Customer experience | KRG Hospitality

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October 14, 2022by David Klemt David Klemt No Comments

Restaurant Rewards Making Headlines

Restaurant Rewards Making Headlines

by David Klemt

Loyalty programs are making waves and grabbing headlines but not all of the news is good, according to consumers.

Dunkin’, Chipotle, Taco Bell, and Starbucks are among the restaurants whose programs are receiving attention.

Now, there are still those who cling to the idea that all publicity is good. Personally, I’ve found that idiom to be outdated. In fact, I’ve believed that phrase to be false for several years.

Instead, when it comes to publicity, I find this quote from Warren Buffet to be far more accurate: “It takes 20 years to build a reputation and five minutes to ruin it.”

It’s important for operators—for all entrepreneurs, really—to protect their brand’s reputation. At the end of the day, long-term success depends on the reputation one builds. And make no mistake, that reputation is made—or broken—every day, with every interaction.

So, what does all of that have to do with loyalty or rewards programs? It’s simple—such programs aren’t just about revenue. A loyalty program, when executed well, is a branding tool that boosts engagement, recognition, and perception.

When a loyalty or rewards program is executed poorly it doesn’t just mean low membership numbers. A brand’s reputation can take a severe hit if loyal consumers cry foul.

Let’s take a look at some brands that have made headlines the past couple of weeks.

Taco Bell

This rewards program, the Taco Lover’s Pass, is a bit of an anomaly in the loyalty space.

It was first launched in Arizona in September 2021. Depending on the location, the pass cost either $5 or $10. In exchange, people could get a free taco a day for 30 consecutive days, and they could choose from seven tacos.

Back in January of this year, Taco Bell brought back the Taco Lover’s Pass. This time, the program was available throughout the US, and it cost $10. Again, those who snagged a pass through the chain’s app could get a free taco each day for 30 consecutive days.

And just two weeks ago, Taco Bell made the Taco Lover’s Pass available again. This time, people had one day to download the app (if they didn’t have it already) and grab the pass.

Time will tell if Taco Bell will eventually make this wildly popular program permanent. For now, this occasional reward program seems to be serving the chain just fine, and their loyal guests don’t seem to be angry that the Taco Lover’s Pass, thus far, appears fleetingly.

Starbucks

Another interesting approach to loyalty sees Starbucks partnering with Delta Airlines.

As of yesterday, members of Starbucks Rewards and Delta SkyMiles can link the programs together. Members of the former can receive double stars on days on which they’re flying Delta (at participating locations). For the latter, members will earn one mile for every dollar they spend at Starbucks.

Essentially, linking the two accounts ensures that members earn points across both programs for a single purchase. Not a bad move—it should be an effective way to boost loyalty for both companies.

Chipotle

Ah, Chipotle. It’s safe to say this brand has experienced plenty of ups and downs over the past several years.

But credit where credit is due: It seems that the chain manages to come back from each scandal or mistake. And that’s what’s so frustrating—they wouldn’t have to correct missteps if they took care to avoid making them in the first place.

So, why are people upset with Chipotle now? The backlash concerns the restaurant chain’s Chipotle Rewards program.

When someone signs up the program, they can redeem a nice perk immediately: free chips and guacamole. On their birthday, they have access to another perk. In general, the biggest benefit is earning up to 10 points for every dollar spent at Chipotle.

The points a member earns are redeemable in multiple ways: free menu items, a charitable donation, or merchandise. Seems very straightforward, right?

Well, Chipotle updated their rewards program, and it’s not an upgrade. In response to inflation, Chipotle has increased prices, just as innumerable restaurants have also done.

However, the chain updated Chipotle Rewards so that members must spend more to get their free entree reward. Members must now spend an additional $20-plus to get their reward, and they’re understandably unhappy.

It should go without saying but a rewards program is for increasing visits or orders per member. With people declaring they’re “done” with Chipotle, the brand’s update is driving down visits and potentially harming their reputation.

Dunkin’

Things in the reward and reputation space may be worse for Dunkin’ than any other restaurant brand at the moment.

The chain first launched its DD Perks loyalty program eight years ago. Last week, Dunkin’ “reworked” loyalty, launching Dunkin’ Rewards.

Unfortunately, according to several reports, social media, and Reddit, the new program deflated the value of members’ points. From what I’ve seen members must now earn more than double the points they needed to prior to the Dunkin’ Rewards rollout for a gratis beverage.

Oh, and free drinks on a member’s birthday? The new program eliminates that perk. As is often the case on social media, some people are seething.

However, a statement from Scott Murphy, the president of Dunkin’, suggests that people are perhaps misunderstanding or misrepresenting the new program.

“Dunkin’ loyalists told us they wanted the ability to redeem for more than just beverages and we listened,” Murphy said to The Washington Post. “They also wanted to bundle points for larger orders, which we accomplished. And they told us they wanted to be recognized for their loyalty, which they can now achieve through Boosted Status and earn points even faster when they come to Dunkin’ more often.”

In short, Dunkin’ Rewards is built to allow members to redeem points for a wider array of menu items, including meals. For now, however, it seems the knee-jerk reaction is that many members feel the points they earned prior to the new program’s launch are devalued. And they’re furious, with some calling for a boycott.

Obviously, a boycott is the opposite effect one wants from their loyalty program.

Loyalty is a Tightrope Act

If there’s one takeaway here, it’s that rewarding guests for their loyalty isn’t as simple as offering points for dollars.

Perhaps it should be simple, and maybe it was was that simple a while back. But now, operators must be far more cautious when designing a loyalty program.

I’ll continue to dislike offering discounts for most brands. In my opinion, once a guest becomes accustomed to receiving a discount regularly, that discount becomes the standard price. That’s not good for most operators.

It may seem counterintuitive, but I’d rather see loyalty program members receive a free item than discounts. At least they’ve paid full price to earn that perk.

Another issue, however, is making changes to loyalty programs. Operators are facing incredible strain when it comes to costs, and this industry’s margins are already razor thin. It appears that some brands aren’t just increasing costs, they’re also increasing the points it takes to earn loyalty perks.

That may make sense on paper but program members are showing that they don’t take kindly to this type of change.

Slow Down

Look at loyalty programs through the eyes of consumers, not just the eyes of an accountant.

When the costs of living rise and a person’s dollars don’t go as far as they did before, they tend to cut back or eliminate expenditures. Commonly, restaurant visits are among the first things suffer. Loyalty programs can offer guests a way to stretch their dollars—there’s an attractive perk around the bend that allows them to justify continual visits.

If a brand devalues a loyalty program member’s points or requires them to spend more to earn the same benefits, why would they be happy? Why would they remain loyalty? As far as they’re concerned, their incentive to do so no longer exists. The perceived value is no longer there.

Before an operator launches or “revisits” a loyalty program, they need to slow down and analyze it from every angle. These programs are a delicate balancing act, demanding they make sense for both the bottom line and the guests.

If an operator hasn’t yet implemented a loyalty program, perhaps they should hold off until costs become more reasonable. With inflation affecting costs and therefore prices, the wisest move may be to take the time to really dial in the program, prepare the necessary assets, and implement when it won’t impact revenue negatively.

On the flip side, operators considering making significant changes to their loyalty programs need to take the time to strategize before implementation. A misstep, even if it’s a misunderstanding from the member side, can do irreparable harm.

Image: Isabella and Zsa Fischer on Unsplash

July 8, 2022by David Klemt David Klemt No Comments

Hotels, Guest Data and Guest Expectations

Hotels, Guest Data and Guest Expectations: A Chat with SevenRooms

We sit down with Austen Asadorian, vice president of sales at SevenRooms, to chat about pent-up demand for travel.

People are eager to get back out there and hotels, of course, play a crucial role in their travel plans. However, we’re not engaging with the same guests we were pre-pandemic.

No, today’s guest demands more from the hotels and resorts they select. And a key to delivering on guest demands is collecting guest data.

But while operators know they’re supposed to be collecting guest data, there’s some uncertainty about what to actually do with it. Enter: SevenRooms.

More accurately, meet Austen Asadorian of SevenRooms. Not only can he address meeting guest demands through tech, he can address how to use guest data responsibly and effectively.

Hi Austen, thank you for taking the time to speak with us. Can you tell us a little about yourself and your role at SevenRooms?

Thanks, David! My name is Austen Asadorian and I’m the Vice President of Sales at SevenRooms. I first started my career in hospitality early in high school, getting a job at a local restaurant in New Jersey, learning everything from protein fabrication to catering and dealing with daily customers, even managing events. I continued working in hospitality through college, while going to the Culinary Institute of America for a degree in hospitality management, and ultimately, landed at Hillstone Restaurant Group where I ran back of house operations as well as the company’s Manager Training Program. Before joining SevenRooms, I worked as Peloton’s Director of Sales, leading their go-to-market strategy for retail growth and expansion from 2014-2017.

Today, I support SevenRooms’ global expansion efforts to accelerate our goal of being the best-in-class solution for hospitality operators around the world. Having previous experience in the hospitality industry, I joined SevenRooms because I was hyper aware of the pain points in the industry surrounding technology and the need for better guest management after having lived it day-to-day for several years. More importantly, I believe in SevenRooms’ vision and have a true passion for helping hospitality businesses, big and small, drive revenue, and create loyal guests for life.

Let’s talk hotels. What does the hotel industry look like two years after (or into) the Coronavirus pandemic?

When the pandemic struck, travel came to a complete halt and hotel occupancy in the US fell from 70% in March 2019 to less than 25% in March 2020—rooms were empty. Now, as the world is back to what we can consider a new “normal,” we’re seeing an extreme surge in travel and hotels are busier than ever.

However, what guests expect from hotels experience-wise has changed and they demand more. They’re making up for lost time and they want to make it count. Coming out of the pandemic, hotel operators are taking a harder look at their entire tech stack. It’s no longer optional to have a tech stack that is fully integrated from top to bottom across their operations—it’s a must-have—and technology providers are adapting to meet those needs. Additionally, operators have put a strong emphasis on the importance of ownership over their guest data. Both trends have positioned SevenRooms incredibly well within the hotel sector, as this has been our business philosophy from day one.

How can hotel operators and managers live up to these high expectations?

The simple answer is by taking advantage of technology solutions into their everyday practices and processes. These tech solutions can be anything from a QR code for mobile order and pay, allowing guests to order food and drink from anywhere on the property without ever needing a server to approach them, to an integrated customer relationship management (CRM) platform that speaks to and pulls data from their F&B CRM, easily sharing that information across teams at the hotel. For example, passing information along to a guest services team to ensure that in-room amenities don’t include nuts if a guest has a peanut allergy.

Operators and managers should also make sure they’re utilizing loyalty programs. According to a recent SevenRooms survey of American consumers, 44% say that loyalty programs play a part in their hotel choice and there are certain incentives that will bring them back.

For example, some want loyalty points to enjoy on property restaurants and bars, whereas others want a personal greeting when they check in, or a complimentary glass of champagne waiting for them when they get to their room.

Technology and loyalty programs both play into an exceptional experience and it’s important for operators to use both to create the total package.

You mentioned collecting guest data. Can you tell us a little bit more about why that is so important?

When we talk about data and hotels, we’re talking about using it to power a one-of-a-kind unique experience. We don’t mean taking or selling personal information, and that’s an important distinction.

The data we’re collecting for operators centers around a guest’s profile—who they are and what they like. This can be anything from their dietary preferences to their favorite table in the hotel restaurant’s dining room, to what dessert they order most often when they visit.

By having this data, operators can build a direct relationship with these guests and, in turn, build an incredible experience that keeps them coming back. For example, if a guest stays at a specific hotel on their vacation and takes full advantage of the pool cabanas, the data collected on those visits can then be used to retarget them with a special marketing promotion or offer to visit their local hotel property for a staycation, complete with a discount on a cabana day rental.

Creating these unique, personalized experiences not only increases revenue for operators, but also drives loyalty, as a loyal guest is more important than a one-time guest.

About Austen

Austen Asadorian is the Vice President of Sales at SevenRooms, where he is tasked with supporting SevenRooms’ global expansion efforts and accelerating the company’s goal of being the best-in-class solution for hospitality operators globally. Prior to joining SevenRooms, Austen was Peloton’s Director of Sales, leading the company’s go-to-market strategy for retail growth and expansion. He started his career at Hillstone Restaurant Group where he cut his teeth learning how to run efficient and profitable restaurants at scale. Austen was ultimately promoted into an executive role where he oversaw the company’s Manager in Training Program and Back of House Operations. Austen graduated from the Culinary Institute of America (CIA).

Image: Antonio Janeski

May 24, 2022by David Klemt David Klemt No Comments

Alright, Seriously—WTF, Grubhub?

Alright, Seriously—WTF, Grubhub?

by David Klemt

Or, more to the point, stop working with “partners” who exploit our industry rather than support it.

In spectacular and entirely predictable fashion, Grubhub’s “free lunch” further reveals that third-party delivery platforms don’t care about restaurants.

Of course, they all say they support restaurant owners and operators. And, of course, they’re quick to pat themselves on their backs for being a pandemic lifeline.

But…no. Time and time again, mainly through their exorbitant and exploitative fees, they prove the opposite is true.

Restaurants and bars aren’t third-party delivery partners. Rather, these relationships are adversarial and detrimental. So much so, in fact, that some states passed laws to limit third-party delivery fees.

In Nevada, for example, Clark County Commissioners passed an emergency ordinance in August 2020 capping those fees at 15 percent. Clearly, we need to stop enriching companies that prove they don’t support the hospitality industry but cause it significant harm.

Free Lunch?

They say there’s no such thing as a free lunch. Apparently, Grubhub really wants to prove that maxim true.

That’s one of the takeaways from their disastrous promotion. Last Tuesday, in what’s being reported as an attempt to claim the delivery throne in New York City, Grubhub offered “free” lunch to anyone who placed an order for delivery.

The requirements for this promotion? Place an order for delivery through Grubhub on May 17 between 11:00 AM and 2:00 PM and use the code “freelunch.”

Of course, customer orders weren’t entirely free. Rather, the code was good for a $15 discount. Still, a wildly attractive offer as the ensuing debacle reveals.

Unsurprisingly, the promotion made for some eye-grabbing and eye-rolling headlines. Buzzfeed News published the most attention-grabbing one: “GrubHub Was Getting 6000 Orders A Minute During Its Promo Today That Left Restaurant Workers Stressed And Customers Hangry.”

Six thousand orders per minute during a promotion with a three-hour window in a single market.

In addition, the outlet reported that one unsatisfied customer was number 3,630 in the Grubhub customer service queue. Apparently—and who can blame him—he hung up before he could speak with a Grubhub rep about his missing order.

Duh

Who could’ve seen this coming? Any of the restaurant owners, operators, or team members Grubhub “serves,” that’s who.

In fact, anyone who works in this industry with on-premise experience knew this was going to happen. So, too, any journalist who specializes in hospitality.

The fact that whoever came up with this promotion didn’t see this coming is revealing. Unless the creators of these apps and services have real-world restaurant experience, they don’t understand the business.

How can one effectively and properly serve an industry without an understanding of how it operates? Hospitality is about service. Shouldn’t the companies attempting to work within our industry work hard to serve alongside us?

Let’s be clear—this promotion was in no way designed to help struggling restaurants. It wasn’t intended to boost their traffic and revenue. Rather, it was solely created to serve Grubhub’s desire to be number one.

As we all know, we’re experiencing major staff shortages. There are also supply shortages making it difficult for operators to obtain product reliably. Grubhub made those problems exponentially worse.

Some restaurants stopped taking delivery orders. Others canceled orders. There were operators who closed in an effort to catch up with orders and prevent the situation from worsening.

According to news stories, some social media users posted that they planned to stop ordering through third-party platforms.

Negative Impact

If you’re new to KRG Hospitality, welcome. You’re likely realizing that we’re not fans of third-party delivery.

Those of you who are familiar with us have known for quite some time that we support direct delivery. That is, delivery controlled and executed by the restaurant itself.

It’s not that we’re against innovation. Rather, our dislike of these platforms, generally speaking, comes from our perception of their behavior.

In our opinion, they take control away from operators and cost them money. Again, speaking generally, they collect customer data that operators should control. Their fees are ridiculous in most cases. And when it comes to the customer experience, their inconsistencies and shortcomings reflect poorly on the operators far too often.

Studies show that customers who have issues with third-party deliveries often place the blame on the restaurant. Food the wrong temperature? Order arrive late? Packages in less-than-ideal condition? While those issues and others can be the fault of the driver, the restaurant often takes the brunt of a customer’s dissatisfaction.

Of course, there’s also the financial impact of third-party delivery on restaurants. A SevenRooms report from last year reveals how these platforms harm operators and their bottom lines.

The Solution

Look, we know operators have a ton on their plates. But protecting and boosting the bottom line is a non-negotiable element of this business.

Yes, it’ll take some time, effort, and money to set up direct delivery. However, it’s the best solution.

Direct delivery means the operator collects and control valuable data. Likewise, the operator can ensure consistency. Through direct delivery, the operator shapes and controls the experience.

Control. Inherently, third-party delivery takes some control away from operators. That’s not a good thing, and neither is their financial impact.

Look into setting up direct delivery, take control, and protect your revenue ASAP. Friend of KRG “Rev” Ciancio and SevenRooms CEO Joel Montaniel each address delivery on the Bar Hacks podcast. Listen to episode 13 with Rev and episode 24 with Joel to learn more about delivery.

We need to stop rewarding companies that exploit our industry and take advantage of our owners, operators, and hard-working staff members.

Direct delivery is the answer. Take steps to implement it today.

Image: Rosie Kerr on Unsplash

Blurry image of people in a nightclub or bar

May 9, 2022by David Klemt David Klemt No Comments

Designing with Anxiety in Mind

Designing with Anxiety in Mind

by David Klemt

Interior design has the power to remove a person’s anxiety, improving the guest experience by making them feel more comfortable.

Lionel Ohayon, founder and CEO of ICRAVE, addressed design and anxiety at HD Expo 2022 in Las Vegas. While anxiety wasn’t the entire focus of this intimate discussion, what Ohayon had to say was powerful.

When some operators consider their space, they probably aren’t thinking about guest anxiety. Ohayon, who designs with compassion and empathy in mind, believes designers can address anxiety through the design process.

Why the respected designer think designers can accomplish this feat? He does it himself.

Innovative Design

For the benefit of those unfamiliar with Ohayon and ICRAVE, some background.

Specializing in interiors and lighting, ICRAVE is an award-winning design firm. Founded by Ohayon, the firm’s approach to design includes a focus on the experiential and the client’s brand strategy.

One may assume that ICRAVE works solely in the hospitality space. To that point, the firm’s portfolio includes some of the world’s most impressive restaurants, bars, lounges, nightclubs, hotels, and spas.

However, the company is well known for work in the healthcare, wellness, entertainment, residential, workplace, mixed-use, and airport spaces.

After two decades, ICRAVE has honed their vision, approach, and strategy. A key pillar is “experience design.” In fact, the firm believes that “the experience is the brand.”

It would be impossible to live and deliver on that core tenet without understanding a client’s business. For ICRAVE, the final product must engage all those who use the space they’ve designed and their client is operating.

Reducing Anxiety

Consider this scenario. It’s not one that we’ve all found ourselves in. However, it is a situation that those who experience anxiety live with every day.

Let’s say someone has agreed to meet friends at a nightclub. They’re not meeting somewhere outside of the club so they can enter as a group.

This person arrives, enters, and is seeking out their friends. Unfortunately for them and their anxiety, they’re the first to get there. Anxiety (and even panic) sets in. Now, the last place this guest wants to be is in this nightclub.

Obviously, this is a terrible guest experience. And now this guest may associate the venue, fairly or not, with feelings of anxiety. They may never want to return.

Throughout Ohayon’s career, he has designed for this exact situation. During his HD Expo session—which was much more an intimate conversation inside the DesignWell Pavilion—Ohayon explained that he has incorporated “perches” in a number of his designs.

A perch, in this context, is a space a person can access that makes them feel comfortable while they wait for others in their party to arrive. The way I understand it, a perch is like a “hideaway,” a space someone feeling anxiety in public can use so they don’t feel like everyone’s eyes—and judgment—are upon them.

Designing and planning for longevity requires designers and their clients to think differently. Health and wellness must be more than buzzwords—they must be authentic to a brand.

Anything less is disingenuous. Today’s consumer is perceptive when it comes to sensing the inauthentic, and they don’t like it.

Takeaway

Now, some operators may feel as though addressing a guest’s anxiety isn’t their problem. And we’re not always sensitive to the fact that someone is feeling anxious.

Some people may even feel defensive about their venue right now. Their space, they may be thinking, isn’t causing anyone anxiety.

At risk of putting too fine a point on it or stating the obvious, a key element of hospitality is guest comfort. If a guest’s comfort and sense of safety isn’t important to someone, they really shouldn’t be in hospitality.

To clarify, Ohayon’s comments on anxiety are first and foremost for designers. He wants designers to consider how they can incorporate elements that may help reduce a person’s anxiety.

On the client side, though, an operator can and should ask about such elements during the design process of their space. There’s no reason to be defensive—this is about mindfulness, wellness, and compassion.

Removing anxiety through design pays off during day-to-day operations. If a space can reduce a guest’s anxiety, that guest can be present and engaged. That engagement leads to a positive, memorable experience. And that type of experience evolves into repeat visits from loyal guests.

Image: Maurício Mascaro

April 26, 2022by David Klemt David Klemt No Comments

Forward Progress: 2022 Drink Trends

Forward Progress: 2022 Drink Trends

by David Klemt

Curious about what drink trends to leverage throughout 2022 to fulfill guest desires and expectations? Datassential has answers.

Of course, nobody has a crystal ball. However, as their name suggests, Datassential has something similar: data.

A trove of their valuable data was shared during Bar & Restaurant Expo 2022. Amanda Torgerson, senior account manager at Datassential, revealed the trends operators should be aware of this year.

Datassential MegaTrends

During this informative session, Torgerson shared what Datassential has identified as three “megatrends.” In other words, two trends that are particularly noteworthy.

First up, self-service. Whether beer, wine, or cocktails, Datassential thinks today’s guest wants more control.

Self-service beverage alcohol taps offer control in multiple ways, pour size and customization among them.

In addition, guests don’t have to wait for servers or bartenders when serving themselves. And, of course, self-service cuts down on front-of-house labor costs.

Second, experiential imbibing. In this context, this doesn’t simply relate to occasion, service, location, and ambiance.

Rather, the drink itself is an experience. Experiential cocktails engage multiple senses and include:

color-changing cocktails (those using butterfly pea powder, for example);
cocktail carts (similar to tableside guacamole preparations, tableside cocktail prep and service);
fire and smoke: smoked, charred, and burnt cocktails;
drinks that invoke nostalgia and guests’ childhoods;
frozen drinks; and
beer, wine, spirit, and cocktail flights.

Finally, botanicals. As we know, scent is a crucial component of taste. Botanicals, obviously, activate one’s olfactory sense.

Additionally, botanicals can affect a drink’s appearance and taste. So, break out the Chartreuse, Lillet, and elderflower liqueurs.

And while your team is at it, consider how else scent can be used to entice guests and enhance the drinking experience.

Best of the Rest

Treating this as more of a speed round, let’s review Datassential’s trend predictions in four major categories.

Seltzer/Beer

When it comes to hard seltzer, Datassential has (re)confirmed what we all know: This category has staying power. And as many operators found out during the pandemic, seltzers can boost to-go and delivery sales.

Beer cocktails are also trending up, per Datassential. Mini-bottles of beer also having a moment, and can easily tie into the beer cocktail trend.

Finally, heirloom beers—those made with heirloom grains—are proving popular with consumers.

Wine

According to Torgerson, wine seltzer is poised for a moment. Relating it to the hard seltzer trend, consider this Wine Cooler 2.0, as Torgerson said.

Other key wine trends are frizzante and red sparkling wines, orange wines, and canned sake.

Then there’s fruit wines, which means any wine not made from grapes. During her session, Torgerson suggested using these in cocktails.

Cocktail

In addition to cocktails on tap, Datassential sees the following as cocktail trends to watch:

Drinks made with genever.
Hybrid rums, blends of light and dark rums.
Ranch Water (typically a highball made with tequila and lime juice, topped with Topo Chico).
Single-serve, premade cocktails such as RTDs. These are great for off-premise sales.
Boozy frozen desserts.

Global

Focusing first on increasingly popular spirits, Datassential’s data shows that pisco, mezcal, and Japanese whisky are trending up.

In terms of wine, operators should look into regions that are perhaps “lesser known” in North America. Some examples from Torgerson’s presentation are Georgian and Hungarian wines.

And finally, what Datassential identifies as “drinking for a cause.” Such causes and beverage activations can be local or global as the world is so much more connected.

Image: ABHISHEK HAJARE on Unsplash

April 19, 2022by David Klemt David Klemt No Comments

Dining Room Tech on the Rise

Dining Room Tech on the Rise

by David Klemt

After years of restaurant technology adoption moving at a glacial pace, the industry now appears to be embracing innovations at light speed.

In fact, in just two short years some in the industry think it may be time to slow down. New tech can be exciting but jumping on every “innovation” is expensive, time consuming, and inefficient.

However, slowing down doesn’t equate to hitting the pause button.

Dining room tech was a topic of discussion at the 2022 Restaurant Leadership Conference in Scottsdale, Arizona. The two speakers agree that our industry needs to ease off the tech throttle a bit.

However, they also feel that tech innovations in the restaurant space will continue at a faster rate than they did pre-pandemic.

Session host Raymond Howard, a co-founder of Ziosk, interviewed Chris DeFrain and Hernan Mujica about dining room tech. DeFrain is a CPA at Lehigh Valley Restaurant Group, which operators 21 Red Robin franchises throughout Pennsylvania. Mujica is CIO for Texas Roadhouse.

Red Robin

Industry professionals and consumers alike should be familiar with Ziosk. After all, Red Robin has been a client with tech company since August, 2012.

Anyone who has visited a Red Robin has certainly interacted with a Ziosk terminal.

According to DeFrain, there are some interesting consumer behaviors taking place in Red Robin dining rooms. When it comes to tech, guests appear satisfied to place orders for appetizers and desserts via Ziosk terminals.

As DeFrain sees it, the guest would rather not wait for a server for ordering those types of food items. However, guests do seem to prefer ordering entrees from a server.

That’s a positive in DeFrain’s opinion, as he believes that ordering must remain the domain of servers. While he contends that the tech-based ordering process needs streamlining, DeFrain doesn’t appear interested in taking it out of servers’ hands completely.

This makes sense; the server as an integral element of the guest experience. How can a casual dining restaurant build guest loyalty and deliver a memorable guest experience without an engaging front-of-house team?

Of course, dining room tech should do more than accept orders, summon a server, and offer tableside payments. Today, data is king. Powerful platforms collect as much useful data as possible.

To that end, DeFrain appreciates that Ziosk provides data Red Robin leadership teams can share with staff. For example, a server can be shown how much they’re making in tips during their shift.

Finally, DeFrain says that guest usage of Ziosk terminals is improving feedback and comments.

Texas Roadhouse

In comparison to Red Robin, Texas Roadhouse took longer to sign on with Ziosk. In part, interestingly, this was due to the redesign of the terminal itself.

Turns out, Texas Roadhouse waited for a Ziosk terminal that took up less space and looked better on the chain’s tables.

Per Mujica (and any Texas Roadhouse guest), the in-person experience is core to the brand. Therefore, dining room tech must be an enhancement, not a detriment.

Like Red Robin, the chain has no interest in adopting tech that replaces FoH staff.

Another consideration regarding dining room tech should be important to all operators: The tech must be user friendly. According to Mujica, restaurant guests are happy to embrace tech innovations—if it’s easy to use.

So, operators must be careful and deliberate when choosing their tech stack. Generally speaking, native tech users (Gen Z) will likely be much quicker to learn how to use a particular technology than a Baby Boomer or even Gen X counterpart.

As such, operators must know their guests in order to adopt tech that enhances rather than alienates.

Another reason Texas Roadhouse chose Ziosk, per Mujica, comes down to mobile pay. In short, the chain didn’t like the mobile pay guest experience.

In terms of the future, Mujica predicts that handheld, tableside ordering is the future of dining room tech.

Takeaway

Like Mujica says, operators have now seen what tech innovations can do for them. In short, there’s no turning back.

And I agree with Mujica and DeFrain: it’s likely (and necessary) that tech development will slow a bit moving forward. Honestly, we all need room to breathe, consider the innovations available currently, and decide what works best for a particular business.

Likewise, I agree that tech can’t be allowed to alter the service model. Technology shouldn’t be seen as a replacement for staff.

Interestingly, restaurateur David Chang addressed this very subject during a 2022 RLC conversation. In his opinion, tech won’t replace restaurant roles, it will streamline them. At most, said Chang, tech will replace small, repetitive tasks, such as the physical flipping of a burger.

In closing, when deciding on the tech stack, operators should consider the following: ease of use for guests, ease of use for staff, streamlining of operations, and cost.

In this space, tech should never be embraced simply because it’s shiny and new. Not only is that costly in terms of investment, it can cost guest loyalty and visit frequency.

Image: Vishnu Mohanan on Unsplash

A shot of tequila served with salt shaker and lime wedge

February 16, 2022by David Klemt David Klemt No Comments

Yes, Some Tequilas Have Additives

Yes, Some Tequilas Have Additives

by David Klemt

The subject of additives in tequila—and lack of transparency on labels—isn’t new but recent social media posts are shining a light on the topic.

In particular, there are posts circulating about tequila producers using vanilla flavoring. Doing so, it turns out, is well within the Norma Oficial Mexicana (NOM) rules.

However, revealing it on labels? With some caveats, it’s also well within the rules not to mention additives.

Understandably, people want to know what they’re putting in their bodies. Increasingly, this has grown to include alcohol.

So, there are bar owners, bar managers, bartenders, and bar guests who want to avoid serving and consuming additives whenever possible. Of course, there are also guests out there who don’t care about additives in the spirits they drink.

Interestingly, though, there’s a collective of tequila distilleries committed to producing clean spirits. They have no interest in using additives.

Chris Wirth alludes to these producers on episode 66 of the Bar Hacks podcast. He and wife Camila Soriano produce world-first clean tequila seltzer Volley.

Are There Additives in Tequila?

First, let’s be clear: Several categories of spirit permit the use of additives. Labeling transparency falls under the jurisdiction of different governing bodies.

So, it’s not like the use of additives is a scandal or exclusive to tequila. And, again, some consumers and hospitality professionals care, some don’t.

Additives become a problem when producers who use additives choose language on their labels and in marketing that suggest otherwise.

You see, tequila producers aren’t required to include additives on their labels if they don’t exceed one percent of total volume. NOM permits the use of glycerin, caramel coloring, “sugar-based” syrups, and oak extract in all tequilas except blanco.

However, there appears to be a loophole in NOM rules showing the use of additives in blancos is indeed permitted.

For those who don’t want to consume tequilas that use additives, brands that claim to be additive-free in their labeling and marketing present a problem. That’s because at best they’re just following the rules, but at worst they’re using the rules to be deceptive.

Why Does this Matter?

According to some in the industry, tequila may just kick vodka off its throne this year. In America, anyway.

Undeniably, that indicates increased consumer focus on tequila. It follows that a number of restaurant, bar, and nightclub guests will come across the topic of additives.

Some will want to know which brands are additive-free. This is where this topic should matter to operators and their bar teams: Guests don’t want to hear, “I don’t know.”

Luckily, there’s a resource out there that will help: Tequila Matchmaker. Hit that link, click the “Types” tab, and select “– Additive Free” from the dropdown.

As of this writing, you’ll find 266 bottles of additive-free tequila. Some of the brands you’ll find on this page are Código 1530, Tanteo, Fortaleza, El Tesoro, ArteNOM, Tears of Llorona, and Patrón.

Once more, this isn’t a scandal. Rather, this is an opportunity for operators to ensure they have some tequilas on their menu that are additive-free.

It’s likely the topic will come up and being prepared with a few recommendations will improve the guest experience.

Image: Francisco Galarza on Unsplash

Delivery or takeout food order in brown paper bag

February 7, 2022by David Klemt David Klemt No Comments

What Consumers Expect from Delivery

What Consumers Expect from Delivery

by David Klemt

Consumers are developing specific behaviors and opinions regarding delivery that impact their perception of restaurants and brands.

Over the course of two years and three surveys, Deloitte has attempted to learn more about consumers and delivery.

In total, Deloitte surveyed 1,550 restaurant customers. Additionally, the multinational interviewed highly positioned executives from ten casual, fast-casual, and QSR brands.

What Consumers Want

First, it should come as no surprise that delivery is here to stay. None of Deloitte’s survey results indicate otherwise.

In fact, it appears that some consumers are showing an interest in additional delivery methods. Half of survey respondents are willing to try driverless or drone delivery.

More than half—64 percent—don’t expect to return to pre-pandemic dining habits by March of this year. Illustrating the habit of ordering takeout and delivery, 61 percent of respondents engage with restaurants that way at least once per week. That represents a 32-percent increase from June 2020 to September 2021.

When dining off-premise, 57 percent of Deloitte survey respondents prefer to place orders via an app. However, 40 percent of respondents prefer a restaurant’s own branded website or app. That shows that:

A restaurant’s website matters. A significant percentage of consumers want to get information, get a feel for a restaurant, and place orders with a business directly.
Direct delivery is feasible. Consumers want to know and feel as though they’re supporting a restaurant directly rather than a third-party business.

Own the Delivery Experience

Of course, quality is a concern with consumers who place delivery orders. This points to another pitfall regarding third-party delivery beyond the fees.

Unfair as it is, three out of five restaurant customer survey respondents have quality expectations. Specifically, they expect the same food experience off-premise as they receive on-premise. That means the same quality and the same freshness.

They also indicate that wait times of up to 30 minutes are acceptable. Here’s where the risk to restaurants comes into play. Consumers will fault the restaurant for late orders; cold food (or melted or room-temperature food for cold items); iced drinks becoming watered down; and other order issues even if they’re delivered by third-party services.

So, operators must look into and invest into what they can to improve the quality of delivery orders. Containers that keep hot food hot, French fries and other fried foods crisp, and cold foods cold are paramount.

Unfortunately, problems that occur after an order has left a restaurant—which are out of the business’ hands—are often attributed to the venue. Another reason, then, to consider and implement direct delivery.

Image: Yu Hosoi on Unsplash

December 17, 2021by David Klemt David Klemt No Comments

What Does Omni-channel Mean?

What Does Omni-channel Mean in Hospitality?

by David Klemt

Buzzword or professional jargon, the term “omni-channel” seems to come up more often as our industry embraces more innovations.

As more social and digital platforms (channels) pop up, your job as marketer becomes more complex.

For a pessimistic take, your marketing efforts are like a ship. Every new marketing channel that gains traction is like a hole you have to plug. Fail to do so and you risk your marketing ship sinking.

Now for an optimistic take. Every channel you can add to your marketing is an opportunity to grow your reach. Increasing the amount of people who become familiar with your brand represents the potential to grow loyalty and sales.

If you want to meet your guests where they are—and you should—you need to have a presence where they are to engage with them.

And that’s just marketing. There are also omni-channel operational tactics you can implement. Unsurprisingly, you’ll likely realize many of those solutions are also digital.

So, what does “omni-channel” mean for operators? It means offering seamless guest experiences pre-, per- and post-visit.

Staying top of mind is also an element of an omni-channel strategy.

Traditional Channels

In terms of marketing, let’s break down the different types of channels available to operators.

A simple way to look at “traditional” marketing channels is that they don’t leverage digital mediums:

Newspaper and magazine ads
Radio and television ads
Direct mail
Billboards
Vehicle wraps
Flyers

Now, some of the above may seem outdated. However, those channels still have reach.

The key is knowing your brand and audience to know if a traditional channel will deliver an ROI. You also need to take the time to figure out where your dollars and time are best spent.

Digital Channels

So, there’s a reason I put the word traditional in quotation marks in the previous section.

There may be a time when digital channels become so ubiquitous that they’re considered traditional.

Just look at the digital channels below and consider how commonplace they’ve become:

Social media
Email marketing
Company websites
Search engine marketing
Newsletters
Text messages

It’s easy to see how one day the channels above will overtake their non-digital counterparts and become the traditional way we market.

The reasons for this are obvious. Digital campaigns are easily measurable, they allow for incredibly specific targeting, and they tend to be more engaging.

Really, the biggest cons that pertain to digital marketing channels are: being viewed as annoying/intrusive; being lost in the sea of ads people encounter every day.

On the execution side, it can still be overwhelming to engage just in social media marketing. However, there are platforms that can help make this task less daunting.

Other Channels

Like I wrote earlier, omni-channel doesn’t only pertain to marketing.

Of course, the term and practice are most often associated with marketing. However, operators have more to think about to truly become omni-channel.

The way your guests interact with your restaurant are also channels. Your front-of-house staff is a channel, technically speaking.

Now, we all know that the pandemic forced operational changes. Many of those changes are here to stay.

So, let’s look at a potential guest journey:

The potential guest receives a promotional offer via email.
They follow the link to an online reservation platform.
After arriving at the restaurant with their party, they check in with the host in person.
The server greets the party, some of whom request a physical menu. Others in the party pull out their phones and access the menu via QR code.
Throughout the meal, the server touches the table to ensure the visit is going well, refill drinks, take additional drink orders, etc.
When it’s time to pay, the party quietly does so via a touchless option and leaves.
A follow-up email is sent for feedback.
After a number of days, a text message is sent out to encourage another visit.

The marketing channels are just one element that makes the hypothetical restaurant an omni-channel operation. Providing digital, touchless menu access and payment are also omni-channel elements.

Those are just a few examples. If you take the time to review your operations; where you can reach new and repeat guests; threats such as third-party delivery; and innovations you can implement, you’ll see where you can make changes to become an omni-channel restaurant.

Image: Dan Gold on Unsplash

Black glass Coca-Cola bottle with black background

November 16, 2021by David Klemt David Klemt No Comments

Stir Up This Authentic Mexican Cocktail

Stir Up This Authentic Mexican Cocktail

by David Klemt

A simple, three-ingredient cocktail can make a big impact on guests when it’s authentic and the build is part of the presentation.

A perfect example of authenticity and a wow-factor cocktail build is the Batanga.

During episode 57 of Bar Hacks, Collin De Laval recommends this deceptively simple drink.

La Batanga

When De Laval is creating, it’s important to him that he remains faithful to a particular country, region or town.

As the company mixologist for Código 1530, that means honoring tequila in an authentic way.

Not only is De Laval a “blanco drinker, through and through,” he’s also unafraid of things getting “rowdy.”

So, while he isn’t the creator of the Batanga, he is a big fan.

One reason, as he mentions on Bar Hacks, is that the drink seems like it shouldn’t work. After all, the recipe combines tequila blanco, lime juice, and Coca-Cola.

Now, one could say that this is “just” a Cuba Libre with tequila stepping in for rum. However, that’s far too dismissive; the flavor profiles are vastly different.

In fact, I’m fairly certain that nobody has raised an eyebrow at a Cuba Libre and said the ingredients shouldn’t work together.

Impactful Build

You may find yourself wondering how this simple cocktail can possibly wow guests. Really, what’s impressive about combining tequila, juice and cola, and stirring?

Well, it’s the stirring that’s the secret.

Per several sources, the Batanga’s creator had a trick up his sleeve when he came up with the recipe. And that trick was a big knife with a wood handle.

Don Javier Delgado Corona created the Batanga in 1961 at La Capilla, his bar in Tequila, Mexico. When it came time to finish his build, he stirred the drink with the aforementioned wood-handled knife.

Even better, Don Javier is reported to have explained, if that knife has been used to cut limes, salsa ingredients, or ingredients for guacamole.

I’m going to go out on a limb here and assume that unless they’ve had a Batanga made in Mexico, not many guests have watched a bartender stir their drink with a big knife.

Of course, not just any knife will have real impact, so I recommend using the biggest knife your highball or specialty glassware will accommodate.

The Recipe and Technique

Obviously, you can decide which of your tequilas to use when adding the Batanga to your menu.

Of course, you can also build it with whatever tequila your guest requests.

However, we’re going to use Código 1530 tequila for this recipe. After all, the brand certainly speaks to authenticity.

Additionally, Código 1530 also speaks to consumer desire to drink better and seek out ultra-premium spirits. Tequila is one of the luxury spirits categories benefitting most from this consumer trend, with sales volume increasing 30.7 percent annually since 2015.

La Batanga

Recipe created by Don Javier Delgado Corona at La Capilla

2 oz. Código 1530 Blanco
0.5 oz. Fresh-squeezed lime juice
Coca-Cola to top (per De Laval, only Mexican Coke in the glass bottle will do)
Salt for rim

Salt rim of highball glass or other tall glassware with decent width. Add ice to glass. Combine Código 1530 Blanco and lime juice. Top with cola. Most importantly, stir with a big knife and serve to wowed guest.

Image: Jeanson Wong on Unsplash