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Morning Briefing for pub, restaurant and food wervice operators

Fri 15th Jun 2018 - Friday Opinion
Subjects: What Einstein can teach us about customer experience, don’t stuff up selling turkey this Christmas and retail-style agreements
Authors: John Upton, James Hacon and Ann Elliott

What Einstein can teach us about customer experience by John Upton

In his book, The World As I See It, Albert Einstein wrote: “The most beautiful experience we can have is the mysterious.” For those not able to embrace this, Einstein considered them to be “as good as dead”. Now death, I appreciate, is hardly the most positive theme or smile generator to be kicking off this article. Unless, that is, you are an undertaker, taxidermist, tax collector or coffin maker – the list goes on.

Getting back to the land of living, there may be more life in Einstein’s words on embracing the mysterious than we might at first think. Einstein was not all about science and his famous relativity theory, he also used his considerable brainpower to comment on a range of topics including politics, religion, art and philosophy. Through this thinking, he provided alternative perspectives to challenge us to reconsider conventional wisdom and why things are the way they are.
It’s this Einstein challenge that continues to inspire me. On this occasion, he made me think again about one particular element of the customer experience toolkit – mystery shopper programmes. A recent conversation on these programmes triggered a debate about their validity and value. Yes, they can add value without doubt but they also might not.

The conversation began around programmes that are carefully and deliberately designed to capture only specific elements of a customer’s experience. Such programmes focus on a narrow range of products, operate at limited times and only comprise a small amount of shopper visits.

Targets are put in place and metrics are set up to hold operators to account. The feedback is then collected, extrapolated and used to identify and highlight current trends or validate plans. Sometimes the feedback is used to challenge or ratify head office perceptions of what’s going on in the real customer world. Once analysed, the output might also be used to shape strategy.

Those in favour of this type of approach will readily seek to demonstrate the value that has been created. Trends will be produced to show how the customer experience has improved and how the programme has driven the business forward.

Operators will be praised having delivered on the metrics and, through its halo effect, the programme will be deemed to have had a successful impact on the overall customer experience. I can see the logical value of this approach. However, like the good scientists (or perhaps philosophers) we are, let’s think about this approach a bit more.

You target and focus activity in your business. Get it. You can show you’ve made progress with your customers. Yes, I agree. However, who has determined what it is that should or should not be measured? How much is the customer actually at the forefront of this decision? Who in your organisation is ensuring all customers will win from the programme, both in terms of implementation and output?

Don’t forget we humans are clever. Staff members soon get wise to what’s expected with such “limited programmes” and we’re quickly into the world of a “gamed” programme. Too often, an “experience switch” can be flicked and the customer experience changes altogether when a programme window opens and closes. Sadly, it’s not always for the better – particularly when a bonus or incentive is linked to performance.

When you do take time to digest this, are you really willing to accept differing levels of customer experience in your business? Does that work for you as a customer yourself? You are also potentially basing strategic decisions on only a fraction of the total customer experience delivered by your business. Are you really getting enough customer reality into your thinking? Would you build your own house on such sandy ground?

What do I conclude? I believe there can be a good life for mystery shopper programmes in today’s world – but only when they are wholly mysterious and can’t be gamed. These are programmes that are implemented by shoppers able to enjoy the full range of what you have to offer to all your customers – any time.

Importantly, mystery shopper programme insight and output must only be used alongside other streams of customer feedback – never in isolation. Blended, for example, with the customer views shared so willingly nowadays through social channels.

By keeping to this alternative theory of relativity, I believe you give yourself the best chance of creating the most beautiful experiences for your customers.
John Upton chairs a number of restaurant brands and works with iCustomer, using artificial intelligence to help businesses identify and meet their customers’ needs (

Don’t stuff up selling turkey this Christmas by James Hacon

In the coming weeks many groups will start firming up their Christmas proposition as they aim to beat the competition to those all-important early bookings. It’s a time that can be frantic in terms of signing-off menus, ensuring your creative is cracking and starting the outreach. At this time of year, effectively managing enquiries is vital.

We have seen an array of mostly London-centred groups drive significant growth through a concentration on pre-booked sales in recent years. However, it has yet to become a focus for many brands, big or small. It all starts with existing enquiries. Why spend large sums on promotional activity if you aren’t converting the enquiries you already receive, right?

I’ve seen the phone records of about 15 groups and, before starting work, not one has had a call answer rate of more than 50%. That means (repeat callers aside) at least half of the people who decided to do some kind of business with you haven’t been able to complete.

Many will rely on those people coming back, saying “they’ll go online”. That might be the case but personally I just call someone else. With the amount of competition around, it’s not a risk you should be taking.

When someone finally gets through by email, online enquiry form or phone, what happens next? How long does it take to get a response? Knowing I was writing this article, I asked one of my team to send ten enquiries for a table of 14 on a Monday night in August to London sites of well-known brands. We have been waiting 36 hours now and we’ve only had six responses. The fastest was two hours. Four of the six came back the next day. Crazy right?

I happen to be planning my wedding at the moment. I tried calling three restaurants to book an informal meal on the night before the big day for relatives travelling in. None could deal with my reservation there and then and all needed someone to call me back. Only one did. It was a Thursday night. What would a customer do? Go elsewhere! They might think you don’t need the business. What impression are you leaving? A terrible one. Personally, I’d actively avoid visiting any of them again.

It’s a real issue for our sector, which only becomes worse when times are tough. We put pressure on our operators to keep wages tight, which is likely to mean cutting back in some areas. This means fewer people to answer the phone, less likelihood the right person will be in to take group enquiries and, almost certainly, less time to answer emails.

What can you do to help your brand avoid these pitfalls? Here are some of my top tips:

1. Schedule communications at the right time. Don’t send out emails pre-lunch service when no-one is going to answer the phone, no matter how good the open rate is at 11.42am!

2. Set clear standards about time of response so everyone knows what is expected.

3. Train your team to handle enquiries effectively. One tip is to always call a prospect back rather than email them. It shows great service and often means it cuts out a lot of back and forth with various questions.

4. Consider putting more budget in place for the right team members to deal with enquiries rather than whoever is on shift at the time.

5. Set up your systems so all team members can see and hold availability if the right person isn’t around. It means someone is at least committed and less likely to go elsewhere, even if you need to confirm menus or other details.

6. Install interactive voice response on your telephone system so your customers can be directed to the right person straight away.

7. Aligned to the last point, consider an automated reservation call system with your reservation provider so customers can always make their booking, even if no-one is available.

8. Be clear on any answer messages that a customer can book online or via email. If you are a small business you should also make it clear what the best times are to speak to someone.

9. For bigger businesses consider employing a revenue or reservation manager dedicated to overseeing this function. Have them shuffle bookings to maximise capacity, proactively reach out to existing bookings to tweak times to maximise table turns, and provide more foresight to future business flows.

10. Analyse the idea of setting up central reservations and have a dedicated team that can concentrate on this function, giving customers an amazing experience of your brand before their visit. A good starting place is having an overflow system set up for one person in central support or consider external providers.

Be sure to make sure you don’t risk doing all the hard graft and missing out on much-needed business by not answering the phone or replying to emails quickly enough!
James Hacon is managing director of Think Hospitality, which advises multi-site brands on growth, brand and development strategy, as well as investing in early-stage concepts with a bright future

Retail-style agreements by Ann Elliott

Some time ago we conducted a major piece of research with “self-employed” licensees at one of the larger UK pub companies to gain feedback on their pub partner/retail agreement. It was probably the most positive research project we have conducted in terms of outcomes and the results were published in the company’s mid-year report because they were that good.

Since then, I have been a fan of retail-style agreements because they allow licensees who have the enthusiasm and passion but not necessarily lots of experience or money to have a go at successfully running a pub.

Ei Group has such an agreement in the form of Craft Union. It states: “At the Craft Union Pub Company our philosophy is about putting brilliant pubs back at the heart of local communities. We believe pubs play a vital role in the lives of their customers and we are committed to nurturing this.”

Punch has a retail contract. It states: “The retail contract is a fantastic three-year agreement and the ideal way to run a pub on a self-employed basis. You’ll have peace of mind knowing most of the day-to-day bills associated with running a small business are not yours. This leaves you free to focus entirely on delivering a great retail offer while driving sales and profit.”

Marston’s also has what it calls a true retail agreement. It states: “Our retail opportunities represent true partnership agreements, offering shared responsibility packages for enthusiastic retailers with the added benefit of being rent free! Our retail opportunities are the ideal way to run your own pub business on a self-employed basis but with the comfort of knowing you have a managed house support structure behind you.”

The essence of these agreements is that the licensees are all self-employed, often having to set up their own limited companies before they move into the pub and charging the pub owner a percentage of turnover for their services. The pub owner, in turn, takes care of everything else – the building, fixtures and fittings, utilities, marketing, stock and sometimes security on the front door. It often also determines the beer-stocking policy, pricing and margins as well as menus, food pricing and food margins. The pub company provides the environment and the licensee builds the business they want and the life they want to lead.

Of course it could be argued tenants and lessees are also self-employed – it’s their own business after all. They pay rent and take on different levels of liability in terms of repairs. The difference between a typical tenancy agreement and a retail agreement is not the self-employed piece, it’s the level of support and infrastructure provided by the pub company and the lack of finance needed by the licensee. This makes it a whole different (and maybe better) ball game to running a leased pub or tenancy.

These agreements support (and sometimes reward) the licensee in achieving sales targets. The ratios of business development managers to pubs are traditionally lower than in a tenanted environment. I used to look after 64 pubs when I was pub partnership business development manager, which was virtually impossible if you had to provide any sort of business-building advice to those who wanted it. Now business development managers might have fewer than 20 pubs, meaning they can give every venue the support it needs to provide great customer service, market the pub and drive sales.

I like the idea of a licensee having to focus on little more than service, sales and profit. Not having to worry about the price of beer, the quarterly rent bill, equipment breaking down or shabby accommodation must be immensely liberating. I wonder if this is one of the reasons for the positive performance of the pub sector (relative to casual dining) at the moment. This is a sustainable model for the sector and worth exploring and expanding further by more businesses in the future.
Ann Elliott is chief executive of Elliotts, the leading integrated marketing agency in the hospitality and leisure sector –

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