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7 Ways Big Data Can Help Your Restaurant Increase Profits

In today’s analytics-obsessed environment, information is power. It is crucial more than ever to leverage data for the benefit of your restaurant operations. Observing your staff in action or crunching numbers isn’t enough. Tech services and software programs can sift through voluminous amounts of data and isolate critical patterns that are nearly impossible for operators to capture on their own, including real-time restaurant promotion tracking figures, server performance statistics and detailed customer profiles.

“At the end of the day, our models and data sets are not magic crystal balls that can tell our future,” says Fiona Zhu, director of analytics for New York City-based Junzi Kitchen. “They are more like mirrors and binoculars: apparatuses through which we can better understand where we are and where we want to be.”

The question is not whether big data analytics is here to stay – a 2018 forecast from Technomic predicts that data will soon “drive virtually every element of restaurant operations” – but rather which facets of your operations deserve the most vetting?

To get started, dive into these seven strategies for leveraging the invaluable data you already own, to reduce food waste, improve planning and increase restaurant operations efficiency.

1. FIND THE BIG REVEAL

Software from Avero gives the iconic Mary Mac’s Tea Room in Atlanta real-time access to all aspects of the business, from food and beverage sales to inventory levels and loss prevention warnings, on a single easy-to-use platform. Taylor O’Sullivan, the restaurant’s director of administration and marketing, says that Avero caters to “restaurateurs, not IT guys.” The team can check the status of VIP tables remotely, while managers can receive custom reports pinpointing the potential reasons for sales jumps or slumps.

2. AUDIT MARKETING EFFORTS

Generating buzz with a restaurant promotion can be the difference between a stellar month and subpar one. But how do you gauge a promotion’s overall effectiveness? At Lawry’s Restaurants, Inc., Marketing Vitals collects information – check averages, covers, average party sizes and sales – and then compares that data to the restaurant’s performance exactly a year earlier. Lawry’s Las Vegas location ran a promotion on National Administrative Professionals Day last year, giving away a free dessert to administrators who went to lunch with their bosses. “Our revenue and guest counts doubled during lunch on that particular day versus a year (prior) when no promotion was running,” says Rich Cope, Lawry’s director of marketing. “We decided to add all of our locations to the promotion in 2018.”

3. MAKE LOYALTY REWARDS PAY

Launching a loyalty program through e-newsletters, comment cards or email clubs is an inexpensive way to collect basic information, such as names, emails, birthday and phone numbers. The Fifty/50 Restaurant Group in Chicago uses Aloha Enterprise, the same product suite used to collect operational data. Since the program was initiated in 2011, Fifty/50 has amassed information from nearly 40,000 guests and converted first-time diners into regulars by offering an enticing perk: a $20 credit to loyalty cards during a guest’s birthday month. By rewarding people who spend a great deal during certain periods of time, Fifty/50 incentivizes them to return. “The loyalty program does not save on costs – it’s an expense. But we think it’s creating loyalty and putting butts in seats during slower periods,” says Fifty/50 co-founder Scott Weiner. “Our seasonal business declines are less severe, and our peaks are a bit stronger.”

4. EVALUATE ADVERTISING RESULTS

Weiner uses Google Insights, which is free if you use Gmail for business email, because its dashboard accurately monitors website traffic for all 14 of his restaurants. “I can see what’s working and what’s not with advertising and marketing,” he says. Recently, Facebook ads have consistently drawn people to his restaurant’s sites, even if he can’t tell if those visitors are making actual reservations. Fortunately, the same dashboard shows which ad placements are creating significant traffic. “I can tell our marketing firm to focus on specific outlets that we know drive traffic,” he says.

5. TIGHTEN PROJECTIONS

At Junzi Kitchen, data from its POS system, inventory platform and payroll are used to scrutinize sales. By cataloging sales, product performance, operational efficiency and marketing efforts, dynamic sales projections help Junzi order the right amount of food and schedule the right number of hours for employees, Zhu says.

Using restaurant technology to gather performance data on individual servers can also boost profits and help managers identify glaring deficiencies.

6. PROTECT YOURSELF

Data from food safety programs such as Foodsafe can help operators comply with complex regulations. Foodsafe provides real-time temperature monitoring with HACCP-compliant wireless temperature probes and manages hygiene and kitchen cleanliness by recording timestamps, location and accountability data for completing various tasks. If a fridge temperature is repeatedly dropping out of the legal requirements, or a supplier is not fulfilling their legal requirements, it’s easy to identify and fix the problem.

7. GEO TAG LOYAL DINERS

Pulling sales data from POS systems, surveys, focus groups, Facebook and Instagram also helps Junzi Kitchen compile invaluable demographic information.

“Based on who we think our customers are, we look at the demographics in the geographic areas of potential sites and evaluate the opportunity from our target customers,” Zhu says.

At their first two locations (New Haven, Connecticut, and Harlem in New York City), many returning customers were affiliated with Yale or Columbia. For their next location, Zhu used municipal data sets overlaid with OpenGIS information to understand Junzi’s capture radius, visitor percentages, and competition density.

“If we don’t rely on data to make business intelligence decisions, it’d be like shooting in the dark,” Zhu says.

Tools for Data Mining

AVERO – Point of sale (POS) software that applies a data-driven, problem solving approach in all areas, from server training and social media initiatives to labor issues and inventory management

BRINGG – A delivery logistics platform used by chains, including Panera Bread, to optimize operating time and cost; data points include average order size and returning customers

FOODSAFE – Apps and Bluetooth sensors record cooking temperatures, refrigerator compliance and cleaning tasks; faster than paper-based records to get kitchen audits ready

UPSERVE – Point of sale and processing restaurant technology company providing integral data and tools for analysis