Archive for April, 2007

“On Demand” in the Restaurant World?

Posted on: April 12th, 2007 by Simon Carter & Daniel Darwood

For the last 15 years ‘the day job’ has been in the technology world. Computer technology and the corporate customer.

Like any industry there are fashions and trends but these are essentially wrapped around an unchanging core need – how to get ahead and stay ahead.

Since the dawn of entrepreneurship, technology has played a fundamental part in feeding the need: from a revolutionary breakthrough to the more endemic, evolving and re-modelling of the metaphorical wheel.

Today, corporate businesses scratch their heads about “customer relationship management.” Indeed they puzzle over the bigger picture of how to manage their perceived “on demand” business needs.

So what are these things? And what does technology do that is so clever and helpful?

Every business has customers. Without customers there is no business. A business produces a product or service, markets to customers and then services those customers.

There exist a few useful truths (in the corporate world) – its around 10 times more easy to sell to an existing customer than find a new one and a completely satisfied customer is around 80% more likely to do business with you again than a customer that is ‘just satisfied’.

First step – get as many completely satisfied customers as possible.

Customer relationship management tries to do just that – at the basic level capture all information about needs and preferences and ensure that there is a single point of reference for all combined dealings with the customer.

So for example – you have three separate products from your bank; a mortgage, home insurance and a current account. Customer relationship management dictates that it would not matter if I were discussing a new product (a loan), phoning up to complain about bank charges, receiving a mail shot about a credit card, or completing an online application for a business account – all the information about me would be at the centralised fingertips of the bank: Enabling the servicing of my needs effectively and efficiently and, importantly, selling me something more.

Does your bank provide this level of service? Guess not. Like me, you repeat and correct your personal information many times depending on who you are talking to in the bank and frustrating ‘glass walls’ exist between different product departments.

Still, ‘customer relationship management’ remains the goal.

This is not to be critical of banks. Banks are very big companies and have diversified their offerings slowly over time – each area of the business developing in its own silo. To bring these together into a single picture of the customer is a major challenge and with the aid of technology they are undoubtedly making significant progress.

The birth of the internet took this opportunity and challenge a stage further. The customer now wants to do business whenever and wherever they want. Twenty fours hours a day, seven days a week, anywhere in the world.

A few years ago, were probably the first to do some very clever customer relationship management in this space. “Hello Simon, here is your personalised home page of purchases and interests and here are a list of things other people bought who have the same interests as you”. Brilliant. One click shopping. Brilliant.

So how about applying some of this smart technology to the restaurant world?

Diego Masciaga, Restaurant Director at The Waterside Inn suggests that staff continuity is very important. “If someone comes in who is a regular customer and we ask for their name at the door that is not so good.” True. The strength of the brand lives with the personnel. And in the service industry this will never change. People buy people. I have not visited a single restaurant where this is not true. And les arts de la tables will always be critical to success. However, regardless of Michelin Stars the restaurant world as a whole is missing the customer relationship management opportunity. and are well established sites that market promotions restaurants wish to offer customers. Very good in so far as they go.

Should I log onto a restaurant website (and yes I should have to register) the site should interactively ‘know me’. When I telephone to book they should tell me whether my favourite table is available or whether there is an alternative that is well lit and has chairs with arms. They should know my typical wine budget so that the sommelier never creates unintentioned embarrassment. They should know when and what type of promotion to send me. They should know which dining times typically suit me best. And importantly for the restaurant, what their typical gross profit will be from my visit and how much they make from me over a year.

Further there are wider missed opportunities – The likes of Gordon Ramsay and Nigel Platts Martin own many high quality restaurants that deliver across the top to middle market of the Michelin spectrum. Surely if I visit La Trompette regularly, then a mail shot or a loyalty reward from Chez Bruce would attract my custom.

The loyalty card concept has been one of the longer standing byproducts of the search for delivering customer relationship management coupled with customer satisfaction. The 21st Century green shield stamps. Perhaps these still do not go far enough; I don’t want to log on to know what the store is promoting to all, I want to log on to know what the store is promoting especially in line with my purchasing habits.

While retail stores have become experts at delivering the schemes (in so far as they go), why not restaurants?

Should I visit Gordon Ramsay Royal Hospital Road three times in a year then I get a free bottle of champagne next time I visit Claridgesor if I visit The Glasshouse twice in a month then I get a two for one offer at The Square.

And what about capturing and encouraging ‘referrals’ – refer three customers to one of our restaurants and have a bottle of champagne on your next visit. From private golf clubs, to Sky TV to 3 Mobile this is well understood concept and practice. But not as yet with restaurants.

Unlike banks, that have responded to their evolving needs with technology, restaurants can really grasp the nettle. A relatively blank technology canvas. The likes of Gordon Ramsay and Nigel Platts Martin should know exactly how much I spend on their restaurants a year and everything about how I go about it. They should reward or encourage me accordingly.

I know this is one area with which my bank is all to familiar.