Fortunately, new technology lets restaurants adopt some of ecommerce’s best practices. From an IT perspective, this requires four key elements:
A system to close the loop at the guest level on promotional offers. It’s not enough to have a POS discount key for “Father’s Day promo” anymore. You need to know which dad (or mom!) responded to that offer, what they bought, and who they brought in with them.
The ability (either directly or through your credit card processor) to access payment data in order to identify individual guests when they return. This data set is essential – it’s the lifeblood of ecommerce. Fortunately, the ecommerce players have pioneered safe, secure ways to get at data without compromising PCI safeguards.
A guest-centric data warehouse to store all the key data sets — check level POS data, payment data, marketing data, loyalty program data if available, reservations, online ordering, guest responses, and third party data such as Prizm or Mosaic.
An analytics layer. The requirements here go way beyond static or standardized reporting. Marketing needs to be able to cut data in an ever-changing variety of ways to identify key patterns and segments.
Marketing, in turn, must partner with IT on determining goals. What is the restaurant trying to accomplish and what can be left out? Take joint meetings with IT to look at vendors to help give a sense of what’s possible. But then let IT do their job. Next, build the business case. Moving to a data driven marketing strategy will require shifting budget from other media, or finding new budget dollars. Determine appropriate metrics and the desired payoff. Setting up high level, high visibility “report cards” is critical. For example, “Our 2015 goal is to grow the annual spend of our top three customer groups by 4%, thereby delivering $17.5M of incremental sales.” That will get the CFO’s attention and the goal is doable. Finally, design and execute the marketing plan. That will likely require a trained data and analytics expert, and/or a close partnership with a company that analyzes data 24/7. Either way, it’s important to not over-reach in the beginning. Year one is about becoming familiar with the data, drawing insights, and learning a new language—segments, deciles, annual spend, customer acquisition costs, and lifetime value. The good news is there is usually a great deal of quick wins, such as offer optimization.
Introducing data-driven marketing may seem like a daunting task, but the ability to predictably drive sales should incent even the most cautious. The benefits of bringing an early mover are huge. These restaurants will have more data to work with two to three years out. More data, gathered over a longer period of time, becomes its own competitive advantage. Just ask Amazon.
This is a very detailed article about the various ways that hospitality firms are utilizing technology and using their capital to invest in IT related projects. A variety of hospitality firms were surveyed to produce this article on ways they plan to invest in IT and the various projects they feel are most worthy of their dollars. Some of the areas that were most noted and listed as worthy of additional IT investment include improving technology to improve financial performance and enhancements in CRM and loyalty programs, guest experience technology and ensuring the guest stay is always seen as paramount, as well as improved information and cyber security technology as well as an increased focus on understanding big data and improving employee engagement. This article is highly detailed in what it analyzes and it lists a long list of potential investments that a variety of companies will be taking on in the future. The focus of this article was on the year 2017, but many of these concepts still apply to the hospitality industry today and well into the future. Many of these things listed are also things we can see that many companies worked on leading to 2018 and continue to work on and it is the companies that put these IT investments at the forefront that will be leading the hospitality enterprises of the future.
