An Inhospitable Landscape
We recently hosted a webinar with NCR, a global leader in banking and commerce solutions, that focused on creating Human Centered Experiences in restaurants and hospitality.
A relevant topic in any market, the past year has introduced new challenges for industries that rely on in-person connections. The struggle to control what has become a fragmented customer experience has left many brands ill at ease. For restaurants, reliance on 3rd party ordering and delivery platforms may have helped them stay afloat in 2020, but the price of doing business has cost them their most valuable asset: access to their own customers.
Human Centered Experiences
Backing up a step, let’s take a look at the idea of Human Centered Experiences. A warm greeting, the hum of conversation, enticing smells from the kitchen, and someone to take your coat are all elements that forge a memorable connection with a physical place.
But today, over half of our experience with brands takes place online, and in the past year, even more so as we’ve been confined to the home.
The inability to control that in-person, sensory experience mandates the use of customer data to impart some sense of knowing what is relevant to each individual. Personalizing the digital experience can be powerful when done correctly, but requires comprehensive access to the customer throughout their journey.
How did someone find your establishment? What caught their attention? How many people are in their home? Do they have a food allergy? Did they redeem some kind of offer? Where did they find it? Are there common days or times that they order? Was there an issue with the order? Did they leave a review?
Even if we could learn the answers to these questions by simply asking during a visit, recording, organizing and using the information in marketing requires investment in technology. For the most human-centric of industries – namely hospitality – the great irony is that good food and ambiance are not enough to give customers a great experience each time they interact – they also need help from machines.
A Double-Edged Sword
Commissions of up to 30% charged by the big delivery apps seem like the biggest injustice to restaurants, who typically operate on just 3-5% margins. But backed into a corner, most accepted agreements in spite of these fees in an attempt to drive sales during (and before) covid.
But when the pandemic ends, and restaurants can get back to doing what they do best – feeding people and hosting them on site – they won’t have any way to identify, understand or market to the vast majority of their customers. The delivery apps will have this information, and they aren’t interested in sharing it.
But the good news is that without ditching delivery apps, restaurants can reclaim control of their customers. With a strategy in place, they can create human centered experiences that will drive true brand loyalty and the financial gains that follow. Loyalty programs have always provided a platform for brands to communicate with customers, but they can also motivate customers to directly connect with brands instead of via 3rd party apps.
Reclaim Your Customers
Your customers want you to stay open. They want to know the dollars they spend with you are going to be reinvested in your business. And if they are being asked to go the extra mile, which these days could be a request to sign up for your loyalty program and to order directly from you, they want to be recognized and rewarded for their effort.
By providing a bridge between you and your customers, a simple loyalty program gives you control over the customer experience and helps you to improve it over time. Beyond identification, you are able to learn their behaviors and preferences to inform individualized experiences through more relevant marketing, positively impacting revenue and reducing costs.
In fact, personalized marketing has been shown to reduce acquisition costs by as much as 50%, lift revenues by 5–15% and increase marketing spend efficiency by 10–30%.
As the hospitality industry begins to return to pre-covid practices, everyone will be working to provide the great experiences missed by customers. But it would be short-sighted to assume that many of the changes to customer behaviors will simply go back to the way they were before. Customers will continue to engage online and via 3rd party apps, underscoring the importance of establishing and owning direct relationships today.