Customer EngagementRestaurant Technology

3 Restaurant Tech Resolutions for 2019

A sound restaurant tech strategy comes down to focusing on the customer.

Happy New Year! We’re back to see what’s in store for restaurant tech in 2019. Last year saw tech adoption in the industry go mainstream, with major players signing delivery partnerships, real-world changes to better accommodate the impact of tech, the full blown escalation of the delivery wars, and larger brands finally jumping on the mobile bandwagon via loyalty programs.

Here are our 3 New Year’s Resolutions for operators as they think about restaurant tech in 2019.

Resolution #1: Own the customer relationship + focus on data

Thanks to the growth of digital ordering, customers have seemingly endless choices. Brands must meet them on their terms, and aim to engage, delight, and retain whenever possible.

The best way to navigate this dynamic is to own the customer relationship, and the data behind it. We at Bikky call this “sweetgreen-ing it.” It means understanding exactly who your customers are at the deepest levels, and leveraging that information to inform everything from menu planning, to in-store layouts, to content marketing. For sweetgreen, owning the customer relationship is their superpower, informing every facet of how they run the business. And it’s all powered by data.

Sweetgreen’s app is the center of the digital strategy – with every feature engineered to maximize data collection and customer understanding.

It sounds intimidating, but there’s a good chance you already have some this information lurking in your existing systems. The six key variables we analyze at Bikky to understand a restaurant’s customer base looks like are:

  • Loyalty / lifetime value (how long they’ve been spending)
  • Frequency (how often are they spending)
  • Channel / in-store or delivery (how are they spending)
  • Order history (hat are they spending it on)
  • Location (where are they spending)
  • Day-part (when are they spending)

In aggregate, these data points paint a picture of your distinct customers and how they impact your business. Owning the customer relationship – and a data-minded approach – are the foundation for unlocking these insights.

Resolution #2: Understand the role – and nuances – of third-party delivery

Online ordering and delivery are here to stay, with the market expected to grow at ~4x the industry at-large. Mega brands like McDonald’s and Wendy’s have both touted the early benefits, namely higher ticket sizes and overall incremental business (i.e. new customers that previously wouldn’t have come in-store).

This revenue bump is certainly welcome, especially as the industry grapples with rising labor pressures (via minimum wage) in 2019. However, the cost is two-fold, as restaurants forfeit both margin and ownership of the customer relationship.

As analysts observe, the data from these orders belongs strictly to the third-parties; they use it to better understand and engage customers, keeping them loyal to their service over the restaurant brand (the exception: Yum! Brands, who’s $200 million investment in Grubhub bought them access to the data).

2018 was the year that third-party delivery went officially mainstream

Of course, you can’t ignore delivery outright. You need to be where customers are, and give them every opportunity to engage with your brand. Instead, counter third-party reliance and launch your own first-party platform.

Thought of in a traditional marketing context, third-party platforms are the ideal “top of funnel” / lead generation tool. They give you a digital presence on a platform with a large reach, while you pay a cost for traffic sent your way. It’s a great way to make people aware of your brand and help them gauge the quality of your food and service.

Augmenting this with a first-party platform gives your brand an opportunity to convert these diners to a much more data-rich channel. By investing sufficient time and resources, you can make it an effective way to retain customers.

Resolution #3: Get organized with a CRM

Part of owning the customer relationship comes down to being organized. A CRM (like Bikky’s!) unlocks data across your different systems (POS, delivery, loyalty), providing a unified view of your customers. A complete picture of your diners – who they are, what they like, when and where they order – is the starting point for leveraging your customer data.

At Bikky, we help restaurants use this data to better engage their customers. Instead of a blanket offer to all lapsed diners, what if you could target lapsed vegetarians with an exclusive offer at their favorite location? Instead of offering a discount to customers in your loyalty program (btw why are you offering discounts to your most loyal diners?), what if you could increase order frequency by letting them know exactly how many points they need to earn a free reward?

A CRM helps you dig deeper into specific diner behavior, and a tool like Bikky’s helps you uncover the exact trends influencing your business. At Bikky, we leverage this data to better segment and target diners, improving conversions on marketing campaigns by 2x.

Overall, we know resolutions can be hard to keep (my new diet ended yesterday). So even if you’re not quite ready for a CRM, or haven’t mapped out your delivery strategy just yet, know that succeeding in both these aspects stems from owning the customer relationship. It’s much harder to go wrong if you keep your customers at the heart of your restaurant tech strategy.

As always, I’d love to hear from you – send me your thoughts at abhinav@bikky.com.

Happy New Year!