Lunchtime looks different in many cities right now. A recent report from Restaurant Business said that according to new data from tech supplier Toast, weekday lunch transactions in 19 of the country’s biggest metropolitan areas remained down considerably in the first quarter of 2023 compared to 2019. The numbers suggest that the shift in post-pandemic work habits is having a continued impact on lunch business. When Americans do have lunch out, they are spending more, which could be due to higher menu prices, or because people are dining out in larger groups and placing bigger orders. In any case, the lunch day part has potential to become more of an experience driver in the current environment – a time for events as opposed to casual meals in the middle of the work week. Consider the new working habits of the organizations with offices in your area – or the people who reside in your neighborhood. Have hybrid work arrangements become the norm? If so, employers are likely looking for opportunities to bring employees together in meaningful ways on the days they do come together – and catered food can play a big role in that. If people living near you are working from home, they still need to eat – and maybe you can provide a meal deal, salad kit or delivery promotion that can make at-home break times feel like something to look forward to. Inflation has made restaurant meals a tougher sell for consumers, so the experience of your restaurant carries more weight. In a recent webinar from Datassential, speakers referenced some very different examples that illustrate how restaurants are approaching this. For example, at the Mini Chef restaurant at the Lego House in Denmark, each guest is given a packet of 16 Legos. Each piece in the packet corresponds to a customizable ingredient listed on a simple menu. To submit their order, a guest must “build” their desired combination with their Lego pieces and submit it into a machine at their table that confirms their preferred ingredients. The novelty of the ordering system becomes entertainment – and as much of a focus as the food. But boosting your experience doesn’t require an operational overhaul. Consider one low-tech approach by a restaurant across from a children’s hospital: Guests can buy a beer for a parent or carer of a patient at the hospital and their purchase is marked with a sticker on a sign posted in the restaurant. The free beer can give recipients a brief respite from the stress of a hospital stay and help those buying it feel like they are doing a good deed for someone who needs a lift. When you take approaches like this that are special to your brand, you can get guests in the door. If you then combine them with guest personalization – by collecting data about what a guest has ordered in the past, what they like and dislike, and then making targeted recommendations they are more likely to enjoy – you have a formula to keep those guests coming back. Considering your own community, guests and brand, how might you adjust the experience you offer in ways that have a big impact? When you think back to how you set out to connect to potential customers during the pandemic, does it feel like anything has changed since then when it comes to both your marketing and interpersonal communication with guests? It wouldn’t be surprising if so. After all, restaurants hardly had a chance to recover from COVID lockdowns when they were suddenly thrust into managing rising inflation, supply chain snags and ongoing labor challenges, among other difficulties. Operators moved from one existential crisis to another, but the emotions these crises evoked have been very different. The pandemic brought out a softer, more emotional side to communication – something that may have been lost in the months since. It’s worth taking a look at how your efforts to connect with guests during the pandemic were effective then because they could be what solidifies guests’ loyalty to you now. How did you make people – guests and employees – feel supported? How did you share your restaurant’s story in different, human, surprising ways? A recent Modern Restaurant Management report about the importance of emotional intelligence in business communication shares some signs that your restaurant could be lacking it: A few examples include leaning on one message for all guests versus employing more personalized communication, providing inadequate responses to guest feedback, and emphasizing more on what you’re offering as opposed to how it benefits guests. Knowing this, could you make any improvements to how you’re connecting with the public? The past few years have been hard – but don’t let them harden the human approach that continues to win with consumers. At a time when having multiple income streams is vital for restaurant brands, catering services can be an important contributor to the bottom line. Last year, business-to-business catering sales rebounded to 2019 levels, according to remarks by Jim Rand, founder of CaterStrat, at an education session at the recent National Restaurant Association Show. What’s more, he said segment leaders such as Panera and Olive Garden don’t command a majority of overall catering sales, so there is ample room for smaller brands to carve out their own niches in catering for consumers and events. Now that COVID-19 seems to be receding into the distance, consumers and organizations are looking for opportunities to gather with friends and staff again. Fine-tuning your catering capabilities now can help you take advantage of summer sales and also give you some momentum to capture catering orders leading into the holiday season. As a recent Restaurant Dive report advises, developing business in this area requires many of the same approaches operators use to strengthen other parts of restaurant sales right now: ensuring orders are accurate, consistent and quick. (This is especially true for corporate catering, for which a restaurant generally doesn’t have more than one or two chances to recover after an error with an order.) Having a catering-specific ordering platform can help support these customers, along with a marketing strategy to spread the word about your brand and its catered offerings. While operating a restaurant has long been a practice of managing on razor-thin margins, the rising costs of everything from food to labor to energy have given many operators no choice but to adjust their model. According to a recent report from Fast Company, that has meant a growing crop of restaurants are entering the consumer packaged goods arena, providing popular menu items and accompaniments that consumers can pick up at the grocery store and keep in their pantry or freezer. To be sure, restaurant-branded condiments and meals are hardly new – they have been around for decades. But the range of them has been exploding in the past few years and continues to grow, with products as diverse as burritos from the Mexican chain Tacombi and smoked mushroom garum from Copenhagen’s Noma getting into the act. The income stream not only has the potential to help a restaurant expand its brand well beyond the regions where it prepares and serves food, but also to more easily ride the waves of a challenging economy (or even a pandemic). The perception of restaurant-quality food in a grocery setting may also give it the lift it needs to secure a sale. Indeed, even in an environment of high inflation, consumers have still been able to justify splurging on their favorite restaurant brands in retail settings, according to the Food Institute. As you open your outdoor dining area to guests, your ability to cater to their canine friends can provide an extra draw (while at the same time deter other guests who aren’t as fond of dining with animals nearby). While the FDA Food Code hasn’t historically allowed for animals aside from service animals on restaurant premises, more than 20 states and several local jurisdictions have regulations permitting dogs – and a 2022 update to the FDA Food Code could pave the way for additional areas to allow dogs onsite. If you’re considering it – and you may decide it’s not for you – the National Restaurant Association advises restaurants that are allowed to have dogs on their premises to abide by several best practices in the interest of preserving safety and harmony with guests: Understand your local health regulatory agency’s rules – while some agencies simply require a permit, others require more official notification of your intentions to allow dogs in your dining area. Require guests to keep dogs leashed, in control and off of chairs and tables – and ensure staff know how to respond and what cleaning and sanitizing procedures are required if those rules are broken. Use signage and language on your website and social media to make your policies clear to dog owners and others so everyone knows what to expect. Train staff to avoid handling the animals – or to ensure they wash hands immediately afterwards to avoid cross-contamination. Finally, ensure guests with dogs know where and how to manage pet waste while on your premises – and consider providing a refuse container for their use. If you’re on the fence about opening your patio to dogs, you may be able to find a middle ground that pleases everyone – setting aside just one day a week for a dog-themed dinner for dogs and their human companions, for example. At a time when food and labor expenses are so high, restaurant operators have to recoup costs from somewhere. Increasingly, they are leaning on check surcharges for help. These surcharges, which often total 22 percent of the bill and higher, are likely here to stay. But in the meantime, they tend to cause confusion among restaurant guests and employees alike. As a recent report from the New York Times puts it, these charges are often “tacked on with little explanation. Questions immediately swirl. Is this a tip? Does it go to the wait staff? If not, should I leave more money? Is it rude if I ask my server any of this?” It can add up to confusion, awkwardness and annoyance at the finish of a meal – not the final impression any restaurant wants to create. Part of the problem lies in calling the fee a service charge, which guests tend to conflate with a tip and consider voluntary. Some restaurants that want to eliminate tipping use the service change to do so, while others still accept tips. What’s important is to avoid surprising people. Be transparent about your fees with both guests and your staff. That includes including language on your menu and website to explain what your service charge includes and how it helps staff, as well as showing staff on their paychecks exactly how these charges are benefiting them. If you’re using these charges to pay for health benefits for your team, for example, that is a good story to share with guests and employees alike – and something everyone could get behind. Consumers like a good value – and increasingly, they are looking to loyalty programs to provide it. A recent consumer survey by PYMNTS found that 51 percent of respondents said they used a restaurant loyalty program. This was true across restaurant categories, with 49 percent participating at quick-service restaurants and 34 percent participating at full-service restaurants. This is spurring restaurants to reinvent their programs with new tiers, increased personalization and new payment capabilities, among other enhancements. There are more businesses vying for more signups to their loyalty program, so it will take a well-coordinated effort to get guests to join. Consider offering a tempting incentive to get people to sign up – a discount on their purchase that day, a free drink or snack, or another popular item you offer. Then get your staff on board, since they are likely the ones who will be prompting guests to join. Make sure they understand it, can explain it, and have some opening language on hand to promote it – have them share suggestions with each other or even engage in some competition for guest signups. Then make sure you promote the program on your website, store signage and social media – with clear language, simple prompts and an easy means of joining (like a QR code that will take guests right where they need to go). Your social media is another avenue to create contests and potentially viral content around your program. As restaurants continue to look for ways to offer prime experiences to diners while catering to their most frequent visitors, the process of booking a restaurant reservation is beginning to resemble the process of booking a flight – with perks for those willing to pay for a first-class experience. As a recent CNBC report says, the guest management platform SevenRooms is offering restaurants tools such as online ordering, waitlists and reservations, in addition to customer data that restaurants can use to promote enhanced experiences or sell upgrades to certain clientele. That could mean getting first dibs on patio seating at sunset – or simply better access to prime tables at peak dining hours. Participating restaurants are finding that this capability to make reservations more exclusive is giving them some extra ability to accommodate walk-ins and lingering diners, as well as greater assurance that the people who have booked a reservation will honor it. The evolution of restaurant reservations is coinciding with renewed investment in the fine dining space, which is having a post-COVID moment right now. The category is ideally matched for the current need for restaurants to build higher-end experiences into their service – and consumers’ willingness to spend at restaurants if what they are receiving feels special. It’s a question more restaurant operators are asking this year, as the cost of third-party delivery has increased beyond consumers’ and operators’ comfort zones. According to the National Restaurant Association’s annual State of the Industry report, an average of 13 percent of restaurants have stopped using third-party delivery services – even though delivery continues to be in demand by consumers. The trend was especially apparent outside of the quick-service category. While only 7 percent of quick-service restaurants severed their ties with third-party delivery companies, 17 percent of fine dining and coffee and snack businesses did so. The research found that instead of forgoing delivery altogether, most restaurants are taking the function in-house. The move can give operators greater control over food quality and safety, speed of delivery, as well as a larger share of profits. But it does require some planning and resource management. If you’re considering it, determine what geographic areas you want to serve and during what hours, how many staff you will need to support the effort, how they must be trained on everything from technology to off-premise food safety, and how you will mitigate your business liability if problems were to arise in the course of a delivery. What technology and tools could support you? Could a delivery management platform help? Test your service over a set period and track what went well and what needs to be improved. Also think about if and how you will promote this offering to guests – and if and how you want to use it to convert more orders to carry-out. In any case, collect data on how your delivery is going – both with regard to delivery times and reactions from customers. |
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