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Morning Briefing Strap Line
Fri 5th Dec 2014 - Friday Opinion
Subjects: Technology that improves the customer experience, routes into the family purse, misleading statistics and a reminder of the Christmas fundamentals
Authors: Kate Nicholls, Jack MacIntyre, Paul Chase and Stephen Waters

Venues that get technology right by Kate Nicholls

Twenty five years ago this week, I went to the cinema to see Back to the Future II. Set in the futuristic-sounding 2015, it promised a world of flying cars, hoverboards and, most worryingly, home nuclear fusion reactors. The closest the plot writers got to predicting our future was the watch that forecast the weather, and Nike are set to finally sell self-tying laces next year.
Clearly, the idea of a pocket computer which would allow you not just to speak to but also see and write to anyone in the world, while at the same time choosing where to eat based on an online review and getting there using real-time navigation, with street views as well as maps, was unimaginable at the time. But it is the biggest single technological change affecting not just our sector but our lives as a whole. We can monitor our health, check calorie content, broadcast what we think about our experiences and, at the end of the night, contact a nearby taxi and watch it travel towards us in real time.
When it comes to technology I’m a (reasonably) late adopter but a very enthusiastic one, and I’m also childishly excited when it works and makes the experience better. I recently attended the Peach 2020 Conference and found myself in firm agreement with Vanessa Hall of YO! Sushi and David Campbell of Wagamama, two of the best users of technology to make the guest experience better, who were clear that, just because the technology can do something, doesn’t mean we should use it. Above all, technology has to enhance, not get in the way of, great customer service.
Royal Caribbean may have installed the first robot bartender, which can shake, stir, muddle and serve any drink on the menu at the speed of two drinks per minute, and Sydney boasts the first waiter-free restaurant, where diners order, collect and pay for their meal on screen. But to me, that is not what eating and drinking out is all about. It is about theatre, experience and social interaction and no computer can ever deliver that.
So here are some of the places and technologies that I think do get it right:
• Armchair ordering: One of my favourite places to eat is Bob Bob Rickard. Not because of the food, but because of the simple button to press to get champagne on tap. It’s not hi-tech, it is just a little light to summon the waiter to top up your glass, but it makes for seamless service and old-fashioned theatre. Given that, it is perhaps not surprising that I have taken to using Orderella as enthusiastically as I have, not just for avoiding the long stand at a busy late-night bar, but more importantly to have the coffee and soft drinks ready when I go out with the kids. Anything that streamlines the ordering process for me is a winner.
• Payment plus: At the other end, I think many are missing a trick in not speeding up the payment process. Contactless payment is designed to make customers’ lives quicker and easier, so why are so many bars surprised when you want to use it and why do they never seem to have enough portable payment terminals? Equally, given that most of us pay by card, surely it would be sensible for waiters to bring the card reader with the bill? At the more inventive end of the spectrum, earlier this year Individual Pubs became the first bar chain to allow customers to pay with the new digital currency Bitcoin: the till displays a QR code, which you scan with your smartphone, something which is likely to be more prevalent, as the government is consulting on its use.
• Virtual tablecloths: While I’m not a fan of online ordering when it totally removes human service, Inamo is a great example of how it can be integrated into a restaurant setting. Arguably the most hi-tech restaurant, in London it puts the technology right on the table, with clickable menus, underground maps and even games of battleships being projected.
• Sound and vision: The new celebrity Park Lane nightspot Le Peep Boutique uses futuristic Samsung technology to create mood and atmosphere. The LED ceiling, the first in the world, comes to life with pictures of Paris by night – almost like in Hogwarts. Las Vegas’s Eyecandy Sound Lounge uses iPhone technology to allow you to send song requests straight from your phone to the DJ – or even to send texts to other customers! Tokyo’s Graffiti Bar features an interactive wall which allows customers to change the decorations in the bar, browse digital menus, play games and access advertising and promotions. It’s decoration with a purpose.
• Storage solutions: Finally, technology doesn’t have to be fancy or customer-facing just to change the customer experience. One of the best uses of technology I saw recently was a very functional one. The Jones Family Project in Shoreditch, East London uses it to swivel round their shelves, allowing a daytime coffee-and-tea shelf display to become a well-stocked back bar at night. A quick but easy design solution. Let’s use our technology to help us do what we do best – and leave the robot bar tenders at sea!
Kate Nicholls is chief executive of the Association of Licensed Multiple Retailers 

Routes into the family purse by Jack MacIntyre

Families are essential to the make-up of the out-of-home market, accounting for 29% of all out-of-home visits, 32% of all out-of-home sales, and spending on average 72p more per person per trip than adult-only visits. Not only do they provide a significant proportion of sales and visits, but families also drive growth in the market. The overall visit growth of families, 3% higher, and sales growth, 6% higher, in the latest year, against below 1% growth in both metrics for adult-only visits, underlines the importance of appealing to this key demographic. 

Splitting the market by channel, it becomes clear that where a channel has performed well, this positive performance has been driven by families. QSR, casual dining, and branded pubs exemplify this, with 63%, 100% and 90% of their respective total growth accounted for by families. These are the three channels that also over-trade the most among families, with average share of visits at 29%; QSR, casual dining and branded pubs rely on families for 39%, 52%, and 42% respectively of visits. Surviving and thriving in a challenging marketplace for these three channels can be directly linked to their operators’ success in research and innovation; providing an increasingly attractive offering and experience to families.

Despite the increasingly encouraging economic news in this country, families are still facing a cost of living issue (or “crisis”, if the tabloids are to be believed), as wage increases remain behind inflation, and the average man or woman on the street is unlikely to yet be feeling the positive effects of any macro-economic recovery. This uncertainty filters down into the way that families behave in the out-of-home market. Presented with a wide choice of outlets, shoppers are increasingly choosing well-known chains over independents.

In the year ending June 2010, families made 1.3 billion visits to independent out-of-home outlets, accounting for 44.2% of their overall visits. This number has fallen by more than 100 million visits between then and the latest year. Over the same period, visits to chains have grown by more than 300 million, with families now visiting chains for 62.2% of their out-of-home visits. In a time where their visits to the foodservice market are likely to be either reduced or at least much more thought-out, families are clearly looking for familiarity and reliability in their forays into the market. Chains offer a consistent – if at times generic – proposition, which removes any risk associated with these eating and drinking out occasions. 

Taking a common-sense, but perhaps overly optimistic view of human nature, one would presume that we would be more conscious of the need for healthy food and drink when with our children compared to when we are without them. Looking at figures for the out-of-home market, though, the opposite is in fact true. Health was cited as the primary motivator for visiting the out-of-home market on 4.5% of all occasions, but 4% of family occasions. “Treating myself/kids” was cited as the primary motivator in 16.6% of all occasions, and 27.6% of family occasions. Clearly, health is not quite as important overall as we all may assume, and the fact that this actually decreases when we are with our children signposts a number of interesting points.

If we use many supermarket chains’ much-maligned strategy of placing tempting sweets and confectionery right next to the tills as the beginning of an analogy, then we can start to explain a few reasons behind what is going on. The primary battle, even for parents who set out with good intentions, is between health and treating, or, translated into more pragmatic terminology, effort versus ease, and expense versus affordability. When with a child, faced with a wait in a supermarket till queue behind a doddery old dear purchasing what appears to be their whole year’s groceries, and your child flanked by walls of sugar-based temptation, “health versus treating” begins to very quickly break down into a more simple question of effort (health) versus ease (treating). This is also true in the out-of-home market, where pester power is a huge part of a market which, on the face of it, is not traditionally thought of as a child-focused environment.

“Because my kids like it there” was the primary reason for consumers picking their chosen out-of-home outlet in 24% of family visits. Ultimately, this tells us that children get their own way in a quarter of all out-of-home family visits, a very substantial figure, equating to more than 774 million child-chosen visits each year. Contrasting this to the health motivation again, produces a difference of more than 640 million visits between the two. Clearly, it is easier, and more common, to eschew health in the face of pester power. As alluded to previously, there is also the not-insignificant cost-factor in consumers’ minds to consider when talking about health, treating and family visits out-of-home.

Healthy food is viewed almost universally as being more expensive than non-healthy offerings. A study by the Harvard School of Public Health in December 2013 found that, in the UK, eating healthily added an extra £1,460 to the grocery bill of a family of four. This is a lot of money to struggling families, but according to the study’s co-author Dariush Mozaffarian, “while healthier diets did cost more, the difference was smaller than many people might have expected.” 

Continuing this theme of slight surprise, but looking exclusively at the out-of-home market, when we break down what consumers spent on different “missions” in the out-of-home market, we see that eating healthily is in fact rather kind on the wallet. Consumers who cited “I wanted something light/balanced” as their motivator for visiting the out-of-home market with their children spent an average of £4.25 per person in that visit. This £4.25 per person when on a “health mission” with children actually represents the lowest spend of all mission motivators; well behind the £6.35 average for “socialising”, or £4.91 for “treating”, and just behind £4.33 for a “functional” visit. This is not, as one would perhaps immediately expect, driven by consumers purchasing fewer items on these health missions; the number of items bought is second only to socialising missions. Clearly then, it is consumer perceptions that need to be addressed, continually and consistently, in order to persuade parents that eating healthily with their children is not restricted to a home-cooked meal or a trip to an expensive organic eatery. Celebrity chefs have gone some way to addressing this issue in the in-home sphere, but perceptions are still way off. The lack of real compelling evidence of this education happening in the out-of-home market looks to be driving at least part of the low motivation share that we see for health missions.

Operators and suppliers taking a pragmatic viewpoint need to be fully aware of the fact that the out-of-home market is very different from the in-home grocery market with regard to families and their motivations for visiting retailers/outlets and purchasing products. As Paul Kruzycki of Ale by Mail has recently commented in relation to beer, “[people will] drink what they want, when they want it, and it’s all about quality and provenance, not what the health lobbyists … want them to drink.” It may be painful to say, but health is just not that important a consideration out-of-home: it is a mitigating factor, not a decision-driver.

Although the economy looks to be picking itself up out of the mire, families wishing to scrutinise and justify their out-of-home visits see treating, socialising, and having fun as reasons, drivers and motivators for visiting out of home. Generally (and there will obviously be some exceptions to this) health is just not a part of this lexicon, and is instead being seen as something of a necessary evil, which is achieved more cheaply and easily through the grocery shop.

Clearly, when going out as a family, we are likely to be aware of the increased cost involved. It will come as no surprise, then, that families over-index in their use of promotions; some sort of deal or promotion is used in 36% of family visits, against 25% of adult-only visits.

The promotions that we have become accustomed to in the grocery market, chiefly penetration-driving price reductions, are on the decline in the out-of-home market, with meal deals increasingly coming to the fore. Meal deals are arguably the widely used promotion that comes closest to fostering a mutually beneficial relationship between operator/supplier and consumer. 

In theory at least, the operator/supplier is able to gain a larger average spend from each trip, invaluable in a market where the frequency of these trips remains under pressure, without the pain of self-imposed deflation that comes with outlet-wide price discounts. Consumers feel they are getting a good deal – and they are – with their whole meal occasion conveniently priced up for them, and with a nice volume discount to top it off. It follows, then, that these meal deal promotions are hugely popular with families.

Meal deals are used in just 11% of adult-only visits, but 25% of family visits. This represents an increase from the share of meal deals in 2010 in both cases, with adults using meal deals in just 7% of visits in YE June 2010, and families in 24% of visits in the same period. The stability of this figure for families over the past five year, despite the increased breadth of meal deals on offer, will be good news for players in the out-of-home market concerned about an escalation of promotions. The “quality” of the deal, combined with a smattering of the factors already mentioned in this piece will represent the key visit driver, rather than a whopping great price discount, or a huge array of different deals. This links in with the increasingly subjective nature of “value”, which no longer just means “cheap prices”. Consumers in both the in-home and out-of-home markets have an ever-expanding pool of factors which are totalled up to form the classic “value proposition”, and they are becoming ever more vigilant of any offerings which do not fit this.

As an operator, offering a compelling meal deal is clearly a real pull-factor for families choosing an outlet to visit, allowing them the freedom to listen to “pester power”, treat themselves and their children, but all while keeping a close eye on the purse-strings – or at least offering consumers the impression that they do.

Overall, the influence of families in the out-of-home market is huge, and shows no sign of slowing. They drive visit growth, they spend more when they do visit, and they are increasingly demanding in their choices, habits and motivations. Families’ need for a treating experience, often at the expense of a healthy alternative at the moment, can be combined with other needs states in one visit. Treating does not have to mean “unhealthy”, and healthy does not have to mean boring. Some operators in casual dining and branded pubs, in particular, have really seized upon this multi-need mission, and have seen their visits and spend grow accordingly. Families’ promotional focus needs to be seen as an opportunity, rather than a hurdle (as is perhaps a widely held view in the market), since gaining their approval, their custom, and ultimately a share of their wallet is increasingly important in an out-of-home environment where regular and lucrative visits are at a premium.
Jack MacIntyre is an account manager of UK foodservice at the NPD Group

More misleading statistics by Paul Chase 

Writing on Alcohol Concern’s website just before its annual conference on 19 November, the organisation’s new chief executive, Jackie Ballard, had this to say: “Alcohol misuse not only hands a hefty annual bill of £21bn to UK taxpayers, it also has a huge detrimental impact on local communities.” £21bn cost of alcohol misuse to the taxpayer? Oh not that hoary old canard again! This number, which has been repeated ad nauseam by every politician, and every public health sock-puppet in countless echo-chamber “alcohol and health” conferences, is based on a Cabinet Office study conducted in 2003. Actually the original number is £19.7bn – but add a bit of inflation and some rounding-up and you get to the £21 billion figure – what’s a mere £1.3 billion error when you’re trying your best to tell lies in a noble cause? 

Take a look at the graphic below:

What is clear is that the only costs to UK taxpayers are those related to healthcare costs and the public costs of alcohol-related crime and fire, which equal £3.9bn, not £21bn. One of the biggest categories of harm, in cost terms, is “intangible costs of alcohol misuse”. This is an imagined cost to individuals of pain and suffering arising out of alcohol misuse. But you cannot rationally consider costs without also considering benefits. What, for example, is the intangible benefit of moderate alcohol use? And if we subtract that number from the alleged intangible cost of misuse do we end up with a net cost, or a net benefit? Even to ask this question is to expose the utter absurdity of trying to monetise personal pain and suffering, or for that matter the monetary benefit of alcohol-fuelled good fellowship or a successful flirtation!

Then Ballard goes on to talk about “Dry January”. She assures us it is “not a fundraising stunt”, but a scientifically validated way of getting people off the booze: “We will also be launching Dry January 2015 and the University of Sussex, who have been researching the long term effects of Dry January on participants, will be at the conference to talk through their findings. We already know that 81% of the 17,312 people who took part in Dry January 2014 said that, as a result, they would continue to reduce the amount they drink. Staying booze-free for 31 days also helped them lose weight and sleep better, gave them more energy, saved them money, as well as giving people more confidence to turn down an alcoholic drink in social situations.”

But how independent was this piece of university research, and how true are the claims Ballard makes? Well, it has to be a somewhat suspect piece of research given that the University of Sussex’s initial announcement of it reads like an advert for Dry January, complete with a Dry January logo and a link to sign up to it. 

Of the 17,312 people who took part in Dry January in 2014, 3,800 completed a survey before they started the month – 22%. However, by the end of the month only 1,600 chose to take part in the follow-up survey, which is just over 9% of those who took part as a whole. By August, when the follow-up study was completed, that number had dwindled to less than 900 – so just over 5% of those who took part. The research goes on to say that 4% of this 900, which is just 0.2% of the original 17,312 people who took part – all of 36 people – were still not drinking at the six-month stage. Result! Dry January works, it’s not just a fund raising stunt, honest.

This is what happens when scientific research becomes the creature of a public health ideology that has no regard for the truth, and for which lying by statistics is morally justified if done in pursuit of a “noble cause” – a healthist elite bent on saving an ungrateful populace from the evils of alcohol. It’s a latter-day form of noblesse oblige! 
Paul Chase is a director of CPL Training and a leading commentator on on-trade health and alcohol policy

Making the most of Christmas: top tips for surviving the festive period by Stephen Waters 

Love it or hate it Christmas is here again: arguably the most critical time of year for the restaurant and bar industry. The bookings schedule is crazy, the clientele is demanding, the chef is on his knees and the staff are either burned out or partying hard.
How to survive and, importantly, how to enjoy it? Well, Christmas is make or break for all of us. It’s easy to get caught up in the frenetic pace of work and forget about the all-important team element that can make the difference between good takings and outstanding takings. Here are my tips to help managers, in particular, make the most of the festive season:
1.  Have a plan and share it with the team. It sounds obvious, but the busier the time, the more planning required. Have a spreadsheet up on the wall showing clearly when all the bookings and parties are (and keep it updated), so that everyone knows what’s coming and is ready for it.
2.  Brief well and manage expectations. Make sure all the staff have “bought in” to working extra hours over the busy period. Let them know it is going to be hectic and full-on but fun.
3.  Show strong leadership: keep calm and level-headed. The team will take their lead from you. “If you can keep your head when all about you are losing theirs …” is a good mantra for this busy period.
4.  Be supportive. This is the toughest time of year for staff. Be there for your team, give them extra support when they need it and remember: it’s Christmas for them, too.
5.  Small things can make a big difference. Keep up the one-on-one conversations with each team member, and keep them positive; save the development needs for January.
6.  Don’t forget to look after yourself: Try to keep an element of work-life balance: eat well, get enough sleep and make time for friends/family once a week, even at the busiest times.

7.  Have patience with your customers: “Tis the season to be jolly …”, and a little leeway with your more tipsy customers goes a long way. Friendly staff means happy customers who will spend more and tip more, which means staff will be happier – and so it continues.
8.  Pace yourself and your team. It’s only going to get busier.
9.  Think about how many champagne flutes you might need – then double it.
10.  Enjoy it. Let’s face it, we love it. Thrive on the buzz and adrenalin, focus on the positive, enjoy the festive spirit and you will bring your team with you.
Merry Christmas!
Stephen Waters is founder and managing director of the management training company Watershed School. He has worked with the likes of Hawksmoor, Spring at Somerset House and Loungers. From its central London location, Watershed runs development programmes at three levels: director, general manager and supervisor

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