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Automating Hospitality

Hospitality Technology – The use of robotics is experiencing exponential growth with global robotics market revenues forecasted to grow from $28 billion in 2015 to $151 billion a year by 2020. Tractica predicts the majority of that growth will come from “non-industrial” robots. Scott Langdoc, senior vice president and practice lead at Boston Retail Partners (https://brpconsulting.com), says that the hospitality industry will not be immune to the increasing applications for machines taking on tasks once relegated to humans.

Hospitality Technology’s research reveals that robots are a burgeoning area of interest for hotels and restaurants. According to the 2018 Lodging and Restaurant Technology Studies, one out of four hotels (25%) named robotics a top emerging technology, and 33% of restaurants believe robots will make an impact on foodservice.

“We expect to see a significant increase in the deployment of both customer-facing and efficiency-oriented robots throughout the hospitality industry — both in terms of total robotic units deployed and in the number of hospitality locations using them,” Langdoc states. With dramatic improvements in cost, industrial design, and AI-based engagement capabilities, the number of potential robotic uses cases has tripled in the last 18 months.”

Though social acceptance of robots is increasing and more people are willing to use, touch and interact with them, many worry about what they see as the inevitable loss of jobs as the usage of robots increases in the hospitality industry. Boston Retail Partner’s Langdoc sees this as a challenge.

“The use of robotics must be seen by the guest as an augmentation of guest services, not as a replacement for the human labor element,” he says. “It is paramount that companies deploying robots properly promote and communicate the initiatives to avoid potential negative reaction from guests that perceive the robots are ‘taking away jobs.’”

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Data Helps Restaurants Battle Profit Loss

Hospitality Technology – As consumer confidence in the economy rises, more people are heading out to eat. While good news, restaurant owners remain focused on retaining sales and preventing profit loss. Analytics and exception-based reporting tools are integral to building effective, scalable solutions for detecting fraud. For years, restaurants have used analytics to both prevent and detect fraud, but now there are new tools to find information and alert operators to issues. Every modern POS system and integrated security system comes with a range of controls and includes some type of smart reporting. Ed Heskett is the senior area coach for Border Foods (www.borderfoods.com), which has approximately 200 Taco Bell franchises. He notes that the analytics department at Border Foods looks at the fleet at large scale and generates reports with a focus on underperforming stores.

Border Foods uses a Delaget (www.delaget.com) reporting tool and a location dashboard daily, which gives the company a snapshot/summary and alerts it to potential problems. According to SpeedLine Solutions, Inc. (www.speedlinesolutions.com), POS systems send an alert that can come in the form of a message or report when suspicious activity occurs. Every notable event can be tracked.

Being able to collect, analyze, and react to information in a short time span empowers restaurants to take action and address potential problems before they mushroom.

“Collecting transactional information for analysis in real-time is imperative for a successful loss prevention-oriented, exception-based reporting or BI platform for restaurant brands or franchise operators,” says Scott Langdoc, senior vice president and practice lead at Boston Retail Partners (https://brpconsulting.com). As the time between a loss or fraud event and its detection increases, investigations become more challenging. On-duty managers must leverage well-developed fraud analysis thresholds to address outlier events — especially staff-related issues — as quickly as possible.

“For many, the movement to cloud-based POS has helped make data available more quickly for loss prevention (LP) intelligence. Companies with traditional, on-premise POS systems must rely on faster POS transaction syncing to centralized systems to enable near real-time aggregation and analysis of local POS data for trends and exception-based monitoring,” Langdoc says.

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Restaurants need to Double Down on Delivery

Grocerant Guru – Driving top line sales and bottom line profits while consumer’s path to purchase is evolving faster than most legacy restaurant brands has created a quagmire that stagnates customer count growth according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

In a recent Digital Commerce Survey from BRP found that same-day delivery has tripled in the past year with more growth to come. Here are some specifics:

  1. Currently, 51 percent of retailers indicate they offer same-day delivery, a sharp jump from 16 percent last year.
  2. Within the next two years, 65 percent plan to offer this service.
  3. Delivery through third-party services, such as Uber or Lyft, also rose from 20 percent last year to 32 percent this year, as retailers try different ways of offering customers the flexibility to shop, purchase and receive goods on their own terms, the survey found.

Jeffrey Neville, vice president at BRP stated “With Amazon offering same-day delivery in some markets, the push is on for retailers to get items delivered to customers as soon as possible,” said. “Autonomous delivery and distribution are the next step with self-driving vehicles soon a reality and a few food delivery start-ups already testing the concept.”

Read Full Article: Restaurants need to Double Down on Delivery

5 Technology Trends to Know

QSR Magazine – In an age when technology is king—of every consumer and in every industry—it’s no surprise that four out of five customers believe technology improves their restaurant experience, according to research from restaurant software provider Toast. That’s just one of the reasons why today’s brands are putting innovative technologies to work in their stores, and often reaping the rewards from it.

But with the plethora of high-tech options out there, how do brands know what’s worth the investment? We polled several operators and industry experts to uncover which technologies are changing the game in five different areas of the restaurant—and which ones they’re itching to explore next.

Often entwined with today’s highly personalized apps and loyalty programs is another trend popular among restaurant marketers: gamification. Chipotle has long been a leader in the food-gaming space, but brands like Popeyes, Auntie Anne’s, Taco Bell, and Burger King have been pioneers as well.

“In gamification, there are very sophisticated linkages to marketing and promotions, to discounts, to loyalty programs,” says Scott Langdoc, vice president of consulting at Boston Retail Partners. “There’s a way in which the customer cannot just win the game, but actually get measurable benefits—be it by discount or promotion or some other award—as a result of spending time with the game on that app.”

With minimum wage and operational costs rising, a growing number of chains have turned to digital and automated ordering platforms—think tabletop devices, iPad ordering, digital kiosks, and various online ordering systems—to replace employee labor and increase sales volumes.

However, recent research from the National Restaurant Association shows that while many consumers appreciate high-tech options like online ordering, kiosks, and mobile payment, they aren’t looking for a total switch to automation in their limited-service experience. That’s why Boston Retail Partners’ Langdoc says many operators are providing consumers with choice above all else, combining ordering technologies like kiosks and tabletop devices with the age-old counter-service option. “Touch-point choice is more of the successful trend instead of just assuming that we’re going to see this holistic black-and-white migration to automated ordering,” he says.

To aid in the confusion that often comes with a plethora of ordering options, Langdoc says, a number of brands are opting for useful (though not-so-sexy) technologies like order-status screens. Restaurants are likely to manage the multiple points of ordering by installing digital displays that tell customers when their order is in process, complete, or ready for pick-up.

Read Full Article: 5 Technology Trends to Know

Restaurant Loyalty: 1 Best Guest = 9 Average Guests

Best-Average_GuestsLoyal customers are extremely profitable for restaurants. In fact, a restaurant’s “best guest” can represent the same revenue as nine “average guests.”

Here is an example how a company with two restaurant chains (representing 285 stores) realized the importance of customer loyalty and launched a loyalty program that was quite successful.

CASE STUDY: Restaurant Chain’s Loyalty Program Drives Incremental Visits and Revenue

With free standing inserts (FSIs) as its primary marketing activity, the restaurant chain realized that implementing a loyalty rewards program would be a great way to understand who its customers were and incent them to visit its restaurants more frequently and spend more money. The key goals of the rewards program were to: increase sales and frequency, collect customer data to make better decisions and reduce its dependence on FSIs.

Objectives

The main purpose of the chain’s CRM/Loyalty solution was not to launch a points/rewards/plastic card program to merely offer its customers discounts. The rewards were just a means to an end. The main objective was to discover who their customers are, track their behavior, understand their preferences, cater to those preferences and develop ongoing two-way communication with its customers.

The goal was to build stronger relationships with its customers to increase frequency, per-check revenue, marketing efficiency and ultimately a competitive advantage.

Approach

When considering launching the loyalty rewards program, the chain identified four key success factors:

  1. Make it simple for guests to understand.
  2. Ensure employees consistently communicate the program to guests.
  3. Identify a reward structure that is compelling for guests and affordable to fund.
  4. Implement a program that does not cannibalize sales.

The strategic plan included detailed analysis of the following unique and distinct areas of the chain’s operating environment and proposed reward structure:

  • What information is required in the customer database?
  • What is the best approach to the loyalty program rules (points, product, tiered, layered, and promotional)?
  • What is the best way to communicate the program to the guests (campaign management requirements)?
  • How to effectively launch and drive participation in the program?
  • How to measure success/return on investment (ROI)?
  • What are all the key steps in the program development and implementation (sequence and timing/road map)?

Key components of loyalty reward program strategy that helped ensure that the key success criterion were achieved include:

  1. Buy-in from the top executives and all levels of management.
  2. Simple program structure of 10% (every $50 in purchases earned a $5 reward).
  3. Effective train-the-trainer program to ensure all employees know how to communicate and promote the loyalty program.
  4. Customized one-to-one communication to members to keep them interested and remind them of their point/reward level to encourage frequent visits.
  5. Leverage the customer data to guide decisions and evaluate the program results.

Results

The results of the Rewards program exceeded expectations with high member sign-up and participation, improved visit frequency and increased average check size. The rich data collected from the Rewards program was eye-opening from a customer loyalty and customer value perspective. Based on revenue contribution, one of the most loyal “best guests” generated the same revenue as nine of its “average guests.” Now that’s loyalty! Other key results from the Rewards program included:

  • 43% of guests participated in the Rewards program
  • Rewards members visited 35% more frequently
  • Rewards members spent 24%-32% more than non-Rewards guests
  • 1.8% of Rewards member “best guests” drove 7% of total revenue