Big data. It sounds like one of those terms you’d hear tossed around at companies like Amazon or Google … but at restaurants? Believe it or not, data is becoming a highly valued asset for restaurant managers — not just those at big chains — and technology partners are making that data more easily accessible and easier to understand than ever before.
Seeking a Competitive Edge
Part of the reason for the industry’s interest in data is an increasingly competitive environment. According to the National Restaurant Association, about 60,000 new locations open their doors every year … while another 50,000 shut down.
There’s no question that competition in the restaurant industry is at an all-time high. As restaurants strive to compete, they must leverage every asset available to them, and data offers them the clear, accurate insights they need to make informed decisions and take advantage of often missed opportunities.
Where Is the Value in Restaurant Data?
Restaurants collect data from a wide variety of sources, including POS systems, inventory tallies, loyalty program records, customer surveys, and even social media and email response analytics. Historically, the task of compiling and analyzing this data has been so daunting that few restaurants attempted it … but distributed analytics technology is changing that.
Restaurant managers are discovering how data can help them better understand customer preferences, improve menus and service, improve operations, and enhance their overall customer experience, all of which can lead to higher profits.
New Solutions for a New Era
New systems and new technologies are giving restaurant brands unprecedented insights into their operations and their customers. These solutions aren’t just about gathering data from numerous sources — they put actionable information into the hands of individual managers and other stakeholders across the organization.
Years ago, only large organizations had access to robust analytics — and the specialists who were needed to interpret them. But today’s solutions are democratizing data, empowering managers in smaller organizations as well as large chains.
One Organization’s Story
For one national chain with 500 restaurants, the big-data journey began in 2015. Driven by challenges around combining data from all its restaurants and source systems to provide actionable insights, it implemented a system to collect data from its POS, loyalty programs, customer surveys, marketing promos, and inventory systems to deliver real-time feedback on several KPIs.
Thanks to its analytics system, the chain has gained a deeper understanding of its customers, their needs, their preferences, and even their social media practices. Data is gathered and processed every 20 minutes, making real-time analytics available to managers at all levels of the organization.
Putting Data to Work for You
If your organization is just starting to consider using all of your data to help drive business decisions and drive top-line revenues, the task of putting a system in place might seem daunting. Here are a few tips to get you started:
- Break the project down into manageable pieces and approach it one step at a time.
- Decide which specific objectives you want to achieve — such as improving margins by reducing waste, understanding unexplained variances in stock, finding out which menu items are most popular, or deciding whether to offer free WiFi — and collect the data that can help you answer those questions.
- Make sure that your POS is correctly categorizing food and beverage items, and that it’s delivering the data you need in a usable format.
- Find out what kind of customer data is available from your payment processor.
- Designate a leader who can bring together a cross-functional data collection team.
Why the Time Is Now
Have you considered what a one percent decrease in labor costs or a two percent decrease in food waste would do for your bottom line? The keys to these improvements — and many others — lie in your very own data, and today’s technology is making it easier than ever to access, understand, and act on that information. There’s never been a better time to explore solutions that can turn your data into not just a strategic asset, but also a profit center that works for you to grow revenues and improve margins.
Morris was a contributor to the recent white paper How Big Data is Revolutionizing the Restaurant Industry.