Artificial intelligence (AI) might still sound a little futuristic — or like technology that mainly large national brands can harness at this stage. But the next decade should be eye-opening: By 2030, almost 70 percent of businesses will use some form of AI in their operation, according to McKinsey research. Restaurants that readily understand how to adopt it and where it can provide the greatest value should be able to gain a competitive advantage. Restaurant Nuts suggests two areas that are ripe for AI adoption in restaurants of any size: improving sourcing and translating reams of data into sales. For example, when you consider your inventory, how accurate are you able to be about the items you will need? Do you rely on last year’s data mixed with some guesswork? AI can use predictive analytics that incorporate historical data from a range of relevant periods, along with weather, holidays and other factors that can impact demand, to help eliminate the trial and error that can waste money. Further, even if you have a POS system that gathers thousands of data points about your guests, that data is only useful to you if you’re able to analyze it quickly and apply it to strategies that will keep guests happy and returning. AI can help operators by collecting a wide range of data about everything from sales to purchasing, then assessing it against current consumer trends. As a result, you’ll be able to make decisions in real time, not weeks or months behind schedule. Forbes reports that the hospitality technology company Fourth, which supports such brands as TGI Friday’s, Eataly, Bar Louie and Dairy Queen, among others, is one that has expanded into AI recently. Other reports indicate that McDonald’s uses AI to find diverse employee candidates. Look for more restaurant technology systems to start to integrate AI functionality into their software.
Blockchain technology has been slow to take off in the restaurant industry. But the launch of a new credit card currently accepted by Palo Alto, Calif. merchants and restaurants could help restaurants see the tangible benefits. Restaurant Dive reports that Yosemite X, a technology company that developed a public blockchain platform, has just launched Yosemite Card, a 0 percent transaction fee credit card that is expected to save businesses 2-3 percent on transaction costs annually. It generates a random PIN every 30 seconds, which could provide protection against data breaches, and it can also integrate with a restaurant’s existing systems to offer a rewards program. The technology could still be a ways off from being widespread in the industry, but applications like this could well provide telling data points about how blockchain can help restaurants improve margins, as well as manage and protect their data.
If your restaurant has a salad bar, buffet or other self-service food station, pay attention to temperature and cross-contamination risks. Hot foods should be at least 135˚F and cold foods should be 41˚F or cooler — and check those temperatures regularly. Statefoodsafety.com advises operators to clean and sanitize food thermometers between uses with other foods so germs or allergens don’t spread from one food to the next.
An apron can tell a story about a kitchen worker’s day, picking up traces of food but also dirt and bacteria. ServSafe advises you make sure your staff know to wear aprons when preparing food and removing them when they use the restroom or when they take out garbage. Have a convenient place to store aprons so your staff can access them easily between tasks.
Who needs meat? As menus become more plant-focused, chefs are taking cues from meat preparation so consumers are less likely to miss the carnivorous experience. Datassential points out that one trend to watch in the coming months is that cooking and preparation methods once reserved for meat are making the leap to produce. (Coffee rubs, once in the purview of barbecue, are now being used on root vegetables like beets.)
Rising labor costs are forcing all restaurant operators to make tough decisions about how to manage staff and how to prepare the food they serve. But what happens when the decisions you have to make are central to the brand identity your guests associate with you? Case in point: Chop’t. The fast-casual chain is known for chopping salad in front of the customer, a practice that provides some visual intrigue while sending the message to guests that their food is freshly prepared according to their tastes. But the company announced recently that it would be making the switch to pre-chopped ingredients. (Guests can still have their salad chopped but have to request the service.) Darren Tristano of FoodserviceResults predicts that regular guests could be turned off by these changes — in the short term — but will probably forgive the changes and return to old habits eventually. Just the same, if you’re experiencing a similar need to cut back on services that are central to your brand and important to your best guests, what can you do? A well-executed loyalty program may help you bridge the gap. Chipotle, for example, recently unveiled a new digital loyalty program designed to both give guests what they want and continue to collect customer data that will help the brand feed future decisions that will keep guests engaged. Skift Table reports that the new loyalty program, which was market tested for months, awards guests with free chips and guacamole after one purchase. Each $10 purchase earns guests one point and after $125 spent, guests earn a free entrée. These enticements are encouraging more visitors to sign up for the loyalty program — and share their data in the process. From there, Chipotle can study what factors bring those guests back and make them spend more money, whether it’s discounts on certain items or special promotions. What can you do to keep your guests coming back?
A growing number of fast-casual restaurants are becoming less about having guests stay and eat and more about letting them pick up food to go or have it delivered. Eatsa, the fast casual bowl concept that pioneered the idea of automating food to go, is now focusing on helping many of these fast casuals launch virtual restaurants, which can help brands test potential concepts or service models with minimal investment. The Spoon reports that Eatsa’s new tech offering, dubbed Omnichannel Intelligent Queue Software, can calculate the exact status of an order, send customers a down-to-the-minute update, and alert delivery drivers about the exact time to pick up an order so it doesn’t wait for long. When a driver arrives, a branded pickup station directs the person to the specific order that needs to go. (Deliveroo is the first customer to put the new Eatsa tech into practice at its 10-kitchen food hall in Singapore.)
A Harvard Business School study found that by increasing customer retention rates by just 5 percent, profits will climb anywhere between 25 and 95 percent. It pays to identify your regulars and find ways to keep them coming back. Katrina Kutchinsky of KK Communications, a public relations and social media agency focused on the hospitality industry, told OpenTable she recommends restaurants focus on offering added value over any type of discount. So once you have regulars who have already joined your email list and your loyalty program and you’d like to go the extra mile to take care of them, taking after-dinner drinks or dessert off their bill may go further than offering them 10 percent off their next visit. (This also makes your specific experience harder for competitors to copy.) There are other ways to build value into the experience you offer too. Offering free samples of a new appetizer, a bookshelf of donated books or games accessible to guests waiting for food, tableside entertainment, live music offered by musicians from a local college, or small gifts for children and for special occasions like birthdays and holidays can all communicate value as well. You don’t even have to spend money to generate value: Create memorable ways to involve guests in your decision-making, like asking them to vote on a variety of dishes you’re considering adding to the menu. Or simply be present. Having your manager make a brief stop at a table to ask for feedback or help with a concern, or to invite guests to take a post-meal survey or join your loyalty program — can go far in helping you demonstrate that you care about guest preferences.
Hospitality Technology’s 2018 Restaurant Technology Study found that 45 percent of operators said they planned to increase their spending on back-of-house software — up from 25 percent the year before. The key factors driving that spending were the need to provide better service, manage rising labor costs and consolidate disconnected technology tools used within their business. Nation’s Restaurant News reports that Arby’s Restaurant Group has been rolling out technology that has been addressing those specific pain points. They installed mobile app-connected HVAC systems that can generate monthly usage reports, as well as automated cook and hold ovens, Bluetooth-connected ovens that “can sense when the roast beef is perfectly cooked,” and hardware that can make it possible for traditional kitchen equipment to send time, temperature and cooking data to the cloud. Peter Cryan, senior director of equipment innovation at Arby’s parent company, said the savings have been dramatic. The cook and hold ovens alone have saved the restaurants 67 percent in energy each year, two hours of daily labor related to checking manual processes, and $45 million in energy costs since the changes began in 2011. Cryan said the tech platform more than paid for itself in the course of a year.
It’s easy for a buffet to become a breeding ground for bacteria, and the foods that a guest might not question if left out for more than a couple of hours — rice, sliced fruit or cut greens, for example — could spread illness if not monitored carefully. These foods are considered Time/Temperature Control for Safety foods. Statefoodsafety.com says these foods, which are high in carbohydrates or protein, slightly acidic or neutral, or contain moisture, are especially susceptible to bacteria contamination. While there are some foods on the list that are easy to guess, like meat, seafood and
dairy, make sure your kitchen staff are well aware of the others on the list that need to be monitored carefully and replaced regularly.
…Make some changes in your kitchen. As warm weather approaches, your kitchen and staff need to be able to adapt to the heat. Even if you’re careful about keeping your food preparation area clean and avoiding cross-contamination, the simple act of sweating can cause rapid multiplication of bacteria that can contaminate food. Make sure your kitchen is well ventilated, and train kitchen workers to wash hands and change gloves frequently, and to not handle food unnecessarily.
Environmentally friendly packaging is rapidly becoming the rule rather than the exception. Case in point: Some of the largest foodservice brands in the world — including McDonald’s, Wendy’s and others — have joined forces in an effort dubbed the Next Gen Cup Challenge to identify a cup that’s easily composted or recycled. Fast Company reports that most of the hundreds of billions of paper cups that end up in landfills each year are coated with a layer of polyethylene that makes them great for holding liquids but poor for the environment. Companies from around the world have submitted designs and 12 have been selected to share a grant that will enable them to test and mass-produce their cups. Brands will begin testing contenders in September, so watch them for clues as to what products are in the pipeline.
It’s pretty simple: Your regular guests are motivated to earn points for their purchases and to get transparent communication from you about what it takes to redeem those points. It’s a lesson many major brands have learned and are now adapting to accommodate. Skift Table reports that Starbucks, Chipotle, Pizza Hut and TGI Friday’s are just a few of the brands that have implemented new points-based loyalty programs in recent months, and to positive reviews. Some of the results have been dramatic. The report said that Punchh, a digital marketing company that helps a range of restaurants with loyalty program development, helped TGI Friday’s UK generate a 66 percent increase in revenue from loyalty program members and a 51 percent increase in new unique guest visits in the first four weeks of launching a new loyalty program in July. According to Mobile Marketing, the number of users referred by the app who made a verified visit to TGI Friday’s UK skyrocketed 300 percent in that same timeframe. The new loyalty program stands out not for its bells and whistles but for its transparency. While it started in 2015 (also with Punchh) as a “scratch, match and win” game designed to generate probability-based rewards, the new program has a spending-based system of points or “stripes” to help customers see the path they need to take to earn rewards.
The foodservice delivery industry seems to be evolving by the day. If you’re adapting your operation for more efficient delivery or thinking about offering it as a new option, take note of how third-party delivery companies are changing the market. Bloomberg reports that Uber has a pilot program underway in Paris that rents commercial kitchen space to restaurants selling food via the Uber Eats app. While the company has not commented publicly about this yet, it raises questions about how such developments could change the industry, perhaps controlling the choice consumers have when searching for a certain kind of restaurant, for example, or giving third-party providers a greater say in the branding of a restaurant business. Uber isn’t alone in this either: Grubhub, Door Dash and others have been investing in ghost kitchens in recent months. Postmates is adding yet another wrinkle to delivery by launching a new app, Postmates Party, to select cities that allows consumers to pool their orders and have them picked up and delivered (for free) by one courier.
Looking to build your business? You’re likely to have more success not by making incremental improvements to your menu — adding creative new condiments that make your burgers a little more interesting than your competitor’s down the road, for example — but by identifying and marketing your specialty. Christopher Lochhead, host of the podcast “Follow your Different” and author of the new book Niche Down, offers the example of Sushirrito, the San Francisco brand that pioneered sushi in burrito form. It combined two of the region’s favorite foods, sushi and burritos, and then focused on solving a problem: How can sushi be eaten on the go? Enter handheld sushi that just happens to introduce some interesting flavor combinations too. The fast-casual brand has generated strong traction in the area since launching in 2011, with now eight locations around the Bay area. They accomplished this not specifically for having better sushi than other restaurants in the region but because they identified a consumer need and found an inventive way to address it. Thinking small — creating and marketing to a specific niche and not simply trying to improve upon what you already do — can help you boost guest loyalty. The good news is that the data you collect about your guests has the power to help you drill down to specifics about their behavior, likes and dislikes, and spending habits. Based on what you know about your guests, is there a menu item you offer that is ripe for a reinvention? Do you know what other food your most loyal patrons enjoy that could give you clues about potential opportunities?
Conventional wisdom says that people who want a harmonious relationship shouldn’t go to bed angry, right? Toast is now applying that logic to negative restaurant reviews. The company commissioned a study that found that 65 percent of one-star reviews on Yelp were posted within one day of a dining experience. To use that one-day window as an opportunity for customer retention, Toast created Toast Guest Feedback, a new guest feedback platform that sends a text to a manager whenever their restaurant gets a one-star review. Often times this will allow the restaurant to correct problems in real time, deescalate customer concerns and avoid losing those customers permanently.
Anthony Bourdain’s death last year, along with a string of 12 suicides and substance-abuse related deaths among hospitality workers in Sacramento, served as a reminder of how restaurants can be fertile ground for mental health problems. The long hours, stressful pace and other extreme conditions can set the tone for unhealthy eating and sleeping habits that exacerbate mental health concerns. To help, a Civil Eats report that appeared in Eater said chef Patrick Mulvaney of Mulvaney B&L in Sacramento has partnered with Kaiser Permanente, VSP Global, WellSpace Health, the Steinberg Institute and the James Beard Foundation to develop a pilot program called “I Got Your Back.” The program, which has already launched in Mulvaney’s business, trains select workers to spot signs of mental distress at the restaurant. They wear a purple hand on their uniform and check in with other employees to offer support. Mulvaney has hosted workshops to connect with other operators looking to discuss mental health, and he is next looking to develop online resources to help workers in crisis find mental health professionals.
We all know that eating plants is better for us, for the environment and for the restaurant operator’s budget. But for flexitarians and carnivores looking to eat less meat, the idea of eating plants doesn’t always feel as satisfying — or to some, as nutritionally balanced — as a meal should be. Being reminded that they’re not eating meat doesn’t help. Enter the Better Buying Lab (BBL), a department of the World Resources Institute that helps businesses reframe their marketing of plant-based foods. Fast Company reports that following BBL’s principles helped one U.K. grocery store selling “meat-free sausages and mash” (to weak sales) make the change to “Cumberland-spiced veggie sausages and mash,” resulting in a 76 percent jump in sales in two months. They have also advised Panera and Google with similar efforts. BBL recommends companies avoid such terms as vegan, vegetarian, meat-free, or other health-restrictive terms such as low-fat, and embrace terms related to provenance, flavor, and look and feel.
At a time when many famous chefs are having to come to terms with their missteps in managing restaurant culture, chefs Ashley Merriman and four-time James Bear Award winner Gabrielle Hamilton stand out for knowing how to establish a healthy one. Hamilton opened Prune in lower Manhattan in 1999 and she and Merriman have since made it into not just a successful restaurant but an employee-friendly place to work. Guiding them are five simple values, which they recently shared in a Quartz report: Be thorough and excellent at everything you do, even when no one is watching; be smart and funny; be disarmingly honest (that means willing to tell the truth, but not in a brutal or overly earnest way); work without division of any kind (strive to put the person who sweeps the floor on equal footing with the owner); and to use service as leadership. That final point implies that through serving people, you set the tone for an experience with your greeting, eye contact and demeanor. They joke that they are actually an institute for living masquerading as a restaurant.
The California Consumer Privacy Act (CCPA) could have nationwide implications for how restaurants manage their data, protect consumer privacy and market their business. The National Restaurant Association hosted a webinar recently with Helen Goff Foster, a partner in the Technology + Privacy & Security for Davis Wright Tremaine, who reviewed the implications of the law, which is set to go into effect next year and could likely set similar legislation in motion in other states. The act will impact how businesses manage the consumer data they collect and the loyalty programs they operate. Unlike GDPR, which is about having consumers opt in to providing personal information, CCPA is about allowing them to opt out. In broad terms, for a wide swath of businesses, the law requires businesses to let consumers access the personal information you track, and gives them the right to delete information, and to opt out of the sale of that information. It also requires you to give consumers two methods of contacting you about it (including an 800 number). Businesses must therefore be able to retrieve consumer information across its affiliates, business units, product lines, etc. The law is intended to prevent businesses from providing discounted service or price to certain customers but not others (which clearly creates some hazy territory for businesses operating loyalty programs). There are fines in the thousands of dollars for violating the law and businesses could also be exposed to a private right of legal action by consumers against the business and its affiliates. Franchises could be especially vulnerable because they could bear legal risk but aren’t able to dictate privacy policies of their parent company. Foster advised that the best thing businesses can do now is identify where their consumer information is and how to access it. You’ll need to determine how to provide opt-outs for most of your consumer data and assess the ability of your vendors to do so as well, so update (or establish) your information security program. For more information about the law’s potential effects on restaurants, access Foster’s webinar and Q&A here.
The real power may lie not with restaurants but with the delivery apps and food delivery companies that help them get their food to consumers. That’s the implication of two recent reports in the Wall Street Journal, which indicate that these companies are poised to move away from traditional introductory offers and toward subscription-model services designed to entice consumers into becoming habitual “superusers.” At a time when millennial consumers are believed to lack loyalty, delivery providers have noticed that offering a one-time discount won’t translate to follow-up business. How does your delivery provider entice customers to return regularly? DoorDash, one provider offering a subscription program, says it has more than 30,000 users signing up each week for their service. It now leads the online food delivery market in total consumer spending.
At a time when Instagram is helping restaurant menu items go viral and having a well-curated social media presence is billed as a must for a growing business, it can be easy to overlook the power of email. But the numbers tell an important story: According to research from the Direct Marketing Association and Demand Metric, the return on investment for email marketing is 122 percent compared to just 28 percent for social media (other marketing channels rank similarly low). Email carries a number of benefits. When you pour your marketing dollars and ideas into your email list, you retain control of what happens next. You’re not at the mercy of changes to a social media network’s algorithm and you stand a better chance of reaching your most loyal guests directly. Your email subject line has the power to prompt the recipient’s action at the time you send it — you’re not competing with content on a person’s social media feed or having to wait until people visit their account. As The Rail suggests, you can use your data to deliver a more customized experience via email, sending messages when you know your list is most apt to open them and with a mix of images, video and text depending on what you’d like to promote. There are also ample email tools to target guests with not just birthday promotions but also deals that consider their personal preferences and ordering habits. OptinMonster suggests using your list for such tasks as nurturing your loyalty program and spelling out its benefits, winning back guests who haven’t visited in a while, or following up with people who made a Groupon deal or otherwise expressed interest in your restaurant but haven’t visited yet.
When food is prepared and waiting to be eaten by a hungry consumer, every minute can impact the quality of the meal. Now that so many operators are embracing consumer demand for delivery and are seeking to stand out in a growing crowd of off-premise dining options, the next push is to make that delivery as fast and seamless as possible. For a number of major brands, that means delivering in less than 30 minutes and striving to shave additional time off of that rate. In addition to restaurants adding pick-up shelves for delivery drivers collecting orders and opening delivery-only kitchens in locations with a critical mass of customers, Skift Table reports that some brands are introducing prepaid delivery for third-party couriers and retrofitting vehicles to become mobile kitchens that can cook a pizza on the go. (Pizza Hut, for one, is testing a robot-powered pizza kitchen that sits in the bed of a modified Toyota Tundra.) How can you shave minutes off of your delivery?
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