By Paul Barron, CEO/Founder of DigitalCoCo, Foodable WebTV & the Restaurant Social Media Index
Last year, my 2013 predictions had Facebook falling out of favor, the birth of the social chef, mobile consumers melding with brands, Twitter to become the Food FAQ platform for restaurants, and even casual dining getting a resurgence with more upscale offerings.
I had a few other key ones that had some impact in 2013, but all in all I can say I had about 80% right on target. Not that it’s that great of performance considering most were pretty easy to call. So this year, I feel like I need to go out on a limb and really stretch the idea of predictions and how they can impact the industry. With that said, here goes my annual 2014 Social & Digital Predictions.
Prediction No. 1: Chipotle gets the boot as the leading restaurant brand performer.
The idea behind this is part in data and part in intuition. With consumers becoming even more aware of sustainable actions and sourcing, I fear that Chipotle may be playing this card too close to their vest with no option out. I predict that we will see consumers attack the burrito brand this year while also seeing a falling stock price. Chipotle will have some difficulty battling the rising stars of the upscale fast casual segment.
Prediction No. 2: OpenTable gets challenged or acquired.
Reservations will become more and more important to the Big Four – Google, Apple, Facebook and Twitter. All are vying for local-level business, and what better way to connect with local than reservations? Combine that with more than 400,000 independent restaurants in the U.S. alone representing about 11 billion meal occasions and you have a big carrot on the end of that stick. That’s big business since OpenTable and City Eats are the only two real players in this market. I expect some big changes in this area of the business.
Alternative Prediction: OpenTable gets more social through acquisition or partners with someone like Marissa Mayer over at Yahoo, which will spoil or delay the plans at Google and Apple, both of which I think are the front runners to invade the space.
Prediction No. 3: Apple activates over 600 Million to food transactions.
Apple has over 600 million iTunes users and is currently activating over half a million accounts per day, which means they have a credit card on file for each. App purchases have grown over 300% in the past year, and 2013 marked their 25th billion song sold in the store. Add this to the purchase of Topsy, a social data company, and the almost secretive rollout of the iBeacon (learn more about VenueBeacon here) and you have an ecosystem brewing. This creates an interesting analysis when you combine built-in commerce, social data and location to the mix. No one else has all three. Now simply turn on a reservation system or online food ordering system that is app-driven and connects to your iTunes account – all driven by social and location data – and you have a new guerrilla in the game.
Prediction No. 4: Sharing economy explodes and could include breaking bread.
Uber and Airbnb are the poster children of a new economy of logistics and transportation alternatives, but the real opportunity is the sharing of the share itself. Imagine if you could share an Uber ride with another Uber user – would you get a better rate? Apply that to a new way to mix and mingle at a restaurant. Share a table with like-minded people to get a chance to meet new friends. I have migrated to community tables more and more in restaurants and often find myself meeting new and interesting people. Manage this with a social dining profile of sorts and you have a new social network that is related to real life around food. Mix in a little music and a bit of art. Hmm, sounds like iFooding to me.
Prediction No. 5: Restaurant Food Networks emerge.
I have been calling this one for a few years and maybe this year is the year that we see a restaurant brand create a Red Bull or Esquire event with social content as a catalyst to build their business. This could begin the process of these companies becoming restaurant media groups within their markets. This does a few things in connecting to guests, but it also creates the new personalities that will dominate the web soon, all at a local level. The Food Networks days are numbered, as are the way of the middlemen of the music industry.
Prediction No. 6: McDonald’s takes out Starbucks.
OK, I realize this is a sensational headline, but the crux of what I mean is that this year, McD’s will overtake Starbucks as the global leader of connected social media consumers. Starbucks has reigned supreme for over five years, amassing more than 35 million Facebook fans along with 6 million global Twitter followers. McDonald’s is on track to surpass them this year and are currently at 32 million social connections vs 41 million for Starbucks. The real story is the social ecosystem of McDonald’s, which currently leads Starbucks with over 58 million global connections vs 49 million for Starbucks. Though it's a tall order, I think this is the year that the coffee king gets the social boot.
Prediction No. 7: New High Flyers break the norm in Fast Casual.
We have all watched the Fast Casual segment break out over the past five years, and I personally have been tracking this space for over 20 years. Many of the players that are dominating the segment now were not even around in 2008. One thing I’ve always loved about this segment is the innovation. That said, here are a few to watch for, taking out some of the headliners this year: Umami Burger gets the burger crown; America’s Taco Shop has a chance to move fast; Cava Mezze creates new ethnic; Pitfire Artisan Pizza dominates the emerging Fast Casual Pizza segment; and The Juice Spot might have a chance in pressed dominance.
Prediction No. 8: Cryptocurrency invades the food biz.
With the rise of Bitcoin and Litecoin with a market cap of over 10 billion, I expect the early adopters to begin to look for restaurants and services that accept this currency. Food is an everyday product and the ability to move to a cryptocurrency for the industry might become a competitive advantage. Though it is still super early, the adoption will come in a few years. With digital cash, cryptocurrency – whatever you want to call it – the digital consumer is here and new ways to connect payment, especially digitally, will become an interesting area of development for the restaurant business. Oh, by the way, there are no fees like credit card fees via the current model of cryptocurrency, but I expect there will be some services that build a new fee structure to accommodate such payments.
Prediction No. 9: Snapchat and Tumblr could surprise us.
There are so many ways that Snapchat could be fun for use in the business ecosystem, the problem that I see is the decentralized use of social has created the need or desire to become centralized once again. It always seems to move in cycles from AOL to MySpace to Facebook to ??. The evolution of the digital consumer is never-ending, but our desire to communicate and socialize is even greater and the real question for most brands is: What platform will reign supreme in 2014? My wager is put your big bet into Twitter, Google Plus and YouTube, and lay a little on the line with Tumblr and Snapchat as outliers for the youth. Continue your middle America plan for Facebook and you will be fine.
Prediction No. 10: Foodable WebTV will be the next era Food Network with 38 million strong.
The digital age is here and the consumption of video is outpacing every aspect of digital life except mobile, which is the chosen platform of video consumption for the future. The food culture is here to stay. Consumers are foodies and foodies are soon to be operators and chefs, and they have been growing at an enormous pace in the past three years. In fact, there are currently over 38 million social accounts that claim to be a restaurant operator, foodie, chef, bartender, mixologist, and over 50 million when you add in that they are in the business. The future celebrity chefs/digital brand stars will come from the web and thrive in the digital ecosystems that are built to welcome them in with the power of social, digital brand building and new media.