While sales, marketing, branding, menu enhancements do help to draw in customers; restaurants are missing out on taking due advantage of a critical factor that is often overlooked in everyday decision making. There are numerous critical questions that need spot-on and correct answers for restaurant management and restaurateurs to ensure and facilitate stellar decision making and move the restaurant business to the next level, while helping the topline, bottom-line, guest experience, and enhancing the team’s efficiency.
While sales, marketing, branding, menu enhancements do help to draw in customers; restaurants are missing out on taking due advantage of a critical factor that is often overlooked in everyday decision making. Customer data (subject to compliance), when mined successfully and studied methodically, can yield insights that can be used to enhance business, every day. It is tempting to join in right away but data can yield results only when it is collected objectively.
Let’s look at a list of few of these paramount questions: What has been our restaurant occupancy in last weeks? Which hours are our busiest? How much is our average order value? Where do we get most of our guests from? Segmenting and targeting. Who are our top spenders, bottom spenders, potential spenders? Which loyal guest likes which F&B items and what do they dislike? Which is our most profitable food & beverage items and least profitable items? Quantity of top menu items sold each day – plan the F&B inventories accordingly? Which vertical contributes the most at each of the outlet: delivery, online platforms, dine-in, take away or bulk corporate orders etc.? All the above crucial questions can have a major impact on the food and beverage business and can assist restaurateurs look deeply and closely at the business and make progress. The magic pill here is “data analytics” – in simple words process of gathering meaningful data, scrutinizing, cleansing, transforming and exhibiting data with the goal of ascertaining beneficial information, intelligent conclusions and facilitating decision making. In today’s world most big organizations make the most of all the data available to them. Unfortunately, excellent use of data analytics is more or less non-existing in the world of food and beverage outlet operations.
The time is now ripe & right to actively look into the monster data that restaurants collect knowingly or unknowingly on a daily basis at their several outlets and make sense of the data, through mindful study and analysis. First and foremost, would be to opt for systems and software where data is collected efficiently, without errors and in meaningful ways. Outlet level teams as well as central head office of F&B organization should all collect data with utmost clarity and error less. Below are few key pointers wherein data analytics can make the restaurants shine and create amazing experiences for their guests while having the team operate at high efficiency levels: Guest segmentation and targeting: As we learn more about who are our patrons and which kind of people like to eat-in with us or order home delivery, we can accordingly strategize and target the most relevant set of customers.
For instance, at our brand Kebabs & Curries Company outlets in Jaipur, we witness families coming to dine-in at restaurants and on the other hand, our delivery orders are mostly placed by youngsters aged between 25-30 years. This kind of distinct segmentation can allow us to target campaigns, offerings and other marketing initiatives as per our guests. And this is all possible with data analysis. Efficient team & superlative operations: To perfectly explain this let us look at an example – looking at our past data about which are our top sellers, which of these items we sell on which days and the time slot wherein most orders are received – once we are weaponized with such vital information, we can plan our inventories, food preparations and staffing suitably and stand strong.
Customer equity & loyalty: Can we know our customer’s lifetime value, can we judge how loyal is our customer to us, can we increase the wallet share of our existing and faithful guests? Answers to these top questions are already there in the data that flows into our billing and customer relationship management software. We simply have to start making sense of it by closely assessing the complete data. Sales projection and business trends: How we are going to do next month, what are the sales projection for coming quarter, can we align our manpower as per the business demand. How has Covid pandemic impacted the business trends, are we ahead of the wave of business trends and actually riding it – only data analytics can make these questions and their answers a cakewalk for restaurateurs. Data analytics is the latest and biggest industry in today’s world and data is the new oil shaping up this buzzing industry and our food & beverage world should accept this with open arms as we can create magic for our restaurants/ outlets and kitchens through the magic pill of data analytics.
At our restaurants huge amount of data pours in every second of our operations, all we have to do is to collect it well, clean data and then start to put it together so that we can make business sense of our data and as restauranteurs we can make informed decisions backed by numbers and evidence. In my upcoming article we would discuss more about brilliant key performance indicators related to restaurant data analytics like competition analysis, sales mix, blended pricing structure, contribution margins, prime cost (product cost + manpower cost to produce an item), RevPASH as concept, menu engineering and a lot more. So, are we going out to look for a data scientist who can help us pop this magic pill? Yes absolutely. Varun Behl is a Jaipur based restaurateur operating a chain of restaurants and QSRs (Quick Service Restaurants). Varun is a seasoned food & beverage and hospitality management professional with experience spanning over 17 years; a decade of which is with Marriott International in India and its global operations. Food and beverage and entrepreneurship are his forte – which he lives every day and is keen to share his insights with peers and mentees alike.