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Q: Can you give us an overview of your current focus and the types of clients you work with?
Sarah: Right now, I have two main areas of focus. One is a startup that's looking at optimizing the customer experience for restaurant takeout and delivery, specifically around surfacing data and insights to restaurant operators to help them improve their operations and compliance.
The other is a consultancy called Special Sauce, where I work with restaurant, hospitality, and SaaS brands to optimize key moments along the customer journey with the goal of driving retention, loyalty, and overall growth. My clients range from fast food chains to golf courses and event venues.
What I really enjoy and feel I'm particularly skilled at is taking a holistic view of an entire customer journey, both physical and digital, and being able to pinpoint friction and areas for improvement. Restaurants and hospitality are especially interesting to me because they have these extended, complex customer interactions that are ripe for optimization.
Q: What are some of the unique challenges restaurants face when it comes to understanding and leveraging customer data for retention?
Sarah: One of the big challenges is data consolidation. Even within a single restaurant, you might have customers coming through the drive-thru, using a kiosk, ordering on a mobile app, or dining in. Pulling all of that data together to get a true 360-degree view of the customer and their various journeys is incredibly complex.
I have doubts that even the biggest chains are truly harnessing their data to its full potential in this regard. It's a hard problem to solve, but it's so critical for understanding your customers and tailoring the experience to their needs and preferences.
Another challenge is around defining the "ideal" customer from a retention perspective. Unlike coffee shops, where daily visits from the same person might be the goal, QSR restaurants generally don't want customers dining with them for every meal. So there's a balancing act of encouraging frequent, but not excessive, visits.
Q: Where do you see the biggest opportunities for restaurants to improve retention and loyalty?
Sarah: A lot of restaurants have gravitated towards loyalty programs as a kind of silver bullet for retention, but many of these programs were implemented without much personalization. They rely on fairly generic incentives and communications that don't necessarily align with an individual customer's preferences or behavior.
I think there's a huge opportunity to leverage personalization to make customers feel known and understood, similar to how Spotify has nailed personalized music recommendations. If a restaurant can track what a customer orders and use that data to inform targeted promotions or suggestions, that's so much more impactful than just blasting out generic offers for items they may never purchase.
The other piece that often gets overlooked is the physical experience. You could have the smoothest digital ordering and loyalty program, but if a customer then has a frustrating experience in the actual restaurant, that's what they'll remember. It could be something as simple as not having a changing table in the bathroom for parents with young kids. Restaurants need to think holistically about all the different customer personas and their unique needs across the entire journey.
Q: For smaller, independent restaurants that may not have big budgets for data analytics, what advice would you offer to help them get started with optimizing retention?
Sarah: The good news is that the landscape has really evolved in terms of accessible, affordable technology solutions for smaller restaurants. It used to be that having a custom mobile app, for example, was cost-prohibitive for independents. But now there are a number of great full-stack solutions that bundle POS, app, and other capabilities into a templatized package.
My biggest recommendation would be to focus on owning the customer relationship as much as possible vs. outsourcing it to third-party platforms. A lot of small restaurants will just stick a Doordash or Uber Eats link on their website and call it a day, but then they're missing out on valuable data and paying hefty commissions.
There are ways to steer customers towards first-party ordering, even if it's a simple embed on the restaurant's own site. That way, the restaurant maintains control over the customer data and experience. Even simple email captures can be hugely valuable for building out that direct relationship over time.
In Conclusion
Our conversation with Sarah highlighted the complex, multi-faceted nature of the customer journey in the restaurant industry, and the wealth of opportunities for brands to optimize the experience across touchpoints. A few key themes emerged:
- Data consolidation across ordering channels and customer interactions is an essential foundation for understanding and optimizing the end-to-end journey, but it remains an elusive goal for many brands.
- Personalization based on customer behavior and preferences is an untapped lever for driving loyalty and retention, moving beyond generic, one-size-fits-all loyalty programs.
- The physical experience cannot be neglected in the quest to optimize digital touchpoints; a frictionless app is no substitute for a frustrating in-store experience.
- Even small, independent restaurants can access affordable tech solutions to help them own the customer relationship and gather valuable data for retention marketing.
As someone who has worked with major brands like Burger King and seen the inner workings of ghost kitchens, Sarah brings a unique perspective on the challenges and opportunities facing the restaurant industry today. Her insights offer a valuable roadmap for brands seeking to harness the power of data and customer-centricity to build enduring loyalty and drive growth.