Aug. 20, 2012
By Noah Glass
In addition to his goal-scoring prowess and fancy stick-work, hockey legend Wayne Gretzky is famous for saying, "I skate to where the puck is going to be, not where it has been."
It's great advice for scoring goals – and for doing business. Gretzky was called "The Great One" for a reason; few of his rivals were able to follow his advice. As business people, we often find ourselves in the same position: Staring at the puck as it flies by, instead of having skated to where it will be.
Applying Gretzky's concept to our industry's efforts to engage with their customers, restaurant operators must start to skate in the direction of digital technology – and fast! Whether a brand's key customers are part of the 79 percent of the American population that regularly uses the Internet and mobile devices ("Active Digital Consumers") or the remaining 21 percent of the population that has yet to "go digital" ("Passive Digital Consumers"), every consumer is now a digital consumer.
Because of this, restaurant operators must reimagine and reinvent how they attract, engage, and analyze consumers. This process is much more informed than ever before, due to the mountains of valuable digital data that customers generate through digital technology. Called "metadata," it includes detailed behavioral information that has, until now, been difficult for restaurants to collect and utilize. Imagine knowing where a customer was before and after dining at your restaurant, what items the customer considered before settling on a final order, when and what that customer has ordered in the past, and how many friends and followers the customer may be able to refer to your restaurant. Metadata makes it all possible.
In the era of the digital consumer, the puck is moving fast, with new technologies being adapted as rapidly as they are hitting the shelves. As an example, Mary Meeker, in an Internet Trends presentation to the The Wall Street Journal's D: All Things Digital Conference earlier this year, noted that 29 percent of American adults now own a tablet or eReader vs. 2 percent less than three years ago.
Moreover, Nielsen reports that 40 percent of the U.S. population now owns a smartphone. And Meeker demonstrates that mobile user growth is now 31 percent year over year. The bottom line? The majority of consumers will be carrying around smart mobile devices in the very near future and many are already doing so today.
How are consumers using these devices? According to Google, 50 percent of American smartphone owners use their smartphones to search for restaurants. And Nielsen reports that nearly 50 percent of American smartphone owners used their phone to make a purchase in June 2012 alone. Clearly, Active Digital Consumers are seeking out ways to discover restaurants and transact from their mobile devices.
Encouragingly, restaurant operators identify mobile websites and mobile apps as the top two priorities for customer engagement technologies over the coming years, according to the recent Hospitality Technology 2012 First Annual Customer Engagement Technology Study, which my firm, OLO, co-sponsored. The study found that the number of restaurant brands with mobile websites is likely to double and the number of restaurant brands with mobile apps is likely to quadruple.
Mobile websites and mobile apps are truly the best ways to interact with Active Digital Consumers on their own turf: Connected, location-aware, and always-on mobile devices. Digital signage and tablets are also valuable, as customer engagement tools that bring the digital experience to Passive Digital Consumers, giving them a taste of the ways digital technology can enrich their dining experience and encouraging them to join the world of the Active Digital Consumers.
And yet, restaurant operators and their counterparts are still lagging behind the American consumer's drive to go digital. Comparing consumer media time vs. advertising spend by media channel (print, radio, TV, Internet, and mobile), Meeker demonstrates convincingly that there is still a massive gap in advertising spend in the online and mobile channels vs. the amount of time that consumers spend consuming media on the Internet and on their mobile phones. One would expect to see advertising spend skew in favor of these interactive digital channels, yet 77 percent of total advertising spend is still dedicated to non-interactive, traditional channels.
Now is the time for restaurant operators to take action and go digital to yield new and valuable insights and stay relevant to consumers. After all, Wayne Gretzky is also well known for another quote: "You miss 100% of the shots you don't take."
Noah Glass is the founder & CEO of mobile and online ordering provider OLO. Highlighting OLO's innovation, Glass has been featured on Good Morning America, The Wall Street Journal, ABC World News, and The Big Idea with Donny Deutsch.
Cover photo: merelymel