Over the past few months a dozen companies have sprung up offering to build customized iPhone apps for restaurants, and it seems like more are springing up every day.

http://www.appcoco.com http://www.appdar.com/restaurants http://backpocketmenu.com http://www.moglumedia.com/rbn http://www.99mobileapps.com http://www.blueshoemobile.com http://mymenumobile.com http://www.mobilaurus.com/restaurants.htm http://www.biznessapps.com

We briefly toyed with this idea at ChompStack, before realizing that it was a really terrible idea and moving towards something much more practical. Here are five reasons why a custom iPhone app makes absolutely no sense for your restaurant:

1. You already have a website.

   Your website already contains all of the information that a potential customer might need. Menu information? Check. Address and directions? Check. Promotions? Check. Interesting photos of your restaurant and your food? Check.

   If you’re into social media, you probably have a Twitter account and Facebook fan page set up too, and are using those tools to build an audience.

   A custom iPhone app really doesn’t offer any value to your customer over a normal website.

   The only caveat is that if your current website is built in Flash, your customers won’t be able to see it on their iPhones and their iPads. In that case, you should really think about creating a mobile compatible version, so your customers can read your menu and look up your address from their phones, and to avoid driving away customers.

2. Only 16% of your customers have iPhones. What about the rest?

   The latest research shows that Apple only has 16% of the smartphone market. There’s no doubt that Apple’s share is growing, but Nokia and BlackBerry still dominate the market.

   Launching an iPhone app marketing campaign, that at best, can only reach 16% of your potential customers, seems like a poor choice.

   Doesn’t it make more sense to be able to reach BlackBerry, Nokia, Android, and Windows Mobile users too?

3. They’re expensive.

   While the costs have been coming down, getting a custom iPhone app built is still quite expensive. You’re paying way more money (ranging from hundreds to thousands of dollars) for an iPhone app that only reaches a tiny segment of your potential customers.

   Where’s the ROI in that?

4. No one is going to download your app.

   The fact of the matter is that no one is going into the App Store to look for new restaurants to try. Having an app in the App Store isn’t going to get you any more eyeballs.

   The only people who are even going to know your app exists are the people who have either already been to your restaurant, or people that have already gone to your website. That’s great, but how does it help you draw new business?

   And once they’ve gone to your website and have found all the information they’re looking for, why would they want to bother downloading your app at all?

   Furthermore, in order to attract people to download your app, you’ll have to spend time and money promoting the app. This is in addition to the cost of getting the app developed in the first place.

5. No one is going to keep your app on their phone.

   I’ve had an iPhone since launch, and it is already cluttered with tons of apps I never use. I’m not really interested in downloading more. I’d much rather be able to pull up your website on my phone when I’m looking for a restaurant, not managing and downloading individual restaurant apps. If I do download a restaurant app (cause that’s the only way to look at the menu), I’m going to delete it immediately once I’m done with it.

Don’t get me wrong, in this modern age of smartphones and always connected internet, I think that having a mobile presence is critical for restaurants. Consumers *are* using their phones to search for new places to eat, and you want to make sure that customers can find your restaurant and browse your menu from their phones.

I just think that having a custom iPhone app is completely the wrong way to go about it, and there are much more cost effective approaches that will let you reach a much bigger audience.

Exception: There’s one exception to this, which is for large, established brands like Chipotle, Starbucks, and Pizza Hut. They already have massive brand recognition, and therefore their customers are happy to download their apps. They also have the marketing budget to produce apps that are highly customized to their specific brand, often integrating with their point of sale systems to provide online ordering, etc. These brands can get effective ROI from an iPhone app because of their large, established customer base.

We have been busy improving ChompStack’s restaurant mobile website builder over the past month and I’m excited to announce some of our most recent additions:

1. Image Galleries

   You can now upload photos of your restaurant that will automatically be placed into an image gallery on your mobile website. Here’s what the gallery looks like:

   

   

2. Multiple Price Levels

   You can now add multiple price levels to a single menu item using our control panel. This is useful if you offer the same menu item with differently priced sizes.

   The procedure is very simple: on the item editing screen, click ‘Add Price’ to add a new price level for your menu item. You can optionally enter in labels for each of the prices, for example: Small, Medium, and Large.

   

   Click the 'Add Price' button to add a new price level.

   

   Then simply enter in the name and price for each price level.

3. Google Analytics

   We now support Google Analytics site tracking. Simple fill in the Google Analytics field in your mobile site setup page with your tracking code, and you will be able to track the traffic on your site.

   

That’s all for now, but we’re working hard on more improvements to make ChompStack the best restaurant mobile website builder out there. Stay tuned for more!

Research company Compete has released the results of its first-quarter 2010 Smartphone Intelligence Survey, which studies how consumers are using iPhones, BlackBerrys, Android devices, and other smartphones:

The survey found consumers increasingly rely on their mobile phones to search for retailers. Nearly one in three smartphone owners has called or stopped into a local business after finding it using a local search application, according to the results of the survey. In Q1 alone, close to a third of Android and iPhone owners discovered at least two new businesses that they were not previously aware of as a result of using local search applications.

“With the increasing popularity of local search, retailers should ensure their sites are optimized for mobile browsers,” said Compete’s director of technology and entertainment Danielle Nohe. “Making it easy for consumers to discover businesses via their devices opens local companies up to a whole new customer demographic, and savvy businesses should make sure they’re maximizing this opportunity.”

The key result: consumers are now turning to their phones to discover local businesses. Businesses must shift their marketing strategy to accomodate the growing mobile landscape, or risk being left behind.

Does your restaurant have a mobile website?

A mobile website is a critical component of a restaurant’s local search presence. Consumers are searching for local restaurants on their phones, and expect to be able to view the restaurant’s website to look up menu information, store hours, and directions.

Restaurants without a mobile presence are missing out on a massive opportunity to drive new customers into their stores.

ChompStack can help your restaurant create a mobile website

Our mission at ChompStack is to make sure that every restaurant has a mobile website that your customers can easily access from their phones. ChompStack is easiest and most cost effective way for a restaurant to build a mobile website.

ChompStack will help you drive new customers into your restaurant by building an engaging mobile presence.

Click here to get started.

Over the past few months we’ve been talking to many restaurants about their mobile marketing strategy. Many of you simply want to upgrade your existing websites to add support for mobile phones like the iPhone, Android, and BlackBerry. We have heard your feedback and have been working hard to build a service that suits your needs.

Today we are proud to announce the launch of our new service: ChompStack’s mobile website builder for restaurants.

Why Mobile Websites Are Important

With the mobile internet growing at an exponential rate, it is now critical for every business to establish a mobile web presence. Customers are increasingly turning to their phones to search for nearby restaurants, read reviews, look up menus, and find directions. By 2012 there will be more mobile devices connected to the internet than desktop PCs*, and that is an audience restaurants cannot afford to ignore.

Currently, very few restaurants have websites that are mobile enabled. Most websites designed for the desktop don’t work well on mobile phones: they take a long time to download, and navigating the site is a frustrating experience requiring lots of zooming and scrolling. If the website was built in Flash (and many restaurant websites are), they simply don’t work at all.

Our mission at ChompStack is to make sure that every restaurant has a mobile website that your customers can easily access from their phones. We want you to have a fast loading, fantastic looking mobile website that lets you reach a whole new audience. We want to make it easy for your customers to pull up your menu, to find out about your latest promotions, and to get driving directions to your nearest location.

Mobile internet usage is exploding, and consumers are getting more savvy. 42% of consumers in the United States currently have smartphones*. Every day, millions of consumers use their phones to look up nearby restaurants to find a new place to have lunch. We want them to easily discover your restaurant through your mobile website.

What Makes ChompStack Special

ChompStack’s mobile websites are very different from traditional desktop websites. We want your customers to have the best possible experience when they are viewing your website on the go. To achieve this, we have designed a mobile website interface that has been specifically optimized for phones:

1. Built for phones. Many websites built with desktop technologies such as Adobe Flash simply don’t work on smartphones like the iPhone or BlackBerry. All of our websites are built with technologies that work beautifully on the phone, so you never have to worry about whether or not your customers can see your site.
2. Designed for small screens. Desktop websites require lots of zooming, pinching, and scrolling when viewed on a phone. This can be an incredibly frustrating experience. Our mobile websites are specifically designed for smartphone screen sizes. We use large fonts to make things easy to read, and big buttons to make navigation simple.
3. Optimized, fast downloads. On a mobile device, websites need to load fast. Users don’t have time to wait around for websites to download large images, PDFs, and other files. We have carefully optimized our websites to load as quickly as possible by minimizing our file sizes and compressing all downloads. Your customers will notice the difference.
4. Takes advantage of smartphone features. Modern smartphones can easily integrate one-click calling and Google maps directions from your website. We take full advantage of these features to make things as easy as possible for your customers.
5. Supports thousands of mobile devices. We have carefully ensured that our mobile websites are supported on the iPhone, BlackBerry, Android, and other smartphone devices. As new phones come out, we will keep making updates to ensure that your website loads and works great on every device.

If your restaurant does not yet have a mobile optimized website, we encourage you to give ChompStack a try. You can get up and running in less than a day. Your customers will thank you.

* Source: Morgan Stanley Mobile Internet Report

We are always on the lookout for innovative companies building new types of restaurant technology. Every few weeks we will collect a roundup of the most interesting restaurant technology news and share it with you. This week, it’s the iPad that is making the headlines.

Urbanspoon Wants To Challenge OpenTable With Its RezBook IPad App

Urbanspoon plans to continue its assault on OpenTable, and its weapon of choice is going to be the iPad. I am not talking about Urbanspoon’s slick iPad app which is already out and is aimed at consumers. I am talking about the RezBook, which is part of Urbanspoon Rez and is aimed at restaurant owners.

When it comes out in June, RezBook will be a full reservation system. Instead of writing down reservations in a paper book, restaurant owners will be able to enter them directly into the iPad, see bookings by time and by table. With a $500 iPad and RezBook, any restaurant will be able to afford a computerized reservation system.

Urbanspoon co-founder Ethan Lowry says:

“I think OpenTable has had a monopoly in the industry for a long time and restaurants are eager to have alternatives. We compete by offering much more favorable pricing, a flexible, easy to use interface, and (with the iPad) a portable, off-the-shelf, inexpensive and beautiful piece of hardware. We’re certainly getting a lot of excitement from restaurants.”

Personally I’m quite excited to see if Urbanspoon can make a dent on OpenTable’s business. To my understanding, OpenTable’s fees are quite expensive, both in terms of initial hardware costs as well as monthly service fees, and many restaurants can’t justify that kind of cost. As consumer tech gets cheaper and cheaper, it is great to see some of the cost savings make their way back into the restaurant industry. My main concern, as mentioned in my previous post on the feasibility of using iPads in a restaurant environment, is whether a consumer electronic device can withstand the hazards of a restaurant. Since a reservations tablet will likely be placed in a fixed location at the host stand and not carried around by servers, it is in a fairly safe spot.

T1 Visions Unveils New Social Technology at National Restaurant Association Show

T1 Visions LLC, a technology company that specializes in interactive touch screen solutions for restaurants, recently exhibited at the National Restaurant Association (NRA) Show in Chicago, where Mike Feldman, company president and inventor of the T1 Connection Booth, discussed what’s new in technology for restaurants at the kick-off panel discussion titled “Fresh Approaches in Foodservice IT.”

Formed in 2007 in Huntersville, N.C., T1 Visions is the latest venture for Feldman, a successful information technology entrepreneur. Along with his former partner, Jim Morris, Feldman invented The Connection Booth, a durable interactive table integrated with a touch screen tabletop, audio system and high-definition video screen, designed for use in restaurants, bars and nightclubs.

We first heard about these guys a few years ago, they definitely have an interesting concept. They were one of the first companies to put a multitouch table into a restaurant environment (the other being Microsoft Surface tables at a few places in Las Vegas). This kind of tech might be appealing to a few experimental restaurants looking to try out new concepts, but the main drawback, which will likely prevent it from reaching mainstream adoption, is the massive cost associated with installing a multi touch device at every table. Not to mention the maintenance overhead: your entire table is a touchscreen? That’s just more surface area to spill drinks on! No, tablets are more likely to win this battle.

Restaurant has iPad waiters, Foursquare and Twitter tie-ins

Imminent New York City restaurant 4Food has provided first details of an Internet-focused approach to its business. The midtown Manhattan burger shop will let visitors customize and order food over the web, including for pickup, but will also have waiters with iPads for those who want to order in person or eat in. The design is also patterned loosely after that of an Apple store and will have free Wi-Fi.

This is a timely announcement given my blog post wondering about the feasbility of iPad based point of sale devices. I guess we will see how well the iPad fares in a live restaurant environment.

These guys are definitely going after the techie consumer crowd – I doubt that most restaurant folks are particularly interested in streaming FourSquare checkins and Twitter messages. The challenge with concepts like these is getting the fundamentals right: no amount of flash bang whiz tech matters if your food or service isn’t top notch. (And that’s speaking as someone that loves flash bang whiz tech).

I recently read a very entertaining thread on a restaurant technology forum which was basically a discussion of whether or not open source software is appropriate for the restaurant industry. It began when one poster touted the merits of his newly minted open source Point-of-Sale (Java, enterprise, yadda yadda yadda). For his efforts he was pretty much unanimously denounced by the POS resellers haunting the forum like the ghosts of Internet-past. They seemed to have all reached the same conclusion: that being open source means their 12 year old geek nephew will stop what he’s doing for an entire minute so he can hack into your POS, erase all your transactions, order two million pizzas, and then calmly go back to playing Halo or Tetris or whatever it is you kids do these days with your magical Internet skillz.

First I'll pwn you and then we'll pair program some Java!

So let’s dispel a few myths. When it comes to restaurants, I have a rather unnatural resume. I’ve worked for exactly 17 restaurants, in every position from dishwasher to bartender to waitress to manager to IT person. By working in these myriad capacities, I discovered the 3 fundamental truths of the restaurant industry, with which I shall now regale you: 1) never carry a bar towel in your back pocket because it bleaches your pants, 2) counting out a cash drawer at the end of the night is a better teacher of chaos theory than college physics, and 3) the Point-of-Sale industry is the biggest scam ever perpetuated on man or beast.

While technology in other sectors grows more innovative and cheaper by the minute (iPhone/iPad, augmented reality, HTML5, open source web servers, etc), restaurants are still handing out pagers and shelling out $20,000+ for a 2-terminal POS install running Windows 98. As a software developer, it hurts me almost physically to watch restaurant owners recoil in fear from the perceived threat of an (gasp!) open source POS. What follows is a discussion of major open source myths, written specifically for the good people of the food service industry.

Two forum replies in particular caught my attention. In the first, the responder made the impressive assertion that open source software “should NEVER be used for any financial control functions…The reason for this statement should be obvious. Open source, by definition, can be modified by anyone with the prerequisite programming skills.” And then, onto the scare tactic: “Do you want your computer literate bartender to be able to make every third tab disappear from your financial results?”

MYTH #1: Your bartender is actually Linus Torvalds.

Linus Torvalds, the creator of the Linux operating system.

Your bartender, the creator of Topless Taco Tuesdays.

Is your bartender going to be modifying your open source Point-of-Sale source code and then reinstalling your POS when you’re not looking so that he can void those beers he gave away for free? I think not. And here’s why:

1. He’s a bartender. That means his skill set is generally relegated to: pouring drinks, talking about his imminent acting career (I live in LA), making light banter with businessmen, and hefting the occasional keg. Bartenders in Los Angeles might make bank ($100,000+ a year, even), but a good programmer makes at least that, and they get lunch breaks and 401Ks and respect, too. Trust me, the chance that your bartender is contemplating warez and backdoors and Java compilers as he is pouring that Heffeweizen is about the same chance that your hostess is manufacturing nuclear reactors on the weekends. Owning an iPhone and a few ironic t-shirts does not a hacker indicate.
2. There are easier ways (about a million of them) to steal from a restaurant when you’re an employee, and they don’t require a knowledge of .NET. While you’re fretting over whether or not Julie the waitress is conspiring to take control of your print server, she’s writing down customer credit card numbers on the back of her notepad. Why would she bother to develop mad coding skills when all the sensitive financial data she needs is handed to her everyday, by every customer she waits on?
3. This is kind of a reiteration of the previous one, but seriously–if your bartender wants to steal from you, what’s more likely, that he or she will acquire the equivalent knowledge of a master’s degree in Computer Science, or that they’ll pour a beer and take the cash from the customer without ringing it in? I know where I’m placing my bets.

So now we’ve established that your bartender probably can’t and/or doesn’t need to hack your point-of-sale, irregardless of open source. Still worried about hackers masquerading as restaurant employees? Here’s a handy quiz to give your staff.

QUIZ: IS YOUR EMPLOYEE A ROGUE HACKER HELLBENT ON YOUR DESTRUCTION?

Hackers. Oh yeah, this is totally what we look like.

1. What is Python? (If they answer, “a big snake”, they should be immediately dismissed as a potential threat. Actual answer: an interpreted programming language)
2. If I asked you to sketch a for loop in any language on a napkin, could you do it? (Hint: if they draw a big “4″ on the napkin in a looping scrawl, they won’t be keylogging your terminals)
3. Which do you drop more frequently, trays or databases?

Back to the forum post. The other forum reply that caught my eye came from a poster with a rather unique definition of open source: “If it’s open source… anyone can make changes… if it is not open source… the program can not be altered.” and even goes so far as to assert that “Open Source POS code would be hacked to the extreme for good and evil purposes…There are thousands of trojans, worms, scripts and other which their sole purpose is to cause harm and fuk with people. All built by wannabe programmers…”

MYTH #2: Open source software is inherently insecure.

There seem to be two branches to this arguments, and I think the forum quotes nicely illustrate both. The first branch of this argument alleges that because the source code is accessible to anyone, it might be messed up by evildoers or the incompetence of a part-time programmer (as we all know, full-time and competent are synonymous). However, I would argue that source code exposure is a double-edged sword. Generally on any open source project there exists a main branch with a group of maintainers (often the original writers of the software) who review patches and features before incorporating them. This means that when you create your “trojans, worms, scripts”, and if you’re foolish enough to submit them, the huge number of eyeballs watching that source code will be like, WTF?? Whereas in a closed source project you might be able to get away with it; I’ve definitely worked for companies producing proprietary software who scoffed at the overhead required by code review.

The second branch of this argument is that open source is just wobbly, unstable, poor quality code, a sort of hobo code; and we don’t want that hobo code, we like our code certified and proper, with slicked back hair and maybe wearing a nice Italian suit, if you please. But what you may not realize is that the motivation behind many open source projects (Python, MySQL, Apache, Linux, Git) was to create something that worked better than the closed, proprietary versions controlled by corporations and bureaucracy, to create a space where brilliant programmers could collaboratively write and maintain software they actually wanted to use, and where they could protect it from lawsuits and corporate greed by slapping it with a shiny GPL (or LGPL, your call). It’s a mistake to think that closed source projects are more actively maintained than their open source brethren, because the truth is, mileage varies for both sides.

Our forum friend also has a few metaphysical questions about open source: “Why promote Open Source? Do you programmers not want to be paid for your work? What do you only want part-time editors making changes as their hobby? It just doesn’t make sense to me. Please explain if I’ve got it wrong, but that won’t change my opinion.”

MYTH #3: Open source programmers don’t like real money and in fact prefer to be paid in Stanley nickels.

Firstly, $1 to anyone who gets the reference (a Christine dollar). Secondly, open source projects aren’t merely weekend hobby code, and open source programmers aren’t in it because they aspire to sainthood. Take a look at the freemium business models employed by MySQL and WordPress, among others. The code might be free, but the support and premium features cost money: hopefully enough money to support the business. Alternatively, many open source projects have large companies (in technical terms, sugar daddies) funding their development, such as Android, which is funded by Google.

Why should you appreciate open source software?

The point of open source is simple and beautiful: no one wants to recreate the wheel every time, and technology can progress drastically faster if we share code that can be reused. It’s important to realize that closed source does not correlate to security or quality, but what it does do is make sure restaurant owners continue to pay big bucks for their technology, no matter how much power we have to change that.

Over the past few weeks there has been some talk of companies building restaurant point of sale software to run on the iPad. This sounds fun, but I’m not sure anyone who has worked in an actual restaurant environment would consider it a good idea. The iPad was not designed for a restaurant environment and would probably drive waitstaff and managers alike crazy. Here’s why:

1. It’s a brick. Servers are already carrying around trays, plates, and glasses all the time. To ask them to carry around another device, it needs to be lightweight and not get in the way of their regular tasks. They need to be able to pull it out, enter an order, and then put it away without any hassle. The iPad’s user interface is spectacular, but when it’s weighing your apron down so much that you look like a bad Charlie Chaplin skit then it’s probably more trouble than it’s worth.
2. It’s unwieldy. Servers often need to have both hands free. They need to be able to slip the iPad into an apron pocket when they’re not using it. Unfortunately, the iPad is a little too big to comfortably fit inside an apron pocket, and even if it could, its excess weight would  cause it to drag the apron down (see Charlie Chaplin reference, above). An iPhone is a much better fit, but it is probably too small to use as a touchscreen terminal. The ideal size might be something more akin to a Kindle or Nook.
3. It’s too fragile. The iPad is a consumer retail device, not something particularly well suited to the madcap frenzy of a restaurant environment. It will get dropped, people will spill drinks on it, and it will be exposed to all sorts of other random hazards (do you prefer your iPads deep-fried, or grilled?). Suffice to say, it will get destroyed after a few months of use. Realistically, a tablet needs to be retail-hardened before it can be used in a restaurant.
4. It’s too expensive. At $500 a pop, these devices are going to be too expensive to replace when they break, and they will break. There’s a reason most point of sale terminals use retail-hardened hardware, and not commercial off-the-shelf computers. Here’s a little math for you: if you pay your waitstaff the standard, criminally-insane-but-government-sanctioned wage of $2.13 an hour, for each approximately $700 iPad you purchase, you’re paying 329 man-hours. Not to mention the $15-30/month/device data plan. At that price, it might actually be cheaper to hire someone to run around after each member of your waitstaff and be used as a multitouch device. “Just swipe Kenneth to activate!”
5. It’ll get stolen. Again, because of its high retail price and its value as a consumer electronic device, the iPad is a prime target for theft. Who knows how long an iPad will last in the store before it magically ‘disappears’?
6. Wireless is unreliable. Most restaurants have industrial-strength microwave ovens that wreak havoc on wireless signals because they operate around the same frequency range. Dropped connectivity is unacceptable when you’re trying to enter in orders or process credit cards. Currently, the only way around this is performing a professional installation, measuring the wireless signal throughout the restaurant, and making sure to install repeaters in the right place. This is fairly expensive.

Basically, the iPad is not well suited for restaurants because it is a consumer electronic device, with a higher than normal price point and no retail hardening. A much more realistic solution would be a retail hardened mobile POS tablet, perhaps based on cheaper hardware running on Android. Less expensive, Android-based tablets are in production now and will start shipping in the second half of the year, so we’ll see what happens.

Despite the iPad’s flaws, there are several potential benefits to using a mobile point of sale device in restaurants:

1. Servers can record orders immediately, reducing the likelihood of mistakes. Instead of having to memorize the order or write it down in shorthand, the server can directly enter the orders into the POS system at the table.
2. It reduces the time spent waiting for an open POS terminal. Because each server can carry their own individual POS device, they don’t have to worry about waiting in line to access one, and they can stay ‘logged in’ to the POS device between transactions.
3. Processing credit cards at the table can reduce fraud concerns. If servers have to directly swipe credit cards at the table, this reduces the possibility of credit card theft, since the credit card never leaves the customer’s sight.
4. Reduced cost. It is predicted that $100 Android tablets will ship in the second half of 2010. This is a much more cost effective solution than both the iPad based tablet, as well as expensive standard point of sale systems.

At ChompStack we welcome these innovations in the restaurant technology space and hope that they are embraced by the next generation of point of sale vendors. Restauranteurs are increasingly turning towards technology to help them reduce inefficiencies and increase margins, and we think that mobile POS units are a great step in the right direction. We’re excited to see what happens over the next few years.

Welcome to Back of House, ChompStack’s blog. We make iPhone apps for restaurants and we’re interested in everything to do with food and technology, be it iPhone and iPad apps, Point-of-Sale software, websites, online ordering, KDSs, and all sorts of other magical acronyms. We’ve worked in quite a few restaurants ourselves, in almost every position, from dishwashing to IT  to management, and based on those experiences we’ve developed an appetite (sorry, couldn’t resist) for the creation of restaurant apps and software that’s fun to use, reliable and fast. As we develop our apps, we’ll be engaging in a discussion of what restaurants need, and how they work, when it comes to technology. We’re glad you found us, and we’re eager to hear your thoughts.

Best,
The ChompStack team