Restaurant response to COVID-19: 2 chains that elevated customer satisfaction, and 2 that failed to deliver

There was every reason to believe full-service restaurants were going to struggle compared to limited-service chains during the pandemic.

Not only did limited-service chains already have the proven business model to support expanded carry out and delivery, but customer satisfaction with full-service restaurants was already diminishing prior to COVID-19, down 2.5% to a score of 79, according to the American Customer Satisfaction Index (ACSI) 2019-2020 Restaurant Report.

Amazingly, that’s not what happened.

Per our new special COVID-19 restaurant study based on surveys collected from April 1, 2020 to Sept. 30, 2020, customer satisfaction with full-service restaurants climbs 1.3% to a score of 80, outperforming fast-food restaurants, which remain unchanged at 78.

Of course, as is always the case, some restaurants thrived, and others did not. Here’s a look at the two full-service restaurants that upped their customer satisfaction game during the pandemic and the two chains that failed to deliver.

Chili’s rises from the ashes

At the time of our last Restaurant Report, Chili’s sat at the bottom of the full-service industry with an ACSI score of 75. That’s no longer the case.

Chili’s climbs 4% to 78, tying five other full-service chains – Applebee’s, Cracker Barrel, LongHorn Steakhouse, Outback Steakhouse, and Red Robin. It now sits just two points off the industry lead.

While Chili’s doesn’t lead any of the customer experience benchmarks – and remains mostly in the middle of the pack – it’s made slight gains in multiple areas, including food quality and food variety. Customers agree that the restaurant’s biggest improvement is in store speed.

Red Robin flies out of the cellar

Red Robin wasn’t in the basement like Chili’s, but it was pretty close, tied with both Denny’s and Ruby Tuesday at 76. Red Robin has since flown in the right direction.

Red Robin jumps 3% into a six-way tie at 78. The gourmet burger chain makes small strides in courtesy, layout and cleanliness, order accuracy, and beverage variety. According to the data, Red Robin makes serious progress in terms of store speed and mobile reliability, placing it near the top of the industry in both areas.

LongHorn Steakhouse falls from first

Earlier this year, LongHorn Steakhouse led all full-service restaurants with an ACSI score of 81. Its rule was brief, and its fall was hard.

LongHorn Steakhouse joins Chili’s, Red Robin, and three other brands at 78 after plunging 4%. Its grip over the other chains in many of the customer experience benchmarks also disappears.

Save for mobile quality and reliability, LongHorn Steakhouse tumbles across the board. Customers find it especially worse in beverage quality, food quality, layout and cleanliness, order accuracy – all areas it once held or tied for the lead.

Red Lobster sinks toward the bottom

Red Lobster was previously tied with Olive Garden and Cracker Barrel with an ACSI score of 79. It’s since sunk below them both (among others).

The seafood chain now sits closer to the bottom of the industry after dropping 3% to 77. Aside from mobile app quality, where it remains steady, Red Lobster declines in every customer experience benchmark.

Per the data, its biggest drop-offs occur in beverage quality, staff courtesy, order accuracy, and store speed, where Red Lobster now scores closer to the bottom of the fast-food industry.

Full-service restaurants rise to the occasion

Full-service restaurants were on shaky ground when we released our latest Restaurant Report; just one restaurant improved, while seven out of 12 saw customer satisfaction slip.

Yet, since that time, the industry has shown toughness, resiliency, and flexibility. Now, six fast-food chains see customer satisfaction growth, and the industry is improving in many areas, including beverage quality, food quality, staff courtesy, order accuracy, service speed, and mobile app reliability.

While some restaurants struggled to meet customer needs during the pandemic, many identified their weaknesses and turned things around. All four of these full-service chains may have the same ACSI score of 78, but the paths they took to get there made all the difference.

Restaurants that want to do the same might want to take a page out of the Chili’s and Red Robin playbook.

Customer satisfaction case study: Amazon has the most to lose during COVID-19

Customers’ dissatisfaction with retail is very real. And, since the pandemic, it’s only gotten worse – especially for internet retailers.

Internet retail’s once-comfortable lead over the supermarkets, specialty retail stores, department and discount stores, and drug stores has all but evaporated, per our special COVID-19 retail study, which is based on surveys collected from April 1, 2020 to Sept. 30, 2020.

Since our 2019-2020 Retail Report, customer satisfaction with internet retail plummets 4.9% to a score of 77 – the largest decline within the retail space – as zero internet retailers improve during the pandemic.

As if this weren’t surprising enough, no internet retailer has taken a bigger knock on the chin during COVID-19 than Amazon.

How has Amazon fallen behind the customer satisfaction game these past six months? Let’s take a look.

‘Amazon in the Middle’

It’s not just that Amazon no longer leads the category, it’s that Amazon is no longer even in the upper echelon of internet retailers.

After tumbling 7% to a score of 77, Amazon finds itself firmly in the middle, tying five other companies – Staples, Best Buy, Target, eBay, and Macy’s – for the industry average.

As it stands, seven online retailers currently outpace Amazon, with Costco, Nordstrom, and Etsy all square at the top with a score of 80.

Amazon’s fall from grace isn’t because of any one thing; it’s from a customer experience meltdown across the board.

Flailing customer experience

Amazon doesn’t have the sole lead in any customer experience benchmark. According to the data, the drops have been significant.

The online giant’s largest decreases come in inventory, navigation, variety, shipping, and customer support. By comparison, Etsy experiences substantial gains in customer support, while Sears, which has the lowest overall score, makes strong gains in shipping.

Many of Amazon’s losses aren’t as sizable, but they are still noteworthy, including site performance, images, and site-generated recommendations.

In most cases, Amazon’s scores aren’t bad. The company is near the top in mobile reliability, clarity, variety, and site performance, and it shares the lead in mobile quality, store speed, shipping, and inventory. However, its marks in these areas have all declined over the past six months.

Amazon’s sales aren’t suffering … yet?

And yet, you’d never know anything was wrong with Amazon based on its sales.

According to May 2020 data from eMarketer, Amazon currently owns 38% of U.S. e-commerce sales. Furthermore, spending on Amazon between May and July was up 60% year over year, per Facteus.

But just because Amazon dominates the online space now, doesn’t mean it will forever.

The pandemic has accelerated the shift to digital, and many businesses are changing with the times. Walmart, Amazon’s closest competition at just under 6% of the market, recently launched its own membership program – Walmart Plus – to challenge Amazon Prime.

No one’s suggesting that Amazon will lose its stranglehold anytime soon, but it’s no longer the only horse in the race. And while the online giant’s sales are through the roof, changes in customer satisfaction do influence a household’s willingness to buy.

Over the past six months, Amazon’s customer satisfaction is trending in the wrong direction. Although this hasn’t affected the company’s sales, it’s something to keep an eye on. If this trend becomes the norm, Amazon could see sales sink just like its customer satisfaction.

3 companies that adapted to meet customer needs during COVID-19

Disney had big plans for the live-action adaptation of “Mulan.” COVID-19 changed that. So, Disney did the only thing it could do in the face of a global pandemic: pivot.

On Sept. 4, Disney released the motion picture exclusively on Disney Plus in the U.S. and other countries where the streaming app is available. The film cost an additional $30, but subscribers own it.

Does this offer the viewer the same experience they’d have watching it in a movie theater? Of course not. But is it a worthwhile alternative at a time when social distancing limits options? Absolutely.

The pandemic enhanced consumers’ voracious appetite for streaming, and Disney adapted. And it’s not the only company to do so.

Here are three examples of companies shifting to meet customer needs during COVID-19.

1. Papa John’s is going the ‘fortressing’ route

The pandemic hasn’t slowed down Papa John’s.

With sales surging in the Northeast – same-store sales up 30.3% in July – Papa John’s is increasing its footprint in the region. The company will open 48 new locations in Philadelphia and Southern New Jersey by 2028 thanks to a deal with franchisee HB Restaurant Group.

Taking a page out of the Domino’s playbook, Papa John’s is going the ‘fortressing’ route by building more locations near one another. The goal is to shorten delivery time and make carry out orders more accessible.

Customer satisfaction with fast food restaurants’ speed of checkout and delivery was down 1.2% to a score of 81, according to our most recent Restaurant Report. Building more clustered locations could help swing things in the other direction.

2. Walmart launches Walmart Plus

Companies that expand digital options may see greater success. Walmart is the latest to take the plunge.

On Sept. 15, the retailer launched Walmart Plus, a new membership program that has its sights set on Amazon Prime. At just $98 per year – compared to $119 for Prime – Walmart envisions this subscription service as a more affordable alternative. Walmart Plus offers customers unlimited same-day delivery of over 160,000 in-store items, including groceries, everyday essentials, and various electronics.

Walmart customers can also use the Walmart app to scan and pay for items in the store using the Walmart Pay feature. According to the retailer, this automated scan and go checkout service gives customers “a quick, easy, and touch-free payment experience.”

While Walmart Plus was planned before the pandemic, it directly addresses consumer needs right now. Still, this is a classic case of David taking on Goliath, as Walmart sits near the bottom of the internet retail sector and Amazon sits alone at the top. Time will tell if Walmart Plus moves the needle.

3. Burger King is taking the ‘touchless’ approach

Burger King is below average from a customer satisfaction standpoint, and it struggles in three key customer experience benchmarks: store layout, accuracy of the food order, and speed of checkout and delivery. The fast food joint plans to rectify this.

To adapt to current customer behavior, Burger King unveiled two restaurant designs that will offer a completely touchless experience. The “Next Level” design has up to three drive-thru lanes, with one specifically for delivery drivers. A conveyer belt also delivers food to drive-thru customers.

With the “Your Way” setup, customers can park and have food delivered to their car by scanning a QR code and using the Burger King app. This concept will also feature two drive-thru lanes and a walk-up window for takeout orders. Both restaurant designs have curbside and mobile pickup.

Fast. Contactless. Convenient. Efficient. Burger King sees what customers want – as well as the shifting landscape – and is adapting accordingly.

The message remains the same

Even in the middle of a global pandemic, the message remains the same for businesses: Customer satisfaction is paramount to your success.

As the landscape changes, so does the mindset of the consumer. If companies want to stay afloat, they must pay attention to what their customers want and adjust to fit these needs. It’s either that or get lost in the shuffle.