One of the biggest transformations the hospitality industry has undergone in the past 30 years is the application of technology. Not only has digital technology made running and dining at a restaurant easier, but it’s fundamentally changed the way we run establishments as restaurateurs, and changed the way we eat at them.
This edition of Weekly Bites covers some of the latest ways that technology is shaping the hospitality industry — for better, or for worse.
Read on to learn about how technology is helping restaurants save money, why choosing the right reservation platform is critical, and how NFTs are changing how we score the hottest table in the city.
Most restaurants today use at least one kind of digital platform to make things run smoother. Back of House, a marketing and technology consultancy for restaurants, released an article about 5 ways that technology can save restaurants money. Here, we’re summarizing some of the key points.
Beyond customer-facing tech like reservations systems and QR code menus, technology can help drive efficiencies in both the back of the house and front of the house, saving restaurants money and making them more resilient. Point of Sale and Kitchen Display Systems help the back of the house manage orders and reduce human errors.
With such tight margins, food waste is a huge potential money waster. Tech solutions like inventory trackers, recipe developers, and food waste management solutions help to minimize the waste your restaurant produces. Some food waste is inevitable, but there are even some technology platforms that help you profit off of your wasted food or turn it into tax-deductible donations.
One of the hardest parts of recipe development for chefs is calculating whether a menu item will be profitable, given the cost of ingredients. The good news is that there are tech solutions for analyzing food cost against sales data to help you make the right decision.
Using technology to track sales and expenses is useful to keep the books in order. Beyond that, however, these tools generate data that you can use to forecast how the restaurant will do in the future, helping you make critical decisions that save you money.
Do you ever take those Buzzfeed quizzes that claim to tell you when you’re getting married based on the house that you build? Well, it turns out that what reservation platform you use says a lot about your restaurants.
Christina Woog, a marketer from LA, sums it up: “OpenTable is economy. Resy is premium economy. Tock is business class.”
Reservation platforms used to be a means to an end — a sometimes clunky interface on your website that made it easier for guests to make reservations without having to pick up the phone. Now, we’re seeing that reservation platforms have developed their own distinct brand, which means that when you choose a particular platform, you’re also saying something about your restaurant’s brand.
Reservation platforms are becoming similar to dating apps — they all have the same basic functionality, but the one you choose says a lot about your intentions. Using Tinder, for example, tends to carry the meaning of a casual fun time, while using Hinge indicates you’re looking for something serious. In the same way, using OpenTable means you’re making a reservation for convenience, while making a reservation on Tock means you just scored a seat at an expensive and exclusive dining spot.
As a result of the pandemic, more restaurants than ever are accepting reservations, and in more limited hours than before. Gone are the days where people go to your restaurant’s website and use whatever reservation app is on there. Now, people are browsing the reservations apps themselves to look for the “hottest” new restaurants to score a table at.
That means that it’s important to consider who your “cohort” of other restaurants on the app are. You want to choose the app that aligns with your restaurant’s brand, in order to reach your target audience. OpenTable is considered the great equalizer, and handles mostly budget restaurants. Resy is great for prix-fixe menus that are still reasonably priced — somewhere in the $150-300 range. Tock is for the hard-to-get, exclusive, and expensive reservations. The kind of place where you get a huge hit of adrenaline once you’ve managed to snag a reservation for next month.
What reservation platform do you use?
In the fine dining world, exclusivity is not new. There have always been celebrity restaurants, with celebrity chefs and celebrity patrons. Scoring a reservation at these high-end establishments would usually be near-impossible for the average person. For those that have money and status, however, all it would take is a quid pro quo and a folded $100 to the host or hostess.
Now, in big cities like New York, it feels like the exclusive few are becoming the exclusive many, and many establishments are closing their doors to more and more people.
A possible explanation for this is that many restaurants have cut back hours after the pandemic, making reservations harder to score for the average person. According to The New York Times, however, that’s only part of the story.
While reservation platforms are for the masses, the elite few are using concierge services, investing in reservation-granting NFTs, and becoming members at “clubstaurants.”
Concierge services exchange time for money. Want to snag a table? You can pay these services a minimum of $50 per reservation and skip the whole waiting in line (or refreshing Tock until the new batch of reservations come online). The people who run these services have taken the time to develop relationships with restaurants around the city.
Clubstaurants are also rising in popularity. These are members-only establishments where patrons pay an annual fee and commit to a certain number of reservations per year. Not on the member list? Not even the concierge services can score you a table.
Other restaurants are utilizing the blockchain to offer NFTs (non-fungible tokens) in exchange for access to reservations. These tokens are paid for by cryptocurrency (Etherium) and are valued on the blockchain. Each token is unique, acting almost as a badge of membership. In exchange for purchasing the NFT, the restaurant either provides a standing reservation or early access to book a table.
While these new technologies in reservations can be great revenue generators for restaurants, are they ultimately good for the hospitality industry? Is more exclusivity what we really need?