Next year Applebee’s will have a big item on its plate: the largest tablet rollout in the country. The company, a subsidiary of DineEquity Inc. of Glendale, announced this month its more than 2,000 locations will each have tablet computers, making it the largest dining chain yet to experiment with the technology. The decision will put about 100,000 Presto tablets on the table. Other restaurateurs have tried out tablets, and experts say they can lead to bigger food orders and more efficient operations. But Applebee’s hopes it will increase the fun and speed of the dining experience, while possibly generating bigger checks. “The vision is to develop an on-going two-way dialogue to personalize and customize guest experience in real-time,” said Dan Smith, spokesman for Applebee’s. “In the short-term, guests will be able to order from the tablet, pay by swiping the credit card and play a selection of games.” Other restaurant companies that have implemented tablet programs include Buffalo Wild Wings Inc. of Minneapolis and Brinker International of Dallas, which operates the popular Chili’s restaurant chain. But neither matches Applebee’s size. Applebee’s began testing the tablets nearly two years ago, mostly at its corporate-owned restaurants, some of which are near its headquarters in the Kansas City, Mo., area. The casual dining chain partnered with E la Carte Inc. of Redwood City to deliver its Presto tablets backed by Intel Corp. technology after initially approaching E la Carte in 2010. Rajat Suri, founder of E la Carte, said besides the company’s technology, Applebee’s also liked the different options the tablet could provide. “Right now it’s going to have basic functionality,” he said. “Video streaming will come later – a lot more content in the future, such as mobile phone interaction and mobile wallet later on in phases.” Virtual helpers When diners visit an Applebee’s in the future, they will be greeted by a host and escorted to their seat as at present. Each table will have a waiter or waitress, and traditional diners can still read the menu and order the old-fashioned way. But those in a hurry or who want to alter the recipes on the menu will have the electronic option. Each table and bar will have a seven-inch tablet solidly anchored in an accessible position. Diners can look at the menu items and order on the touch screen. While waiting for the food, the diners or their children can play games which cost 99 cents. Options include a selection of coloring games, trivia, memory games and more. Eventually, it’s possible the tablets will have video or even advertising on screen. The wait staff will still deliver the food and drink, but when the meal has concluded, the diners can swipe their credit card on the tablet and leave without any wait. Suri said the tablets are safe and will not store any credit card information. He added that since tablets are secured through the restaurant’s Wi-Fi network, they are virtually useless if taken out of the restaurant. He added customers cannot browse the Internet on the tablet during their dining experience. Jerry Prendergast, founder of restaurant consultancy Prendergast & Associates in Culver City, said a restaurant’s costs associated with wireless tablets are usually much lower than installing a new terminal, such as a computerized cash register, for use by wait staff. “If they buy a new terminal, it’s from $2,000, compared to an iPad, (we’re) talking in the neighborhood of $299 per unit – one sixth the cost per unit compared to a hard-wired terminal,” Prendergast said. E la Carte declined to disclose how much each of their tablets cost. Although Applebee’s also declined to comment on the financial cost of this investment, Smith said serving staff will not be eliminated due to the tablets. Instead, he said servers see tablets as virtual helpers. “Neither we as franchisors or the franchisees plan to reduce staff. In fact, in test markets team members see Presto devices as an assistant that allows them to focus on the more value-specific part of their job,” Smith said. Peter Saleh, an equity analyst for New York-based Telsey Advisiory Group, said the customization of menu orders is something the kitchen staff, not the serving staff, will have to take into account. “The biggest challenge is not overwhelming the kitchen staff,” he said. “It’s an operational challenge, but I’m sure they can figure that part out.” Besides pleasing its customers, Applebee’s might also see an uptick in revenue from the new technology. Analyst Saleh said audiences that use tablets at restaurants have higher checks. “What we’ve heard from these tablets coming into the restaurant, the average check tends to go up because clients purchase more drinks,” he said. “Computers are better at upselling than servers.” Prendergast has consulted with restaurants that installed tablets, and they found the main advantages were operational. The servers can cover more tables and have a quicker response time when customers need attention. “The only downside is if Internet went out,” he said. Financially, while the check amount may go up, Prendergast cautioned Applebee’s still has to take into consideration logistical costs for adding the tablets. “They have to do training – management training. Managers need training on the codes, rollover employee manuals and how to switch over credit card information,” he said. “It’s not like you walk in and switch the tablets in and out.” The technology update is a trend that other restaurant chains have tried. Last year, Buffalo Wild Wings tested tablets at 45 of its 1,000 locations. And in September, Chili’s announced it would put tablets at each of its 800-plus restaurants. Stacked Restaurants LLC out of Irvine allowed customers to order their applewood bacon burgers on Apple Inc.’s iPads as early as 2011. Rollout plans The pioneer of tablets on tables was uWink, a restaurant concept from serial entrepreneur Nolan Bushnell. The company opened its first restaurant in Woodland Hills in 2006, but by 2010 it and the two other locations in the chain were closed and the company was out of business. Applebee’s owns 23 restaurants and has 2,011 franchised outlets, according to its latest annual report. The chain plans to introduce the tablets at its corporate-owned restaurants first. The company did not disclose a specific time frame on when the tablets will be placed in restaurant locations. The rollout will happen slowly and in phases. Robert Ancill, chief executive at Woodland Hills-based restaurant consulting firm The Next Idea, said DineEquity probably decided to not have its IHOP chain install tablets at the same time because of costs and training. “Most likely they will want to be sure it’s workable in one chain before addressing a second,” he said. In the long-term, the plans are for tablets at Applebee’s to have more sophisticated uses, such as showcasing nutritional information, displaying feature stories about the food and other exclusive content. “This is just making (order modification) easier – putting control in our guest’s hands. We understand that personalization and customization is the expectation today. Anything we can do to make that part of our dining experience is certainly a win for us,” said Smith, the spokesman.
The Right Touch?
