and drink ordering. Should a major partner demand to use it for main courses as well, allowing it to trim wait staff on the floor, it might not make sense for Ziosk to say no. And a system that allows servers to simply look for payment and bring orders as they flow into the main point-of-sale system, if run well, means that companies like Brinker would be deliberating increasing their cost to maintain a close server relationship with clientele (something Gibson says is a priority for Chili’s).

Ziosk and Brinker wouldn’t disclose details of the deal beyond the revenue sharing model, but Gibson calls the installation “a huge initiative for us in this fiscal year.” Mulinder says this is by far Ziosk’s biggest partnership to date but that the system works for small chains as well. Bars would be a natural extension for the system, if a bit messier.

The NEW generation: Struggling workers find new calling in direct sales

REPOSTED

Credits to: STEPHANIE CHAN

The Globe and Mail

INFORMATION AGE: One click and the product is shipped to your door.
Peace of mind and saves you time.

There was a time when the average Mary Kay or Avon seller was a housewife, but an increasingly competitive job market has launched a new wave of faces into the industry – Generation Y.

Concerned about an aging demographic of sellers in the ’90s, the industry has worked over the past decade to change the perception of direct selling to appeal to a younger generation. A new marketing strategy, in tandem with the tough job market, means that Generation Y, born between 1981 and 2000, is approaching the direct-selling model as a viable career option, rather than simply as a side business.

“That solidarity of having a stable job just doesn’t exist any more,” said April Tu, who left university early four years ago at 21 to pursue Amway, a direct-selling giant that markets everything from cosmetics to health supplements to cleaning products. “Students are investing thousands of dollars into school. … You’ve been told to do something that was supposed to work for you, but when you went out into the economy all you were met with was pure frustration.”

Young people such as Ms. Tu are increasingly seeing direct-selling as a way out of low-paying, entry-level positions after graduation, especially in an economy where youth unemployment hovers around 14 per cent, up from around 11 per cent in 2008. The number of long-term unemployed youth has also skyrocketed to over 40,000 as of October, 2013, more than triple what it was a half-decade ago.

But for Amway, Generation Y is its fastest rising demographic. Millennials have gone from representing

just over 10 per cent of its global sales force in 2005 to nearly a third in 2012. Gen Y now makes up a third of new Canadian memberships. Mr. Johnson also says that between 2011 and 2012, Amway has seen Gen Y shoot up 21 per cent in recruiting and 19 per cent in sales generated.

The demographic trend is also reflected at cosmetics giant Mary Kay Cosmetics Inc., where just over 20 per cent of the 38,000-strong Canadian sales force is Gen Y, while half of the U.S. sales force is under 35. The company, once synonymous with shopping parties, has taken great pains in the last decade to enhance its appeal, using online showrooms, virtual makeover applications and a widening social presence to attract a new generation. Sponsoring such events as the MuchMusic Video Awards has also created a new, younger Mary Kay culture.

Direct Selling Companies invests on you to lead and win.

“They have a very strong entrepreneurial spirit,” said Lynda Rose, vice-president of marketing at Mary Kay Canada. “They’re saying, ‘We want to travel with our business and we want to have it at our fingertips.’ … Their income is reflective of the amount of effort they put into their business, and they love that.”

Ms. Tu had only completed her first year of university when a stranger at a gas station approached her with the Amway opportunity. That stranger later became her first mentor after she quit school, and since then she has gone from new recruit to team leader of about 50 people, a team so dedicated that they clear about $20,000 worth of sales a month. Her weekly team and informational meeting in Waterloo, Ont., is attended almost exclusively by millennials, with another dozen from out of town who tune in to the live webcast – one logs on every week from Calgary.

Ms. Tu, 25, and her husband Jack net roughly $45,000 a year from their part-time business, made from a combination of sales and bonuses she receives from Amway for training her team. Membership has also seen a recent surge, with over a quarter of her team having joined in the last year alone, a product of an environment that Ms. Tu says appeals to her younger crowd.

“We recognize people for everything, whether it’s ‘I started a conversation’ to ‘I made a sale.’ We understand that in the normal world, people are not recognized for their achievements,” she said. “When you plug into an environment that is so blasted with positivity and hope and belief, it becomes something that you crave because it’s literally the best part of your week.”

The direct-selling opportunity is providing Gen Y with an alternative work environment outside of the nine-to-five, says 22-year-old Alex Bakay, who has spent roughly $1,000 on his business in the six months since he joined. He earns around $100 a month. The investment, he says, is more than worth it.

“Being told what to do all day isn’t the nicest thing,” he said, “so being able to hang around business owners all day who make their own schedule and who are disciplined – it brings a new mindset.”

Roberto Artwell, 19, who has also been with the team less than a year, is so optimistic about his business that, within the next 12 months, he sees himself with his own team of 50 people.

“The first time I walked into a meeting, I thought it was going to be a bunch of old people who’d already been successful and be the awkward one out,” he said. “The first time I came, I went, ‘Oh my gosh, half these people are around my age.’ … You know that if he’s 25, he’s 20, and I’m only 19, why can’t I do what he’s already doing? The reason why so many young people are jumping at this opportunity is because our infrastructure is so simple.”

Direct selling, or multilevel marketing companies (MLM), typically follow a basic model whereby sellers are recruited to market products, but also to recruit other sellers. Originating sellers earn extra percentages of pay based on the performance and size of their team.

Sad Reality for all those on Hard-working. You were
hired to build other people's dreams.

For years, the industry has faced harsh criticism for seemingly harbouring scams and pyramid schemes, which has led executives to drastically change marketing strategies. The shift is well timed: Gen Y remains relatively unaware of any stigma that surrounds MLMs. An Ipsos study commissioned by Amway found that 79 per cent of millennials in North America were favourable or neutral to the direct-selling model.

Nowadays, “we present it in a much more common-sense, basic presentation,” said Jeff Johnson, national sales manager for Amway Canada. “What’s in it for them. What can they earn. … They want to know the bottom line, and they don’t want a PhD thesis given to them.”

Mary Kay does not post earnings, though Amway parent Alticor Inc. has reported consecutive years of growth, having hit $11.3-billion (U.S.) worth of sales in 2012. The performance of other publicly listed MLMs also shows a slowly expanding industry. Both Herbalife Ltd. and Tupperware Brands Corp. announced record third-quarter earnings in October. Avon Products Inc. saw another dip in earnings, but the company is struggling with more than just sales, having changed leadership last year.

For many in Generation Y, the industry’s accomplishments suggest a future where the young can achieve entrepreneurial success, with or without a degree.

“They want financial independence,” Ms. Rose said. “… They almost see work and fun time as mixed. Maybe my generation you have work and home. Our lives were separate. But a Gen Y person looks at their life and goes, ‘My work has to be fun, my life has to be fun and I want to do a job that’s fun.’ ”