Pizza Hut, KFC Embrace Web Over Apps for Hungry, Global Customers

June 3, 2014, 5:59 PM ET

Pizza Hut, KFC Embrace Web Over Apps for Hungry, Global Customers

CLINT BOULTON

Yum! Brands International is upgrading its Pizza Hut and KFC websites to allow consumers to order from any device with a Web browser, says Baron Concors, Pizza Hut’s chief digital officer. The websites will be built with HTML5 which better supports site performance across different devices and different size screens.

“Online ordering is a science… you need one great way because it’s all about simplicity for the customer,” said Mr. Concors, who added that as much as 60% of Pizza Hut’s orders are placed online. Mr. Concors said improvements in Web technologies will push more retailers to build websites whose screens automatically right-size to consumers’ devices, and to rely less on delivering more mobile apps that occupy precious real estate on smartphones.

Yum! does make ordering apps for iPhone and Android smartphones, as well as Xbox 360 gaming consoles, but for its increasingly global audience, the company was looking for a solution that did not involve spending millions of dollars building applications to run on smartphones and tablets tailored for every country.

Yum! found the answer in the World Wide Web. Working with application developer Tillster Inc., Yum! devised a framework for a website that will allow consumers to order and pay online, for pickup or delivery.

Mr. Concors may see something others don’t, as his thinking runs counter to current industry trends. Burger King Worldwide Inc.Wendy’s International LLC and Panera Bread Co. have all launched new mobile apps to appeal to a digitally-savvy generation of consumers. More than 10 million consumers use Starbucks Corp.’sSBUX +0.45%mobile app to pay for coffee and receive loyalty reward points toward future purchases from their smartphones.

But Mr. Concors said consumers shop at Starbucks with greater frequency — four to seven times a week — than they do at any other retailer, including fast food. “[Starbucks] sells a narcotic people like,” said Mr. Concors. Consumers are more willing to use an app for a retailer they’re going to visit almost daily, he said.

As much as Yum! would love to have loyal customers that frequent its brands daily, Mr. Concors knows that is unlikely. But he said online ordering from computers, smartphones and tablets is ramping up, with anywhere from 30% to 60% of orders come digitally across Pizza Hut and KFC stores in 120 countries.

Yum! is rebuilding its websites with HTML5, a markup language that enables Web browsers to store data locally for more rapid information retrieval. Ted Schadler, an analyst at Forrester Research Inc., said that HTML5 contains commands that allow websites to dynamically adjust to smartphones, tablets and larger screens, irrespective of operating system type.

The company has already rolled out its website redesign for Pizza Hut in Canada and KFC in Thailand, with plans to expand to many more markets, including Hong Kong and Latin America, and eventually, the U.S. Mr. Concors declined to say how much the website redesigns are costing Yum! He also declined to say whether Yum! would introduce loyalty rewards programs for its brands.

Mr. Concors believes that, over time, improvements to HTML5 and future versions of the standard will make the Web the vehicle with which consumers interact with brands. “Mobile apps won’t go away… but as I look forward in the future, I see a time when they will be less necessary,” said Mr. Concors.

 

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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