RTN Market Watch: Using Data to Build a Transformational CX
Restaurants have embraced digital innovation at warp speed these past few years. Online ordering, loyalty programs, market research and virtually every operational function leaves restaurants with a mountain of data, and oftentimes that data lives in silos. How should restaurants streamline and harness disparate data? HT reached out to two industry insiders to ask for their expertise:
Jessica Bryant, Vice President of Marketing at NCR Corp., a global software and services provider that helps restaurant brands transform, connect and run their technology.
RTN Releases Transactional Data Standard
Restaurant Technology Network (RTN) releases the restaurant industry's first Customer and Transactional Data Standards.
Transactional Data Standard, Phase 1 and Customer Data Record Standard, Phase 2
ADOPTION IS KEY. Join this call on Oct. 18 at 11 a.m. EDT to learn more and access the documentation. Register now here.
and
Tammy Billings, Co-Founder & Head of Industry, Restaurants, at Aben, a customer data platform (CDP) that provides context outside the four walls, recommends quantifiable actions and measures results. Aben is a hot new start-up and was featured at Restaurant Technology Network’s Start-Up Alley at MURTEC 2022.
Using Data to Build a Transformational CX
“There are four key steps to getting to a state of leveraging data in an ideal way to build a transformational customer experience (CX),” explained Bryant. (see sidebar.)
Ultimately, you want to connect and route your data through a single system – for one source of truth, Bryant stressed.
Restaurants lean heavily on their POS systems to collect data. Aben has strong relationships with POS companies and “in partnership with the credit card networks, we are able to marry a company's first-party data with third-party data from the networks. From there, we can uniquely provide measurement of actions taken by the brand that uncover whether they captured share of stomach, share of wallet, impact to frequency & recency,” explained Billings.
Four Steps to Leveraging Data
1. STRATEGY Identify your objectives – and what data you need to support and follow through on these objectives. For example, ask questions such as:
a. Who are my loyal customers? and Who is spending money with my brand?
b. How do I keep my loyal customers coming back and get them to spend more? Remember: It costs 7-8 times less to keep existing customers than to acquire net new customers.
c. How do I get more loyal customers with a lower acquisition cost?
2. DISCOVERY Take the time to access data inventory to help answer these questions. Make sure you have the right data to gather insights in service of the strategic objectives you’re looking to achieve.
a. Look at your physical (e.g. email sign-up sheet) and digital (e.g. ordering, email marketing) data and b. Where does the data live? What technology systems do you have currently in place?
3. DESIGN Create the architecture necessary to get all of these touchpoints to speak to each other. Then leverage the data to turn it into actionable insights.
4. IMPLEMENTATION You can leverage data at every stage of maturity along the way until you get to the perfect state of where you want to be.
a. Test & Learn – Build targeted campaigns based on the data you have today – learn from that to build a deeper understanding of your existing customers.
b. Scale
"No other CDP provider can do that. As attribution data sources wither away - cookies gone, open rates gone - what's left? The one thing that remains consistent is the real sales data of nearby businesses.”
Common Shortcomings in Restaurant Tech Stacks
Most restaurant brands are challenged to uncover meaningful insights from the data they collect, agreed Bryant and Billings. “Gaps in the customer journey and a lack of in-house expertise create situations where data is collected, but not used,” explained Bryant.
With increased pressure to deliver individualized, relevant experiences, Bryant said brands struggle with:
- Identifying consumers across all buying channels and marketing touch points;
- Uncovering critical insights based on all spend and non-spend behaviors; and
- Leveraging strategies, such as marketing automation and segmentation, to act on behaviors and insights.
Billings identifies major shortcomings: POS systems and legacy payment processors that do not share transactional-level data and the age-old problem: budget. “Restaurants operate on razor-thin margins and fail to see that CDP is not a marketing expense but an infrastructure expense. Shifting this mindset should free up capital for true marketing spending,” Billings said.
Removing the Obstacles
Restaurant brands need not only a data strategy but also a consolidated tech platform that enables them to capture and connect disparate data points on individual guests, create personalized experiences and offers, and orchestrate relevant outbound communications that drive incremental changes in guest behavior, advised NCR’s Bryant.
Billings suggested that restaurants take the time to educate themselves: “Take meetings with new vendors, get demos, learn about what's new in the market.”
Restaurants should implement a CDP as part of an infrastructure play across the organization. Consider hiring more folks from outside the industry; they likely have had exposure to different vendor sets, and at minimum can push your vendors to do more. Measure what matters: no action should be taken without intent to measure, and then measure the true impact of your marketing, advised Billings.
Q4 and Beyond
“One of the biggest challenges we see facing our customers is menu pricing and maintenance,” adds Bryant. ”We are excited about the industry adopting dynamic pricing powered by AI and machine learning,as we’ve seen take hold in other industries, like travel and hotels,” explained Bryant.
Billings is bullish about the real-world impact of AI chatbots and voice ordering. “It's a real technology that uses AI to impact both the top and the bottom line; it's not a fad.”
- How One Restaurant Chain Harvests Actionable Data
With Aben, “what we know with precision is how well we are doing inside our four walls at a brand- and location-level,” said a restaurant CIO in an exclusive HT interview. A current user of Aben, he oversees a full-service restaurant chain with more than 100+ locations nationwide.
“What we do know from industry sources (self-reported and unaudited) is how well our named peer group is doing at a brand level but NOT location. The named peer group is only 30% of where people choose to dine. We are blind to where else they dine and how much they spend there,” he said.
In the past, his company has obtained restaurant market data, which he described as “incomplete” and “lacking specificity such as location data.”
Aben’s tool is offering operators high quality, actionable data that helps restaurant CIOs target new diners from local markets. “These guests are buying next to our location, but have never interacted with us. How do we do that? We can do that with Aben,” said the restaurant CIO.
Aben is also helping the CIO and his team:
- Make determinations on the performance of individual locations. “We can tell how well we are doing, but how do we know what the gap is between us and the local market on share of dining spend? Aben solved it for us,” the CIO said.
- Monitor ‘Blind’ customers’ lifecycles. “We can only watch customer lifecycle journeys on the 10-30 percent [of customers] that engage in a loyalty program. We are blind to the rest. Yes, credit card tokens exist, but the datasets and capabilities needed are bigger than a database but way smaller than a Salesforce. Every tech nerd on both sides of the table tosses the term ‘customer data platform’ as some panacea. That’s cute, but just the first of many steps before value. Without automated identification and processing of campaigns, then it’s as good as a dusty Excel file on a shared drive,” the CIO explained.