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Online ordering provides the holy grail of customer-level data

Even for brands in which digital ordering represents a small percentage, its search traffic and order traffic represents a meaningful sample size from which brands can glean valuable insights.

September 19, 2014 by Noah Glass — CEO, Olo

My high school chemistry class taught me the difference between a "by-product" and a "co-product." Both are secondary and derived alongside the main product, but the co-product has unique inherent value, whereas the by-product may not. Tech experts have added to my Chemistry 101 education, recognizing that co-products also can be sold or reused profitably.

Restaurant industry analysts have asked me to explain the recent surge in popularity of digital ordering among quick-service restaurant and casual dining restaurant operators alike. In doing so, I've thought a lot about the co-products of my own product, digital ordering for restaurants. It turns out the co-product of digital ordering is also restaurant operators’ holy grail: customer-level data. The primary product adds great value to a brand – customers receive orders faster and feel like VIPs when they skip the line, and automated order taking and tender allow for greater transaction capacity. But the digital ordering process also unlocks a deep understanding of brands’ best customers and unearths marketing insights that yield game-changing results. 

One such co-product is being able to visualize hungry customers' physical locations when they're thinking about your brand and your food. No, this doesn't require Minority Report-like "pre-cogs." These insights are derived from digital ordering searches. Ordering is compiled in the cloud, and our company creates a heatmap that shows where customers are when they initiate the digital search for a specific restaurant or food item. National restaurants can benefit from a city-by-city search, while local operators can get data down to the street level.

When compared against your current store locations, a geographic overlay of brand demand would give the development team incredible clues as to where to locate your next store, based on the key metric of digital demand. Now, what if you could layer in additional metrics, like which devices these would-be customers were using for their search and how usage compares to that of your loyal customers? For instance, you may realize that users of the latest Android device represent a meaningful audience profile for your brand. In that case, you might seek out digital order search hotspots that originate from the same kinds of devices.

Digital ordering represents a growing percentage of sales when an ordering platform is in place. Even for brands in which digital ordering represents a small percentage of total sales, digital ordering search traffic and order traffic represents a meaningful sample size from which brands can glean valuable insights about their best customers.

Digital ordering data is just one customer data stream in this growing field of big and little data. Companies like Beanstalk Data and Zipscene are changing the way organizations individualize data and communicate offers. Thanks to their work, the thick Sunday circular full of printed coupons may not be recognizable to coming generations. Customer profiles gleaned from a wide range of data are getting smarter. They provide insight into both on- and off-premise behaviors, including past orders, daypart habits, and guest survey responses. Nimble innovators like Food Genius are mining over 50 million menu items to help brands better define their item pricing strategy – and sharing some fun insights about how we eat, state by state, in the process.

Moreover, it’s not just the operator that benefits from insights into individual customer behavior. The customer gains the potential for new experiences and money-saving offers. Knowing that Mary only picks up lattes after 4 p.m. in the middle of the week, never orders from the breakfast menu, and has opted into text updates is a powerful insight – and could be a boon for Mary when she is offered a free coupon to try coffee cake with her latte every Wednesday in October.

By understanding more about who our customers are, where they are, which devices they use, and more, brands can better serve these customers and find more potential customers who share the same characteristics. That's the holy grail for success in a food service landscape that is increasingly competitive.

^{Photo provided by EmpireOnline.}

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