Taco Bell disrupts fast-food ordering with new app

For tech-savvy diners, snagging a Taco Bell burrito is now merely a few swipes away.

On Tuesday, the Yum Brands-owned fast-food chain launched a new mobile ordering and payment app that works both for in-store and drive-thru pickup available nationwide at participating restaurants. It's touting the app as the first such one in the fast food industry.

Still image from Taco Bell mobile app video
YouTube: Taco Bell
Still image from Taco Bell mobile app video

Available for both iPhones and Android devices, the app allows customers to order and pay for their meals using credit cards or Taco Bell cards ahead of driving to the restaurant. Once they arrive, the app prompts them to check in so workers can begin preparing the order. When it's ready, customers can pick it up in a separate line in stores or via the drive-thru.

To promote the app, Taco Bell's social media platforms went dark Tuesday to tell followers that the new way to Taco Bell is in the company's app.

For Taco Bell, the app represents the latest step in a broader tech revamp. So far, the brand changed its point-of-sale system and is in the process of updating its back-of-house technology.

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During a phone interview, Taco Bell President Brian Niccol said the app is "step 1" of furthering growth at Taco Bell as it plots to double its yearly revenue to $14 billion by 2022.

"It'll enable our team members to be more accurate, offer more customization and even be faster," Niccol said.

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In a private beta test of the new app in California with hundreds of customers, average check, guest frequency and speed improved.

Taco Bell is far from the only restaurant eyeing mobile as a key component in reaching today's customer with many fast-food giants, including Wendy's and Chipotle Mexican Grill launching mobile services. Others, like Panera Bread and McDonald's, are jumping on the Apple Pay wagon to offer customers another way of paying. One early adopter in the mobile app space that has seen success is coffee giant Starbucks.

Mobile payments now account for more than 15 percent of all transactions at its U.S. company-operated stores, it told analysts in July. By next year, Starbucks plans to rollout mobile ordering nationwide as it seeks to get an even bigger foothold in the mobile space.

Darren Tristano, an executive vice president at Technomic, said mobile payment reduces the opportunity for worker theft and credit-card hacking while also decreasing the amount of time that people have to wait for their food—an important result in an industry that emphasizes speed.

Integrating mobile ordering and payment into a restaurant's point-of-sale system takes time though. Taco Bell spent two years creating the app and working out any kinks.

Offering mobile services is becoming "increasingly important," especially as restaurants try to attract younger customers who use their phones as a 21st century wallet, Tristano said.

"In five years, it may be a necessity so getting in on it sooner rather than later would be a benefit to all operators who can afford it," he added.