Blog

Big data: Can it help you build a better restaurant?

Big data can be a game-changer for restaurateurs, helping them understand the unseen drivers behind sales.

May 24, 2016

By Warner Siebert, Senior Vice President of Sales and Marketing at CAKE

The hospitality industry is on the cusp of a revolution. Every day, we see new and more advanced methods for collecting and interpreting customer data. The advent of "big data" — that massive amount of information businesses can now collect from customers — has changed the face of service. Restaurant owners who master the concept of big data have an edge over their competition.

Structured vs. unstructured data

Data falls into two categories: structured and unstructured. What follows is a brief description of the difference.

• Structured data is anything you might receive from a point-of-sale system. This includes lists of items sold on a given day, reservations from a particular night and comments or "likes" from social media. This category also includes raw data, such as guests' email addresses and phone numbers.

• Unstructured data comes from external sources. This includes information like traffic patterns, weather and even population density around different locations. For instance, while it may make sense to build a cafe near a commuter train, if the same cafe was in a cornfield, the business model would need to change. If structured information explains what was sold and when, then unstructured information explains why.

The magic happens when the structured and unstructured data are analyzed together. Data analysts sort through a vast array of information from these two categories and use it to help the organization serve guests better.

Get real results

Interpreting data is an art. There are countless ways to amass information about guests that can help predict their behavior.

For example, GPS tracking can help restaurants track delivery drivers' routes. If a customer orders pizza at least once a week, why not send them a text during their commute home? This way, just about the time the customer is starting to think about dinner, a savvy restaurateur can swoop in and offer a special deal. Analyzing changes in sales after a text promotion can offer invaluable insight into solutions for inventory management in the future.

Another example would be a cafe that experiences a steady increase in sales at lunchtime on the first of each month. With some focused research, the owner might discover that this is also the day when workers at a nearby factory are paid. Armed with this information, the cafe can offer specials that coincide with their clients' cash flow.

Up to this point, it’s been a common practice for businesses to delete most of their data due to the high cost of storage and lack of resources to use it. However, analytics are growing fast. Ten years ago, there were no tools powerful enough to sort through this information. Today, however, strong analytical engines are just a click away.

Better marketing opportunities

Data is only as useful as the return on investment that it provides. Restaurant owners are finding new and more efficient ways to increase revenue by the numbers. Items can be advertised in specific locations based on local preferences. Bars can offer popular drink specials on slow nights to increase business. Restaurants can also track the reactions of loyal fans on Facebook and respond to their needs quickly.

As restaurants implement these new marketing techniques, a point-of-sale system can be used to collect data that shows which strategies are the most effective and what results they return on the investment.  

Big data for small businesses

Restaurants of any size can get great use out of big data analytics. In fact, the tracking of data is simpler for smaller restaurants than for national chains with hundreds of locations. A small business can collect this data in mere minutes and continue to profit from it for months.

Final Thoughts

Seating management, reservation tracking and ordering can all be made far simpler using these new restaurant technologies. Dedicated point-of-sale systems collect and analyze all of the data restaurants process daily. As a result, these systems save time and money, while allowing restaurant operators to do the work that got them into the business in the first place.  

Mr. Siebert founded BuzzTable in 2011; the company was acquired by Sysco in 2013. Today the system is rebranded as Cake Guest Manager.