by Vladimir Edelman, chief development officer of NTN Buzztime, a bar and restaurant social entertainment and integrated marketing platform.
Restaurants as we know them have remained the same for over 200 years, and fables about amazing restaurant tech have inevitably leapt to futuristic ideas: robot waiters, food printers, talking refrigerators. Today’s reality is far more interesting and complex than those sweeping visions. A tsunami of technology, both from established industry providers such as POS and IT companies, as well as nimble startups such as olo and NoWait, are changing the way the hospitality industry functions and what consumers will grow to expect.
This new tech creates the “Dorothy Effect”: We are all at once enthralled by the “magic” we now experience on a daily basis, while also being forced to face and fight the lions and tigers and “bugs” that come with it. The role of the restaurateur now involves embracing technology while making sure customers don’t feel like they are overwhelmed or inconvenienced. It’s honestly a very tough job – but here are some insights I have gleaned from my years in the business.
Don’t Fear Big Bad Data
Small and medium businesses are increasingly relying on data to better understand their customers. Innovation in data analytics and business intelligence enable businesses to collect more information than ever before about their customers’ preferences and values. But the trick is not in the collecting data – it’s in how you use it.
Take Pizza Hut, for example. In 2013, the international franchise enjoyed a 12x return on ROI thanks to its partnership with customer analytics company Capillary Technologies. Capillary helped capture, structure and leverage large quantities of customer data, but more importantly, they helped Pizza Hut take its massive customer base and segment it based on expressed characteristics, purchase tendencies and behavioral indicators to better engage each consumer.
By implementing data analytics into their everyday marketing endeavors, Pizza Hut has created 6,000+ customer behavioral groups, empowering the brand to predict future purchases and execute campaigns at preferred times via customers’ preferred engagement channels (direct mail, email, text message and more). Investing in such analysis has shown widespread sales growth across its restaurants and delivery business. Pizza Hut has seen a 38 percent improvement in its customer retention rate.
Customers respond well when their favorite eateries take the time to understand their likes and dislikes. And if you’re not in a position to work with an analytics firm or technology provider that includes data analysis as part of their product, there are alternatives. Whether investing in tabletop tablets, ordering kiosks, mobile apps for food ordering, reservations, or waitlist management, or any of the other myriad solutions – always ask vendors to supply the data generated by customers.
There are plenty of online tools you can feed that data into, such MixPanel or Google Analytics, as these tools provide similar insight into your guests’ dining habits and desires. If you want to stay ahead of the curve, it’s time to start exploring your options and turn thoughts of “big bad data” into “big beautiful data” that can help boost your sales.
Stop wishing for a brain – buy one instead
Americans spend thousands of dollars a year eating out: Restaurants account for one of the largest parts of discretionary spending, with sales expected to hit a record $683.4 billion in 2014. It is a fiercely competitive industry, and yet restaurant owners and managers have been remarkably slow to adopt new forms of technology that could make their business more efficient and attuned to the desires of diners. They spend a lot of time fighting trends instead of exploiting them.
Take mobile devices, for example. Every day there is a new story about how people use phones or tablets at restaurants – whether to play games, text with friends or document a meal. Many restaurants bemoan the days of the somber, quiet meal, wringing their hands about how to engage these consumers, or at very least how to get their patrons to put their devices down.
These devices aren’t going away – not if Apple or Google have anything to say about it, anyways. Since your customers are already tapping away on their smartphones, tablets and computers, why not make these technologies an integral part of each patron’s dining experience, and learn a thing or two?
Major food chains have already recognized this potential, with tablets that allow customers to order food, customize their entertainment, and even pay the bill. By implementing this technology, restaurants can use this established behavior in their interactive environment, complete with brand messaging.
For example, Buffalo Wild Wings is bringing Buzztime’s BEOND tablet-based entertainment platform to all of their North America restaurant locations by the end of 2015. The BEOND tablets let Buffalo Wild Wings Guests order food, request songs and television programming, play games (both multi-player and arcade-style), and, pay the bill. Initial research has shown customers arestaying 75 minutes, compared to the industry average of 50 minutes, and they’re returning at least twice a month compared to other restaurants where guests may visit once a month or less.
Other national chains that have embraced tabletop tech have seen similar success. In the past year, Chili’s Grill and Bar installed 7-inch Android Ziosk tablets at all of their locations; the devices,allow patrons to interactively peruse menu items, order beverages and desserts, play games together, share real-time feedback with the brand, and pay the check at the table. In a six-month trial period, Chili’s saw an increase in per-person spend per check, translating to higher income for both the restaurant and wait staff. Servers also reported seeing more tips, as the system increases the spending on their shift.
These results show that tabletop technology can be beneficial to servers, not a replacement for them. Additionally, these types of tablets can make it very easy for people to join loyalty clubs: “We saw improvements in guest satisfaction and engagement from many different touch points within the restaurant, including Chili’s guest feedback surveys and Email Club,” said Wyman Roberts, CEO and president of Brinker International and president of Chili’s Grill & Bar.
Applebee’s has also rolled out 100,000+ E la Carte Presto tablets in its U.S. restaurants, with emphasis on ease of payments. Customers can use the tablets to view menu items, browse and add items to a cart, (a la online shopping), play some games, and pay the bill. Applebee’s has seen similar positive results, as TechCrunch reported in 2013: “(In) a two-year pilot program where Applebee’s tested the tablets across 30 restaurants around the U.S. During these trials, the company found that having tablets available tableside allowed them to reduce the overall table turn time and transaction time for their guests, and guests who were surveyed about the tablets reported a better overall experience.”
While tabletop tablets are the latest innovation, the customer’s own phone remains an incredibly powerful tool. Countless companies can help restaurants harness social activity, monitor online reviews, create lightweight loyalty programs, help customers check out, and even create in-store games (through augmented reality) to make sure that the restaurant becomes part of their mobile experience – and not just a place to fire up a phone and read some blogs.
Technology can make customers and staff feel warm and fuzzy…
Restaurants have been reluctant to jump on the tech-driven dining experience for a number of reasons. Maybe tablet tech isn’t suitable for a fine dining atmosphere, or the futuristic feel clashes with a retro-themed aesthetic. However, the opportunities to implement technology extend beyond consumer-facing, front-of-house operations. They can also streamline food buying, order taking, and even cooking.
“Many brands and operators are thinking even further outside the box, adding innovative technologies in the kitchen and at the front counter,” QSR’s Keith Loria explained in his article ‘Beyond the Tablet. Panera, having invested in kitchen technology with color-coded screens that deliver orders to the kitchen staff, is one example of such outside the box thinking: A red stripe over an ingredient means leave it off, a green stripe indicates an addition. Other colors signify takeout.
Similarly, in an attempt to keep its kitchen staff from having to memorize recipes and food preparation policies, Tex-Mex style fast food chain Taco Bueno added tablets managed by mobile device management company AirWatch to push recipes to its line cooks.
Put simply, if your staff is happy, customers will (usually) be happy too. Kitchen technology like Panera’s and Taco Bueno’s can help cut down on stress and provide happy meals all around. Companies worried about technology pushing humans out of jobs and making employees more stressed out should instead educate their staff about how it is making their jobs easier, letting them focus on being the heart of the dining experience – not just a set of arms and legs rushing from table to table.
It’s not just a dream, Dorothy. This is real.
As the New York Times’ Stephanie Strom put it, “Restaurants have been late to the tech party, and many are now scrambling to incorporate tablets, apps, computerized kitchen equipment and data analysis capabilities.” When proper strategy and implementation applied, technology solves problems that are fundamental to how restaurants operate and compete. And late is a lot better than never. A whopping 51 percent of restaurant operators said they will devote more resources to technology this year alone. As this trend continues to gain momentum, technology will become increasingly critical for any restaurant’s success.
At the rate we’re going, tables and tablets will soon share more than a common etymology – both derived from the Latin “tabula,” meaning plank, tablet, list. One will be incomplete without the other, with technology inextricably linked and indispensable to the casual-dining experience. It may be only a matter of time before your tablet is your table (check out this video of Pizza Hut again pioneering the modern dining experience).
While this may seem like a dream scene from a movie, this type of tech is very real and holds great potential for both businesses and customers in streamlining the dining experience and making it more fun. Now is the time for bar and restaurant owners and managers to research and try new technologies, and make the most of the vast trove of data that falls into their laps every day.