The Rise of Third-Party Platforms
Third-party delivery platforms have undoubtedly revolutionized the restaurant industry. They offer a one-stop solution for consumers, allowing them to browse through various cuisines, compare prices, and place orders seamlessly from their smartphones or computers. These platforms promise restaurants increased visibility, access to a broader customer base, and the convenience of outsourcing delivery logistics.
For many restaurants, partnering with third-party platforms initially seems like a lucrative opportunity. It offers a quick solution to enter the online delivery market without the hassle of developing a proprietary ordering system. However, as the relationship progresses, several drawbacks of relying solely on third-party platforms begin to surface.
The Pitfalls of Third-Party Ordering
High Commission Fees
One of the most significant drawbacks of third-party platforms is the hefty commission fees they charge. These fees can range from 15% to 30% per order, significantly eating into the restaurant’s profit margins.
Loss of Control
By depending on third-party platforms, restaurants relinquish control over crucial aspects of their business, such as customer data, branding, and the delivery experience. This loss of control can undermine the restaurant’s ability to build a loyal customer base and differentiate itself from competitors.
Brand Dilution
When customers order through third-party platforms, they often interact more with the platform’s interface than the restaurant’s brand. This can dilute the restaurant’s identity and diminish its ability to establish a strong brand presence in the digital space, creating a loyalty to the platform and not the restaurant itself.
Limited Customization
Third-party platforms impose restrictions on menu customization and pricing, limiting restaurants’ flexibility in offering promotions, discounts, and special deals tailored to their target audience.
Dependency Risks
Relying solely on third-party platforms exposes restaurants to the risk of sudden policy changes, algorithm updates, or technical glitches that could disrupt their online presence and revenue streams overnight.
Embracing First-Party Ordering
In contrast to third-party platforms, a first-party ordering system allows restaurants to take full control of their online ordering process. Partnering with a company that specializes in first-party ordering will take some of the burden of the setup of this digital space and use their technical and industry experience to guide you to success with your ordering software.
Learn how Rally Eats can help you solve your digital ordering pain points.
Benefits of First-Party Ordering System
Lower Costs
By eliminating third-party commission fees, restaurants can significantly increase their profit margins. The money saved from commission fees can be reinvested into marketing efforts, menu enhancements, or improving the overall dining experience. Partnering with App8 means you no longer have to worry about paying commission fees on your digital orders that come in through your website, digital app or online menu link.
Enhanced Branding
With a first-party ordering system, restaurants can showcase their brand identity prominently throughout the ordering process. From the website design to the packaging of the delivered food, every interaction reinforces the restaurant’s unique brand image and values.
Access to Customer Data
Unlike third-party platforms that withhold customer data, a first-party ordering system allows restaurants to collect valuable insights into their customers’ preferences, ordering habits, and demographics. This data can be leveraged to personalize marketing campaigns, improve menu offerings, and foster stronger customer relationships.
Greater Flexibility
With full control over menu customization, pricing strategies, and promotional offers, restaurants can adapt quickly to changing market trends and consumer preferences. They can experiment with different promotions, bundle deals, and loyalty programs to incentivize repeat orders and drive customer loyalty.
Improved Customer Experience
By owning the ordering process from start to finish, restaurants can ensure a seamless and personalized customer experience. From intuitive navigation and easy payment options to accurate order tracking and timely delivery, every aspect of the ordering journey is optimized to delight customers and exceed their expectations.
Long-Term Sustainability
Investing in a first-party ordering system is an investment in the long-term sustainability and growth of the restaurant business. By building direct relationships with customers and reducing reliance on third-party intermediaries, restaurants can future-proof their online ordering strategy and maintain a competitive edge in the ever-evolving digital landscape.
Conclusion
While third-party delivery platforms offer convenience and reach, they come with significant drawbacks that can hinder the long-term success of restaurants. By embracing a first-party ordering system, restaurants can reclaim control over their online presence, drive profitability, and deliver an unparalleled customer experience. In an era where digital engagement is paramount, investing in a first-party ordering system isn’t just a competitive advantage – it’s a strategic imperative for restaurants looking to thrive in the digital age.
