Restaurants ring up Big Data to drive sales

Restaurants ring up Big Data to drive sales

We’ve said it before and odds are we will say it again – applications for our Disruptive Innovators can come from a number of areas, including ones that are less than obvious. Big Data and its use in the restaurant industry is such an example as those companies look to overcome flat traffic trends and drive incremental purchases. How? By knowing what your preference are thanks to Big Data, mobile apps, and loyalty programs, which allow them to notify you when your preferred items, or ones that match your profile, are on sale. This likely means more pop-ups for last minute, impulse item additions like the extra guac from Chipotle courtesy of DoorDash. And yes, Chipotle is in the process of rolling out its own loyalty program.

 

Data is emerging as a powerful weapon in the increasingly competitive battle for the restaurant consumer. An explosion of food vendors—and menu items—is giving diners more choices than ever. Some restaurants say using customer data to tailor menus to their tastes can give them a leg up.

“Total restaurant traffic is not growing, so anything restaurants can do to offer a better customer experience differentiates them from the competition,” says David Portalatin, a food-industry adviser at market-research firm NPD Group Inc.

Many restaurants collect customer data through their loyalty programs, which diners can sign up for online or via an app. (After customers make a certain number of visits, they earn points that can be redeemed for discounted items or at no charge.) But the data that companies collect through such programs offer a window into the habits of only their most loyal customers, who aren’t the ones they really need to convince to return. And there are limitations to some online loyalty programs: Restaurants that collect email addresses without logging specific purchases can only send out emails about promotions to the whole customer base. An email for half-priced Frappuccinos, for example, would be wasted on someone who only ever orders coffee.

By contrast, individuals’ purchases are easier to track on mobile-order apps. Starbucks Corp. realized that its mobile app, which had only been accessible to members of its Starbucks Rewards loyalty program, could be more effective if it were open to everyone. Starbucks had 15 million active Rewards members, but it had another 60 million monthly customers it knew nothing about. Starbucks in March opened the app to everyone.

Source: How Restaurants Are Using Big Data as a Competitive Tool – WSJ

Grubhub positions to do more for food delivery

Grubhub positions to do more for food delivery

 

Grubhub was one of the first companies with its mobile and online ordering platforms to disrupt how we order food takeout and delivery. The company continues to expand its restaurant offering, which now spans more than 80,000 local restaurants in  1,600 cities under its Grubhub, Seamless, and Eat24 applications. With sales up 50% in the June 2018 quarter, it continues to fend off competition, winning a space in consumer wallets due most likely in part to our busy schedules and certain aspects of our Digital Lifestyle.

Looking to further disrupt the restaurant industry and its reach, Grubhub recently acquired digital payment and customer loyalty program company LevelUp and began accepting PayPal’s Venmo – all to expand what it sees as its scope and scale in the delivery space.

 

Sales were up more than 50% in the second quarter and earnings more than doubled.

Despite competition from the likes of DoorDash, Uber Eats and even the formidable Amazon (AMZN), Grubhub continues to wow investors with its impressive growth.

Grubhub is also partnering with more big national restaurant chains as well as local eateries. The company announced a deal with KFC, Taco Bell and Pizza Hut owner Yum! Brands (YUM) earlier this year.

Grubhub may soon be able to add more chains following its acquisition of mobile technology company LevelUp, which was also announced Wednesday.

LevelUp helps restaurants develop digital payment services and customer loyalty programs. Bareburger, Chop’t and Potbelly (PBPB) are some of LevelUp’s more than 200 clients.

 

Source: Grubhub is winning the food delivery wars