Restaurants are in the electronic distribution business now.

Restaurant Terrace Tables
MARK FANCOURT

Embracing the principles of electronic distribution and management into your restaurant operation.

One of the exciting and valuable developments over the last couple of years is the digitization of the restaurant customer experience and electronic distribution. The advent of the of the COVID19 pandemic has accelerated the behavioral shift to the point that the restaurant industry is now taking the steps to meet the digital customer.

Tables, Menu’s and Electronic Distribution

Predominately we are seeing the adoption of the digital ordering process in a multitude of fashions. The capability begins with 3rd party ordering and transgresses to direct ordering, right through to self-service kiosks and on table devices as well as apps using digital menus.

The other phenomenon that has arisen through the COVID19 pandemic is space optimization. With reduced seating capacity and the necessity to make a dining reservation as determined by regulation or operational need to maximize space online table reservations have also increased in importance. In fact, Datassential found that 50% of diners want online reservations. OpenTable found the 65% of customers would dine more regularly if they could choose seating preferences.

These changes have driven a demand for technology adoption at a rapid pace. Although the underlying importance of these developments will have a long-term positive impact to an industry that has been hammered by the pandemic.

Learning electronic distribution from the industry

If we observe the broader hospitality industry the business of electronic ordering and booking is deeply rooted in business operations. In fact, it is not possible to consume product or service without making a booking. Either in advance or upon arrival. When was the last time you stayed in a hotel or took a flight without a reservation? Usually in advance. Usually prepaid in full.

These industries would not operate in any other fashion. The reasons driving behavior is the combination of forecasting, sales of perishable inventory, pricing optimization and detailed customer information. This information is the cornerstone of these sectors of the industry.

Riding on the back of a trained customer, the restaurant industry now has the opportunity to embrace the business of electronic distribution. Smalls steps have been made into the discipline but there is so far yet to go and so much opportunity.

At an industry event not all that long ago, I sat in a session with restaurant operators where the topic on the table was, ‘which 3rd party ordering platform should I use’. It was an interesting dialogue for me coming from a background of hotels, distribution, and revenue management. The group was discussing the merits of each potential partner. Whereas my answer was to use all of them.

Embracing the digital marketplace

This is the business of distribution. The principle being that the further you can expose your product the higher chance of conversion to sale. As hotels, airlines and other related businesses understand every channel brings its value. Although each channel must be managed. Even more importantly you must have your own direct channel. Something else the restaurant industry is coming to terms with.

It is an exciting time for restaurants as the distribution stage of industry development is just beginning. Restaurants have both tables and menu items to present across an electronic marketplace and each has similar and unique challenges. It is an extremely valuable opportunity to leverage customer behavior with online platforms to improve customer knowledge, interactions and increase custom and retention. This is the platform for a better business environment and stability for restaurant as the behavior becomes established and distribution expertise increases in the restaurant industry.

A time is fast approaching where technology enablement in the front and the back of house will create circumstances to support incremental revenue opportunities via real time pricing optimization and table and space inventory pricing based upon demand. But only if industry embraces the shift.

Let’s talk about electronic distribution and how FOODnBEVTECH can help you establish your electronic distribution environment using technology to expand the presence of your restaurant.

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