The role of data in rebuilding the restaurant industry

Rebounding from the pandemic requires patience – and the ability to harness the valuable information you glean from every interaction with your customers

By Sean Keith

As the restaurants that have managed to stay afloat over the last quarter begin to reopen across Canada, many won’t resemble their former selves. Forced to become grocery purveyors and retool their menus and operations for delivery and takeout, restaurant industry’s battle for survival is now entering its second phase.

From capacity slashed to less than 50 per cent (or even more), to seating areas kitted out with tents, table dividers, and glass greenhouses to adhere to social-distancing rules, dining in and out has changed almost overnight. Canadians are conflicted about it, too.

A survey released in early June by researcher Angus Reid reveals that 52 per cent of Canadians intend to avoid dining in restaurants for a while. The good news is that still leaves 48 per cent of consumers willing to resume in-venue dining, regardless of how different the experience will be.

Of course, this could all change again if there’s a second wave. Talking with restaurants here in Canada and also in the U.K., the uncertainty of not knowing what’s next is challenging every operator. This issue applies as much to evolving regulations around social distancing, as it does for how consumer appetites for eating in or out will evolve in the coming months.

Short term gain, long term pain

Since the start of the crisis, thousands of restaurants have turned to Uber Eats, DoorDash, and SkipTheDishes as an immediate way to get in front of homebound consumers and keep their businesses running. But it’s a double-edged sword. Hefty fees, inconsistent or poor customer service, and “wholesaling” their customers is forcing operators to rethink their reliance on food delivery apps.

It’s also causing businesses to recognize the value of owning the customer relationship. Every digital interaction on a mobile device or online, like searching for locations, menus, and delivery options, or even calling to place an order, gives restaurateurs another glimpse into who their customers are and what they are looking to buy. Such opportunities are entirely lost if restaurants outsource those direct customer connections to food delivery companies.

Reclaiming customer relationships

It’s an incredibly harsh climate to operate in, and it will become even harder without profitable customers. It’s one thing to keep kitchens open, but not at the expense of losing money with each order.

So, how do businesses reduce their reliance on food delivery apps? National initiatives are helping educate consumers about the importance of ordering directly from restaurants. But restaurants also need digital tools to support online orders and grow those digitally enabled, direct relationships with their customers.

Getting to know who your customers are is part of this transition. You might already have a mailing list, and you’ve sent email campaigns in the past. But do you know each customer – their preferences, order frequency, promotions they’ve responded to, and what menu items they’re likely to order in the future? This isn’t having data for data’s sake; it’s vital information needed to optimize and drive footfall, frequency, and higher-value sales per customer whether they’re on or offline.

Future dining experience will be driven by data

While dine-in service remains off the cards for some Canadians, converting new online delivery customers with promotions specifically designed to drive future traffic and in-venue sales should be a priority. But that’s not possible without a digital platform – or the customer data and insights it generates. By understanding who are your best online delivery customers, what they like, and where they’re located, you can not only look to find more like them, but also develop promotions to incentivize specific behaviors at certain times and days.

These could include incentives that encourage curbside pickup, factoring in whether items will travel well and be presentable and hot on arrival, and what packaging is needed. For many restaurant operations, this could be a totally new focus. But thinking about order preparation and fulfillment in this context is also part of the future dining experience.

Dialing up digital engagement

Attracting undecided diners is part of restaurants’ survival. As consumers become more comfortable eating out over time, they’ll also have more options. That’s where digital engagement can help operators focus on competitive differentiators related to the quality, service, and selection of their in-venue options.

Frequency and speed may be less important for some operations, especially where a central urban venue’s location may attract more passing than regular trade. Those with more regular, local trade should also use personalization to encourage frequency.

For example, when a customer opts in to receive promotions, you could send offers when they’re passing a venue, using geolocated notifications to deliver time-limited deals and special menu items. You could even tailor an offer to the time of day (breakfast, brunch, lunch, or dinner) or specific events (such as Canada Day).

There are even ways to use a direct customer channel to implement social distancing rules more efficiently. One of the proposals for full-service Canadian restaurants is mandatory reservations to manage capacity and avoid queues. That could include notifying pre-booked customers when their table is ready and offer contactless payment options at the table. When consumers will be struggling to adjust to a new way of living in and out of the home, these types of experiences can go a long way in building loyalty.

With millions of consumers relying on digital, mobile, and social channels more than ever, the ability to communicate where customers are and to create marketing that feels relevant to each diner is what will be expected from restaurants, large or small, post-crisis. And that approach, called D.I.A.L. (data, leading to insight, driving action to promote loyalty) has accelerated in recent months and is here to stay.

Just look at how Starbucks is pivoting its operations to rely even more heavily on mobile engagement with customers. While this might not be viable for every restaurant, it reinforces the need for operators to have a direct, digital connection with their customers.

While we don’t know exactly how long the crisis and its after effects will linger, the importance of building and nurturing consumer relationships can provide a lifeline for operators.

Your restaurant’s future depends on it.

Sean Keith is the director of new business development at Eagle Eye, a leading SaaS technology company that enables businesses to create real-time connections with their customers through digital and mobile promotion solutions. Recognized by the World Economic Forum as a Global Shaper, Sean helps brands in the retail, food and beverage, and hospitality industries implement digital transformation initiatives to better understand customer behaviours and drive revenue growth among Canadian businesses.

One thought on “The role of data in rebuilding the restaurant industry

  1. I completely agree that the future of the restaurant industry is digital. From engaging and creating relationships in the digital space to contact less dining, your insights could not be more true. I have experienced that creating more personalized experiences with my customers has really helped my bottom line. Keep sharing such articles in the future.

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