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Morning Briefing Strap Line
Fri 28th Aug 2015 - Friday Opinion
Subjects: Restaurants and technology, tips and the pinnacle of brand and operational excellence
Authors: Glynn Davis, Mel Joseph and Ann Elliott

Restaurants and technology by Glynn Davis

Inamo is a restaurant that has long been at the cutting edge of using technology. Back in 2008 when it opened its doors in London’s Soho, mobile payments and apps on smartphones were new out of the blocks but this did not deter the co-founders of Inamo in fully committing to bringing IT to front-and-centre of the restaurant experience. It undoubtedly helped that one of them, Daniel Potter, was the son of the inventor of the Psion handheld organiser in 1984 (this was real pioneering use of technology that arguably helped paved the way for today’s mobile devices).

At great expense they used specially adapted overhead projectors to deliver an image onto the dining tables that when combined with interactive technology enabled customers to view menus, order their food, play games, and via a webcam take a peek into the kitchen to see how their noodles were coming along. As the years have passed and technology has become ever more acceptable to the general public in the eating environment, Inamo has – rather surprisingly – remained out on its own in its use of IT. Since Soho it has since added a second site and current reports suggest a third restaurant opening is imminent. Maybe it has simply been an experience that is best suited to experimenters in central London.

Things could be about to change if Pizza Hut’s activities are anything to go by as it is also developing an interactive table that enables customers to construct their own pizzas from various selections and then send the order direct to the kitchen. It is also rolling out a digital “Subconscious Menu” that tracks customers’ eye movements when they scan the menu on a tablet device and automatically determines their ideal order. Apparently it has a 98% success rate but rather sensibly diners can still override the recommendation and select manually.

This sort of initiative is clearly ill-suited to many customers because surveys suggest people don’t want such technology to be thrust into their faces in restaurants. A recent report by Sacla found 37% of adults aged over 35 do not want restaurants to use front-of-house technology, instead preferring the more personal human experience to prevail when dining out. The interaction between customers and staff, and maybe a bit of banter too, is regarded as integral to the experience. It would seem people are fine with being glued to the screens of their own devices in restaurants and cafes but woe betide any operator that plonks their in-house technology such as iPads to automatically take orders and for making payments etc in front of diners.

This is certainly borne out in the number of interesting technology developments taking place in the restaurant industry that centre on people’s own smart devices rather than a restaurant’s. The recently launched Retail Insider Digital Retail Innovations 2015 included a clutch of food and beverage apps including Starbucks’ Pay-ahead, Busaba Eathai’s MyCheck payment solution, and the Rapid Q pre-ordering app that has been used at the Aviva Stadium on match days. As mobile devices have become part of the general public’s way of life and payments on smartphones are finally starting to gain some traction – fuelled to a large extent by the launch of Apple Pay – then there will be rapid development of even more innovative and useful apps being launched by food operators.

One impressive example is from Taco Bell in the US, which launched an order-ahead (and pay) app to help speed customers through its restaurants. Credit card information is pre-stored so after simply swiping and selecting from the menu, a press of the “submit” button is all that’s needed. The clever bit is that through geo-location technology the customer’s location is monitored to ensure that their order is only fulfilled when they are 500 feet from the store thereby enabling the food to be freshly prepared and hot. Actually, the really clever bit is that the average value of an order made via the app is a whopping 20% greater than those ordered in its stores. This is because the app makes it particularly easy for people to peruse the full menu and add little extras onto their tacos such as additional sauces. And they maybe do not feel quite so guilty bulking up their orders when doing it electronically. Either way, it has certainly juiced Taco Bell’s sales this year and positioned it well in the eyes of its core young digital-native customer base.

What was interesting from the Sacla research is that of the 18-34-year-olds surveyed, a lesser 32% did not want front-of-house technology in restaurants. And I’d guess that the percentage would be significantly lower for the under-18s if they had also been questioned. So while the future appetite for Inamo-style full-on technology in restaurants remains to be seen, what’s clear is that chips of the micro variety absolutely have to be on every food and beverage operators’ menu in some format or other.
Glynn Davis is a leading commentator on retail trends

Where should tips go? Let the customer decide says Mel Joseph

The debate on where service tips should go has hit headlines again this week. Yet the answer seems very simple. Let the customer decide. The debate isn’t really about the scrupulousness of companies “taking” cash. 75% of the restaurant groups surveyed by The Guardian ensure staff receive 100% of tips and service charge; the other 25% charge 10% or less on card transactions as an administrative fee. Whatever your view on the percentage and the right to deduct admin fees, the debate really ought to be about the 90-100% that is given to staff and how that gets fairly distributed.

Service charge or voluntary tipping is supposed to be the customer rewarding good service. So then, tipping needs to be used in a way that a) improves customer service and satisfaction and b) motivates staff to want to do better whilst of course maintaining the team dynamic. Having spent 20 years in a service background, if there’s one thing I know makes staff deliver great customer service, it’s a great incentive. In turn, the quality of service received should be the customer’s reason for choosing the venue. Many hospitality venues incentivise customers to return by offering a freebie but by switching and putting the focus on the service, businesses will reap greater rewards.

From a customer’s perspective, if I go into a hospitality venue and have a great customer experience, it is the staff that have made my customer journey positive that I want to reward. I want them to know that their efforts have made a difference. What I struggle with is not knowing where my money goes once I hand it over, because I want to make that decision. Offering a fair basic salary that is topped up through rewards based on a great performance has worked across retail, finance and other sectors. Incentivising staff increases morale and delivers exceptional service because the staff are happy which in turn creates happy customers. Happy customers come back again, and so the business grows. Customer service and incentivised staff are a symbiotic relationship. Performance has to be rewarded and customers should have a say on that performance.

How that performance is measured though has remained a challenge. What is a fair distribution of service charge and cash tips? In many companies’ opinion, it is more equitable to spread tips evenly believing it is the whole team’s efforts that give rise to good service. With the controversy in the press this week, consumer website moneysavingexpert.com is running its own poll asking subscribers where tips should go. Interestingly the results so far are that 91% of 7,500 responders believe their tip should either go to their own waiter, or shared equally amongst the restaurant staff (including kitchen and cleaners); the poll is equally divided between the two options.

Unfortunately, the website hasn’t offered all the options, listing only the choice for the tip to go straight to my waiter/waitress; split between all waiting staff; split between all restaurant staff; direct to the restaurant if it contributes to higher wages; direct to the restaurant to treat it how it wishes; I never tip. What they missed was “reward the staff who contributed to your customer service”. And for me the result would have been a no brainer. I firmly believe the customer journey is touched by more than just waiting staff, and therefore, staff rewards should be available to the whole team – but paid to those who perform best. So we need a middle ground where the customer decides, but the opportunity exists to pay more than just the waiter.

The problem in hospitality is the complexity of operations and an embedded belief that whoever served the table (or collected the customer’s money!) gets to keep the tip. I remember a friend telling me of her days as a waitress 20 years ago, where the staff fought over their Saturday Mr “Dom Perignon” regular with his £20 tip. That one table out tipped all the others put together and so guess who got the best service? This gave the chance to reward staff who were poor performers overall, but got the right customer. No surprise the business was bankrupt within two years.

At Howya we have developed a customer service programme that allows customers to rate staff and allows businesses to put a reward system in. Some of our clients use this system to attribute tips against best customer service performance – and with over 90% of customers giving instant feedback, it really works for them. The system works by the customer answering five questions on a tablet device at the point of payment, the system knows who is on at what shift, and calculates what part of the “pot” each member of staff should receive dependant on the customer feedback. Customers are effectively deciding where tips and service charge go but in a really hard and fast, fact driven, fair way. I firmly believe the hospitality industry has the opportunity to put the tipping controversy to bed. Whatever solution you find, lets get back to the heart of tipping and let the customer decide.
Melanie Joseph is head of sales and marketing at Howya, the at table ratings system

The pinnacle of brand and operational excellence by Ann Elliott

The Wild Rabbit in Kingham (www.thewildrabbit.co.uk), which I stayed in last week, is one of the best examples of excellence in this sector I have seen for a long time. I know that there are brilliant five-star hotels and restaurants out there but I know few in the pub/restaurant sector that could beat this place for food, service, attention to detail, ambiance and overall experience. We went to celebrate our wedding anniversary though so perhaps the occasion did have something of a rosy glow about it, looking back This sense of informal but accessible luxury does come at a price however with our room costing £300 and the meal hitting over £150 for the two of us.

The reception area was well signposted, smelt divine (there are candles all over the place) and manned by a truly delightful team member who took us personally to our room. A welcome contrast to the “here is your key, you are on the seventh floor and the lift is round the corner next to the toilets” approach, which is the norm in too many places. I can visualise the bedroom now as I write. Entry into a small “sitting room” with sofa, TV, fridge (stocked with pink champagne amongst a host of other drinks) and a range of DVDs (a box set of Cary Grant movies was a bit of a strange choice – does anyone ever stay there long enough to watch a whole box set of anything never mind Cary Grant?). It’s the main bedroom picture on its website.

The bedroom itself was beautifully furnished and finished including a four-poster bed, chaise longue, leather chair, cushions, big wardrobe, beautiful lighting, a selection of interesting books and white robes. The whole feeling was one of comfort and relaxation without being so luxurious that it was intimidating. The bathroom was huge with a vast supply of fluffy towels, soaps and toiletries. And, importantly, a bath in which to drink said pink champagne and read aforementioned books. It had a great shower too. Very few hotels and B&Bs do both well. The attention to detail on all the finishes was really incomparable with absolutely no expense spared on anything.

The meal was divine in every area. I had the slow cooked hens egg, peas, ham hock and warm pea velouté (£9.50) followed by line caught cod, peas, girolles and cucumber and horseradish emulsion (£24.00) and then cherries, white chocolate, hazelnut granola (£8.50) accompanied by Familia Zuccardi, Torrontés Tardio, Mendoza, Argentina (£5.00) – you can see how the bill adds up. The food was immaculately presented by just lovely servers who had that right mix of professionalism and friendliness to make you feel at home but also special at the same time. Of course breakfast was just as wonderful – accompanied by the day’s papers.

The next day we went to the Daylesford farm shop and café which is just heaven for any foodies (www.daylesford.com). As it says on its website: “Our iconic farmshop takes full advantage of its location; vegetables, fruit and herbs are picked each morning from the market garden and go a few yards into the shop and to our chefs in our award-winning cafe. Next door is our dairy and creamery, our farm kitchens and our organic animals, who roam freely on the surrounding organic pastures.”

I just loved the passion and dedication evident in every element of this brand – you know what it’s about just from picking up a product and reading the label. Everything is totally aligned and perfect. Whilst Carole Bamford (www.carolebamford.com) obviously married a man with means, it’s her drive and enthusiasm that is in evidence throughout this wonderful brand. She patently had a vision she has been determined to bring alive. I loved it all.
Ann Elliott is chief executive of leading sector public relations and marketing firm Elliotts – www.elliottsagency.com

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