Profiting from the Embarrassment Bump

Offering online ordering on your restaurant’s website can boost sales.

Have you ever been ordering food on the phone and stopped yourself from upsizing more to your order? Perhaps, like Key and Peele, you pretended to be hosting a party to justify ordering that large pizza? Well it turns out, you aren’t alone.

New research out of the U.S. has found that the embarrassment of ordering over the phone is real problem for restaurants: And that offering online ordering on your restaurant’s website may be the perfect antidote.

Avi Goldfarb, Ryan McDevitt, Sampsa Samila, and Brian Silverman from the Duke Fuqua School of Business found that restaurants saw big profit jumps after implementing online ordering.

Why did that happen?

The lead factor the study narrowed in on was embarrassment—or rather the lack thereof in online ordering. It turns out, when you remove the fear of embarrassment (for example in ordering extra food or toppings), customers are more likely to order more food.

That might seem like a commonsense observation, but the striking thing is just how much more food customers ordered online as opposed to over the phone: 21.4 percent to be exact. It turns out that online ordering comes with quite an embarrassment bump.

There is of course one hitch (there always is). Much of the gains revolved around complex orders—specifically the addition of toppings and special ingredients. Overall, online orders were 15 percent more complex than phone orders, resulting in customers spending $0.61 more per order.

Online ordering

That means any restaurant online ordering system that can’t make those kinds of customizations easily, will lose out on the embarrassment bump.

The trouble is, many marketplaces like JustEat and GrubHub, make it difficult to adequately capture the myriad of options your restaurant has to offer. If I want my pizza with bbq sauce and mayonnaise and JustEat can’t offer me that option embarrassment-free, I just might skip it altogether.

FOODit customers have found similar trends to be true of online ordering on their own restaurant websites.

One restaurant, Mamma Mia, has seen a noticeable bump in the mix of sauces customers are requesting with their kebabs when they order from the restaurant website. Whereas previously on phone orders, customers only asked for one sauce on average, when given the choice of six online, they are now choosing to mix and match. Because it’s resulting in higher-than-normal sales, Mamma Mia is more than happy to oblige, even if it adds some stress to their EPOS!

In fact, what we’ve seen with FOODit’s launch customers closely mirrors the findings of these researchers. Implementing an online ordering system results in sales boosts over phone ordering every time. Each time you make a customer pick up the phone to order, as opposed to letting them order online, you reduce the chances that they’ll order at all.

The implications on restaurant marketing are obvious. Offering online ordering is no longer a “nice thing to do”. It’s now a vital part of savvy marketing and should be central to any restaurant business plan—whether it’s a simple burger ordering system or a complex pizza ordering system with all the fixings. Additionally, customers don’t have the time or patience for online ordering systems that won’t let them customize their food exactly as they want (even if that means mixing mayonnaise and bbq sauce!)

The bar for online ordering has been raised.