4 Ways to Turn Data into Revenue
Industry sectors like healthcare, finance, banking, and hospitality alike have recognized that big data can become a big game changer. This “monetization of data” trend is now gaining traction in the restaurant industry where operators and franchise executives have stepped up their scrutiny of customer and business data.
While the primary goal of data collection and analysis is to improve the customer experience, other goals include, cost reductions, more targeted marketing, an increase in process efficiency, and getting a leg up on restaurant competition. Achieving any one of these goals can lead to increased revenue. Achieve all five, and restaurant operators can bulk up the slim industry margins to more robust expectations.
Savvy operators understand that restaurant analytics have lasting value. The concept that a company’s data has value to another business is real. However, a restaurant operator need not sell or barter its internal data outside its four walls. What holds most monetary worth is when an operator uses customer and operational data to increase revenue within the business at hand. At that point, the data becomes one of the highest value resources — a strategic business asset.
Turning restaurant data into revenue won’t happen overnight but can flourish with knowledge around the four methods that hospitality businesses are using to mine the data and to increase dollars. The first way to strengthen an operators’ strategic decision-making is with a deeper understanding of operational data, particularly these key types of data:
1 - Optimize Off-Premise Operations
As on-premise dining continues to slide, off-premise dining is taking up the slack and even driving new sales for restaurant operations. Operators who have adjusted their dine-in expectations, embraced off-premise dining, and made operational changes to leverage this new trend, are seeing ways to maximize those sales without impacting their traditional business.
Investing in a kitchen display system can give real-time order status updates that aid both an operator’s delivery partners, as well as its to-go patrons. Providing insights into the actual timing of the food preparations and to-go order packaging creates happier guests and repeat diners, since they receive actual versus arbitrary times. Furnishing real-time data means that the to-go food quality is preserved, which means fewer complaints, fewer comped meals, and an increase in repeat orders and loyal customers.
A good KDS will also have built-in capacity management features and functionality that allow incoming off-premise orders to be throttled or rejected during high-traffic in-house times; this functionality is imperative for preserving the guest experience in the dining room, while also managing expectations for those who order take-out.
With an integration between a KDS and guest management system, FOH staff can be prepared and ready with the right data for off-premise — everything from order and item level statuses to vehicle information; all of this is viewable directly at the host stand or at the curbside pick-up station. Having this readily accessible information creates a seamless off-premise experience and all of this means more revenue for the operator.
One operator that is preparing its operation to capitalize on the prevailing winds of off-premise change is the Saxton Group, which currently owns 80 McAlister units in five states. Recently, the Dallas-based group ordered enhancements to its kitchen display system to access enterprise-level reporting across its entire footprint. The software upgrade now provides quality assurance by enabling the printing of adhesive labels with order items. As off-premise dining has increased, packaging has grown in importance to operators. By having better guest-facing tickets an operation can prevent many possible errors that would decrease profitability.
As a result, this franchisee is finding pennies and fractions of pennies in off-premise dining. By getting real-time operational data with its software upgrade, this group is taking advantage of opportunities that would have been lost, and then is adding those dollars to the bottom line.
2 - Use a Business Intelligence Tool
According to a Reuters 2017 report on the global business intelligence market, that quotes BI market figures from Stratistics Marketing Research Consulting, the BI market is expected to reach $29.48 billion by 2022 with a compound annual growth rate (CAGR) of 11.1%. The report indicates several factors that are fueling such market growth:
· Increasing use of business data analytics
· Penetration of cloud technologies
· Dependency on data for decision making
· Growing adoption by small and medium-sized businesses of business intelligence
However, a treasure trove of data can be overwhelming for businesses, like restaurants that provide a service versus a specific product offering. That’s why most restaurant brands need a comprehensive data acquisition plan, the tools in place to collect that data, and then a business intelligence tool that can provide the sophisticated insight that can drive data decision-making.
For restaurant success, monitoring and analyzing data are paramount. That’s why technology firms like ours and others have placed a priority on launching business intelligence solutions. These BI tools are as important as hiring a top-notch chef, a charming hostess, or a popular bartender. While collecting and compiling the data is the first hurdle, understanding the metrics is what moves a business across the goal line. When an operator truly understands the data, he or she can use those insights to enact changes that improve the bottom line. Those changes may include:
· Identifying FOH and BOH deficiencies that affect the customer experience
· Forecasting customer demand with more predictability
· Better tailoring marketing efforts to drive customer action
Business intelligence tools that facilitate incremental changes to the customer experience and improve forecasting can remove yesterday’s guess work from a simple gut feel. These new tools will allow owners and operators to better quantify the value opportunities for any proposed business changes.
3 - Utilize Guest Surveys
When a business lives or dies by the proliferation or the lack of repeat business, like restaurants do, there’s no better way to foster customer engagement than with guest surveys. Obtaining timely feedback from customers allows restaurant operators to pinpoint improvement areas that have strong correlation with an increase in the bottom line.
These data-driven guest surveys provide a number of benefits to a restaurant operation. Some of those include:
- Quality feedback — When someone from the restaurant’s waitstaff asks a customer about the meal or service, this prompted feedback typically gets skewed in the process. Most people dampen their true feedback so as not to hurt others' feelings. Provide an abbreviated and easy-to-fill-out optional survey and honest feedback is more likely to flow. These more honest assessments of service and food quality can help operators learn more about their business.
- Tracking improvement — If operators want to know how things improve over time, no better way exists than to implement the guest survey and track response data.
- Reduction in negative outside feedback — Service and food complaints can destroy a restaurant business, so offering a timely opportunity for disgruntled customers to vent those complaints through guest surveys provides a valuable benefit. When a business offers a satisfactory and appeasing response, often these negative reviews typically posted on social media can be curtailed.
- New marketing channels — While customer satisfaction surveys have one goal in mind — a happy customer — another benefit may also blossom: a new method of encouraging repeat visits. Those customers who fill out a guest survey can be sent a coupon to entice their return.
With up-to-date satisfaction feedback derived from guest surveys, operators can tweak operational areas for needed improvements and enhance areas where the restaurant soars, thus remaining competitive or besting the local area competition. This honest feedback combined with heightened attention to needed business changes will increase customer satisfaction that can drive revenue to new levels.
4 - Mobilize Kitchen Operational Metrics
Whether running a single-site restaurant or a multi-site chain, having kitchen operational metrics at the fingertips can improve a restaurant’s revenue stream. By using a mobile insights app, an on-the-go operations manager of multi-units can get a quick snapshot of all sites at once and then drill down into an individual site to get a pulse on operations. Likewise, a single-site owner can enable the wearing of multiple hats by using a mobile app to access data and be in more places at one time. Overseeing restaurant performance while on-the-go ensures that crucial decisions are validated by data and made in an expedient way.
Restaurants that are collecting the right data, deriving insights from those metrics, and then implementing improvements based on that valuable data are becoming game-changing companies in their communities, for their industries, and to their customers. Data done right continues to be a win-win-win for all.
About the Author
Amber Mullaney is director of marketing for QSR Automations, which has leading positions in kitchen automation and guest management services. She enjoyed working in the healthcare technology field before transitioning to restaurant technology.
Photo Credit: Austin Distel on Unsplash