Upgrades | KRG Hospitality

SevenRooms Drops Extensive 2024 Report

by David Klemt

Today, we’re taking a look at the first-annual trends report from marketing and operations platform SevenRooms, which focuses on the guest experience.

To gain an understanding of the current state of affairs in America, SevenRooms analyzed the product data of more than 3,000 US clients. Further, the platform engaged over 250 operators, and 1,000 consumers.

The result is a data-rich report that offers helpful insights for operators.

Two findings are particularly interesting to me, and the team here at KRG Hospitality. One, it appears that Americans are back to seeking out their third spots. As a refresher, a third spot, space, or place is where one spends time when away from home or work. Consumers tend to be loyal to these places, making them part of their everyday or weekend routine.

Two, younger consumers are leading the way in terms of restaurant visits. Per SevenRooms, 38 percent of Millennials visit restaurants five or more times per month. Gen Z is also visiting restaurants frequently, with 24 percent visiting five times or more. However, that number climbs to 45 percent for Gen Z when it comes to three or four monthly visits. Among Millennials, 33 percent visit restaurants three or four times per month.

That tells us that younger consumers are eager to socialize, and restaurants can fulfill that desire. As savvy operators know, a person can eat or drink at home; food and beverages are just excuses to get out, hang out, and meet new people.

This also tells us that operators need to ensure they’re ticking several boxes to resonate with younger guests: value, convenience, and personalization. I’ll add that consumers have shown they want to support brands with values that align with their own.

There are many more insights in SevenRooms’ new report, which you can find below. To view the report in its entirety, click here.

SEVENROOMS RELEASES 2024 RESTAURANT TRENDS AND DINER EXPECTATIONS REPORT FOR THE HOSPITALITY INDUSTRY

Annual report gives an inside look at how restaurants are delivering better guest experiences and personalizing their marketing in the age of AI and automation

NEW YORK (August 6, 2024) – SevenRooms, the leading CRM, marketing and operations platform for growing restaurants, today released its first annual trends report, “2024 Restaurant Trends and Diner Expectations,“ highlighting how restaurants are filling the need for ‘third places’, connection spots outside the home and workplace, what consumers expect from their dining experiences, and how restaurants are leveraging AI and automation to keep diners coming back.

The study, commissioned through independent third-party research firm Censuswide, examines consumer and foodservice operator insights, alongside data from SevenRooms restaurant customers. It emphasizes the importance of restaurants understanding their guests and providing experiences and value to consumers, including marketing and tech trends that operators are paying attention to.

Diners Expect More From Restaurants

While it’s no surprise that diner expectations have evolved in recent years, consumers across generations and cities share key expectations when dining out — they’re looking for convenience, personalization and value from brands they trust. Restaurants must nail all aspects of the guest experience, from hospitality and service to ambiance and atmosphere, to transform diners into brand ambassadors and get them to bring their dollars back more often.

When looking across generations, Millennials are driving a dining resurgence – dining out most frequently with 38% saying they dine out more than 5x a month. They are seeking more from their restaurant visits, and are willing to spend more for elevated experiences, like theatrical elements or high-end items like caviar. For these experiences, Americans are willing to spend up to $63 per person with 45% of Gen Zers open to paying even more. As diners focus on the quality over quantity of their experiences, that means restaurants must do more to keep those diner dollars. Dining upgrades consumers are willing to spend more fall into three categories – experiential, luxurious and personal, including:

Experiential (e.g. tableside martini cart; fish presentation or deboning, etc.)
○ Dallas – a menu item with some theater (86%)
○ Washington DC – a menu item with some theater (71%)
Personal (e.g. birthday dessert; welcome drink)
○ Chicago – a mocktail or personalized item (55%)
Luxurious (e.g. caviar, freshly shaved truffles, seafood tower)
○ Los Angeles – high-end items like caviar (55%)
○ New York – high-end items like caviar (48%)

Outside of these experiential offerings, restaurants must also capitalize on influential factors that bring diners back. For example, 34% of Gen Zers want personalized surprises in service like a free dessert. Meanwhile, 26% of Millennials care about the ease of making a reservation and 24% of Gen Xers consider the rapport they develop with front-of-house staff. Tailoring guest experience and service helps operators turn one-time diners into loyal customers.

“New consumer demands are pushing restaurants to find the right balance between hospitality and automation to create the experiences guests crave and return for,” said Joel Montaniel, CEO & Co-Founder at SevenRooms. “Diners want both access and recognition when spending their hard-earned dollars, and restaurants must embrace new strategies – and technologies like AI and automation – to enhance hospitality at every touch point. Whether leveraging platform data to personalize diner experiences or power marketing and retention programs, technology and data serve as a vehicle to execute hospitality that guests remember and return for. When technology is used effectively, it allows operators to focus on building deeper connections and delighting guests, one experience at a time.”

Loyalty is Never One-Size-Fits-All

In the U.S., there was a 21% year-over-year increase in reservations comparing Q1 2023 to Q1 2024 and restaurants are looking to a promising future. Whether operators are focused on opening new locations or revamping their social media marketing efforts, one factor remains the same – establishing personal relationships with diners is the strongest way to build and maintain loyal customers.

Consumers have a strong intent to dine with their favorite brands. If a guest can’t get a reservation at their preferred restaurant, 39% of guests look for a sister restaurant to dine at, and 27% check other sites for the same restaurant.

Cultivating loyalty is critical. Loyalty is not a one-size-fits-all effort and diners have different interests when it comes to the benefits they seek out from loyalty programs. Restaurants need to understand their diner demographics to curate operations and offerings, getting their guests to not only return more often but spend more in the process.

38% of diners who would spend $89-$126 on an average night are looking for exclusive VIP events, while 33% of consumers who dine out 7-8 times per month want VIP access to specialty seating areas. Breaking down generational differences:

72% of Gen Zers care most about free menu items
30% of Millennials care most about VIP access to specialty dining areas
1 in 5 Gen Xers and Baby Boomers want early access to reservations

Genuine, Tailored Marketing is Critical to Success

When it comes to marketing, authenticity and personalization reign supreme for consumers. Guests want to be known by their favorite restaurants, and restaurants want to know and understand their guests. To reach these consumers, and serve up personalized marketing that makes guests want to return, restaurants have to use all the tools in their arsenal – from social media to email and text marketing automation – to create high-touch communications that are both authentic and personal.

79% of restaurant operators spend the majority of their marketing budget on social media. Their top social media goals are to drive bookings or online orders (39%), increase brand awareness (29%) and communicate with their audiences (29%). But not all content is created equal – 39% of operators say that organic posts drive the most bookings to their restaurants. Restaurants that showcase their personality – highlighting their team, food and drinks and atmosphere – will win with consumers as they look for more genuine content from brands.

Most diners like hearing about restaurant promotions and offers via email and text, and aren’t as interested in social media DMs or phone calls, but specific preferences vary by generation. 41% of Gen Zers prefer text marketing, whereas 38% of Millennials and 37% of Gen X prefer email marketing.

With targeted Email Marketing, the data report notes that operators see 23% higher open rates and 28% higher click-to-open rates, generating 2x more revenue per email. Text marketing is fairly new for restaurants, but has huge potential, with an average open rate of 98% and $1.64 average reservation revenue generated per text message on SevenRooms. For one SevenRooms customer, Fabio Viviani Hospitality, it drove $220,000 in revenue and 3,000 new guests in just 4 months.

“The biggest thing that excites me about text messaging is that it’s very hard to ignore. When our phones beep, we are just driven to look at them,” said Harry Kaminski, CMO at Fabio Viviani Hospitality. “It’s easier to ignore an email than it is a text.”

Artificial Intelligence (AI) Comes into Play

Every industry today is using AI and automation in some way to streamline their operations and help staff work more efficiently – and the same is true for the restaurant industry. 70% of operators surveyed said they use artificial intelligence in some way to run their business, including:

35% – Processing reservations
34% – Inventory management
33% – Data analytics
27% – Scheduling
26% – Dynamic pricing

But there is room to grow with AI, with only 16% saying they use it to create marketing collateral and 15% for staff hiring and training. With personalized marketing a large focus for operators in 2024 and beyond, as well as hiring and retaining staff to deliver on high-touch hospitality, operators have an opportunity to use AI more effectively.

“AI elevates our storytelling around data,” said Kelly MacPherson, Chief Supply Chain and Technology Officer at Union Square Hospitality Group. “We have a wealth of data at our fingertips, but this can create analysis paralysis. With AI, we can more efficiently synthesize the data, create stories about what’s happening, why it’s happening, and what we can do about it, and then present these stories to our teams in a digestible format with actionable next steps.”

For more information about SevenRooms and to download the full report, please visit here.

About SevenRooms

SevenRooms is a CRM, marketing and operations platform for growing restaurants in the hospitality industry. From Michelin star gems to local favorites, the all-in-one platform helps restaurants increase sales, delight guests, and keep them coming back, automatically. The full suite of products includes reservations, waitlist and table management, review aggregation, referrals, email marketing, and marketing automation. Founded in 2011 and venture-backed by Amazon, Comcast Ventures and PSG, SevenRooms has more than 10,000 dining, hotel F&B, nightlife and entertainment clients globally, including: Marriott International, MGM Resorts International, Mandarin Oriental Hotel Group, Wynn Resorts, Jumeirah Group, Hard Rock Hotels & Resorts, Wolfgang Puck, Michael Mina, Bloomin’ Brands, Union Square Hospitality Group, Australian Venue Co., Maple & Ash, The Wolseley Hospitality Group, Dishoom, Groot Hospitality, MLSE, Live Nation and Topgolf.

Research Methodology

SevenRooms partnered with Censuswide Research – a third-party, professional research and consulting organization. Total sample size was 1,004 U.S. consumers. Fieldwork was undertaken between March 4-11, 2024. The survey was carried out online. The figures have been weighted and are representative of all U.S. adults (aged 16+).

SevenRooms partnered with Censuswide Research – a third-party, professional research and consulting organization. Total sample size was 251 U.S. operators (hospitality decision-makers). Fieldwork was undertaken between March 4-19, 2024. The survey was carried out online. The figures have been weighted and are representative of U.S. hospitality operators.

SevenRooms provided anonymized internal data representative of U.S.-based restaurants using the SevenRooms platform and surveyed a sample of operators at various restaurant sizes and types across the U.S. from March-May 2024.

Image: kayleigh harrington on Unsplash

3 Ways Restaurants Can Build Revenue This Mother’s Day

by Austen Asadorian

With Mother’s Day quickly approaching, there’s no doubt that operators across the country are preparing for the celebratory—yet extremely busy—day.

During their preparations, it’s important that operators find and incorporate new tools and innovative marketing tactics. Doing so will not only fill seats, it will ensure they capitalize on a key opportunity to drive incredible revenue.

Below are three simple but powerful ways operators can generate revenue and loyalty on—and beyond—this Mother’s Day.

Encourage Reservations & Offer Upgrades

An easy way to make this busy day seamless for guests—and, ultimately, staff—is to encourage and allow guests to make a reservation before they arrive. Reservations give operators insight into who will be dining with them, help optimize seatings and covers, and provide a idea of how much to order to eliminate food waste if a special menu is being offered.

Using a reservation system also provides operators with the opportunity to offer diners upgrades during the booking process, even including prepayment should they want to go that route. This not only allows operators to earn additional revenue before a guest even visits, but also a convenient way to offer guests peace of mind knowing they’ve handled that “something special” for Mom way before the big day.

These upgrades don’t have to be anything crazy or extreme (although that’s always an option). In fact, according to the National Restaurant Association, consumers want special touches and discounts over everything else. So, an upgrade can be something as simple as a beautiful flower arrangement waiting on the table to a special off-menu dessert brought out at the end of the meal.

Use Email & Social Media to Your Advantage

Properly promoting Mother’s Day offerings to guests is extremely important because if no one knows about it, who will come?

Operators should utilize tools like email marketing to send personalized communications to their guest database promoting the venue’s Mother’s Day reservation availability or special offerings. Better yet, these tools can be used to offer loyal guests reservations before they open to the general public, further creating a special experience for those faithful diners.

In the same vein, operators should harness the power of social media, too. Operators can target paid marketing efforts on social channels like Facebook and Instagram to drive even more awareness and revenue for their restaurant by creating an event, including the details of the activities, specials, or Mother’s Day promotions, and exporting the names of top guests and email data.

Surprise Them with a Second Visit

While Mother’s Day is the focus right now, it doesn’t stop there for operators. To drive the revenue they need, it’s important to turn these celebratory diners into repeat guests.

To do so, operators should consider offering Mother’s Day diners complimentary gift cards or discounts (even via email post-visit) to bring them back. This could be for an upcoming graduation, Father’s Day (so Dad can also get the love), or even for a future birthday.

This “surprise and delight” factor is one of the easiest strategies to capitalize on holiday traffic and get diners to return to a restaurant once again as a loyal guests.

Here’s to You, Mom

Moms should be celebrated every day, but especially on Mother’s Day, and it’s important to make sure they have the best experience when dining out.

By incorporating simple tactics like offering reservations and custom upgrades or even a special surprise at the end of the meal, operators not only succeed in making the day memorable, but create a guest who will return over and over again.

About Austen Asadorian

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: grumpymonstergroup via Vecteezy.com