Regaining control of data is paramount for restaurant brands after two years of data collection being in the hands of third-party delivery partners.
Most restaurant brands, from QSRs to fast casuals to pizzerias, will admit to a clear truth: Third-party delivery played a substantial role in surviving two years of the COVID-19 that shuttered eateries nationwide and forced brands to rely on services such as Uber Eats and Door Dash to keep revenue flowing.
But the survival assistance came with a big caveat — third-party partners now had valuable data about brand customers — from what items they ordered to when they ordered and how often they ordered.
That vital customer data was not funneled into the brand’s data warehouse for over two years and illuminates a gaping marketing hole as brands pulled back from third-party partners and return to pre-pandemic operations.
The value of customer data, and capturing data from customers brought in by partners, was the focus of a panel talk, “Taking (Back) Control of Customer Data,” at the Restaurant Franchising & Innovation Summit hosted by Networld Media Group this month in Nashville, Tennessee.
It’s one of several industry events organized by Networld Media Group, which is the parent company of Fastcasual, Pizza Marketplace and QSRweb. The media company’s next event is a virtual pizza conference, the Pizza Leadership Virtual Summit, which will take place July 27.
The annual three-day RFIS event draws executives from leading brands to share successful ways to grow franchises.
The value of partners
The panel talk was moderated by Corinne Watson, director of content at Lunchbox, which sponsored the session. Panel participants included Doug Baker, director of marketing for Wing Shack Enterprises; Claiborne Irby, SVP, customer engagement and strategy at Focus Brands; and Sherif Mityas, operating partner at Jamco Interests LLC and Brix Holdings.
In kicking off the talk Watson asked panelists to speak to the role of third-party partners and related strategies that came into play.
Irby shared an analogy of how the hotel industry initially faced off with online travel platforms a decade ago.
“At first, it’s really nice to have this business and suddenly it became a threat, like oh my gosh they’re really expensive and then it came out to a balance and so I see with the restaurant industry it’s going the exact same way. It’s nice to have as a source of business but you need to be careful about being fully reliant on them because you may not be in control of the destiny where Uber and Door Dash are going, so it’s important to understand how that customer fits into your stack of business and manage it accordingly,” he said.
Baker acknowledged his brand would not have been able to survive without Door Dash and Uber Eats.
“Their value prop is just too strong, their market share is just too big so where we have tried to focus, especially since 2019, is on how we tug back some of those new guests brought in by those partners and make them become brand loyalists , he said, adding, “It’s a give and take because there is a value proposition that is hard to beat. It is a sort of a convenience culture. to brands advocates.”
Mityas agreed third-party services were “critically important” during the pandemic and given their business model that they have trained the next generation of consumers to expect “this type of channel,” as well as the resulting interaction and engagement.
“What we have to do now, as brands, is actually be better [than third-party partners] if I want to get those customers back,” he said. “Don’t blame Door Dash that a consumer is going to Door Dash. Look inside. If I can be better than Door Dash, they’re going to come to me.”
Watson then pitched a question to the panelists regarding regaining customer loyalty and building loyalty with the customer that met the brand through a third-party partner.
The high value of loyalty
Irby defined an excellent loyalty strategy as one that’s interesting and customer engaging and one that is mutually beneficial to the brand and the customer.
“You need to understand who that person is and how we treat them. We have a lot of data thankfully and start using things like AI and machine learning to understand why who’s doing what and how and we start giving more relevant offers and that makes It is beneficial to the customer,” he said, adding the company conducted research last year on its loyalty programs and learned customers wanted to earn rewards more frequently.
“So, we give them smaller but more frequent rewards and it ends up being very well balanced. By getting into the consumer’s mind and understanding their behavior we’re giving something that’s relevant to them and in a way that’s advantageous to the unit’s local economics .”
Going forward, he said, it’s all about gaining more useful and fruitful data points.
“If we think about this as a relationship, we want it to be mutually conducive beneficial.”
For Wing Shack the loyalty strategy is “treating existing customers with a velvet rope,” said Baker, and doing more programmatic messaging and establishing a one-to-one conversation with a customer based on purchase history and visit preference.
“Now we have specific messages going out and all of which is creating a better guest experience,” he said. “If we can track a customer journey we can have a better one on one message and scale without being invasive. [message/offer] Delivered via the customer’s preferred method it makes all the difference in the world. You’re able to stay one step ahead if you’re able to listen to the data enough.”
Mitya said the more a brand can know about the customer the “stickier” that customer becomes to the brand.
“How sticky is the customer to my brand and that, to me, comes from personalization. There is no point in having customer data if you’re not going to use it. It’s about focused, personalized, timely communication,” he said.
He shared how the company refreshed its Friendly’s restaurant brand into a “bright shiny fast casual young-centric location,” and that response has been strong, from both existing guests and new guests.
“At the end of day, it’s about how we market and use the data going forward. It will be critically important to understand what kind of experience the customer wants to have,” he said.
In regard to the future of first-party data and loyalty, he said the key is continuing to personalize the experience and use data to get to know the guest better, to anticipate needs and provide a more frictionless, convenient, timely delivery.
“Technology is only going to make that much cooler and much slicker in terms of what we’re going to be able to do.”
Registration is now open for The Fast Casual Executive Summit held Oct. 9-11 in Indianapolis. Click here to register.