Speaker 1: Welcome to Chopping It Up. I'm your host, Michael Halen,
Speaker 1: a senior restaurant and food service analyst at Bloomberg Intelligence.
Speaker 1: Today we're joined by Carl Orsbourne. He's the co author
Speaker 1: of the Delivering the Digital Restaurant books and COO of Juicer.
Speaker 1: Thanks for doing this, Carl.
Speaker 2: It's a privilege to be here. Mico. Thank you for
Speaker 2: your time. Looking forward to our conversation.
Speaker 1: Same man. So you know, let's start with a little
Speaker 1: background on your career path for the listeners that aren't
Speaker 1: familiar with your work.
Speaker 2: Yeah, it's been an interesting journey in anyways. I spent
Speaker 2: eighteen years at BP, the big oil and gas company,
Speaker 2: fifteen years of which were in the convenience store environment.
Speaker 2: That culminated in me running a thousand unit chain over
Speaker 2: here on the West Coast and based in California for
Speaker 2: a number of years. And I got to a point
Speaker 2: in my career I think I turned forty, and I said,
Speaker 2: you know what, there's a small company out there called
Speaker 2: Amazon doing convenience retail. Pretty well. I'm driving a Tesla
Speaker 2: and the world of gasoline might be a little different.
Speaker 2: And I was thinking, what's the next chapter going to look? Like,
Speaker 2: so I thought, maybe it's time to get into something
Speaker 2: a little bit more entrepreneurial, bit more innovative. And it
Speaker 2: led me to a conversation with actually my co author,
Speaker 2: who had left Young Brands and went to Kitchen United,
Speaker 2: you know, one of the foremost ghost kitchen companies out there.
Speaker 2: And I was speaking to her initially with the intent
Speaker 2: of trying to understand, you know, what's it like leaving
Speaker 2: a company of that size and going into a startup environment,
Speaker 2: and really we hit it off really well, and she
Speaker 2: then said, well, why don't you come and run operations
Speaker 2: for us at Kitchen United. And so that's really what
Speaker 2: my journey into the restaurant restaurant technology started back in
Speaker 2: twenty eighteen. And it was really there where I just
Speaker 2: met so many different folks in the industry, the independence
Speaker 2: through to the big chains, and saw the challenge of digitization,
Speaker 2: saw the challenge of off premise. Of course, all of
Speaker 2: this was pre pandemic, of course, where a lot of
Speaker 2: restaurants were trying to say, is this a flash in
Speaker 2: the pan, is this something we should take seriously, or
Speaker 2: is it something that perhaps will be gone in a
Speaker 2: few years. And I said to Meredith one day, driving
Speaker 2: back from Pasadena, I said, it would be great if
Speaker 2: we could get each of our clients, our prospects, a book,
Speaker 2: a book that can tell them why this is happening,
Speaker 2: why it's not the evil vcs, why it's not the
Speaker 2: evil technology companies, but actually why it's the consumer that
Speaker 2: is driving a lot of the energy in this direction.
Speaker 2: And she said, great, and go on Amazon and see
Speaker 2: what you can find. We'll do that, and I think
Speaker 2: that's where Meredith's expectation of our book Journey with end
Speaker 2: quite honestly, Mike, but it didn't right because obviously I
Speaker 2: didn't find anything on Amazon. When we left Kitchen United
Speaker 2: we went about writing the book, we were just in
Speaker 2: the early throes of the pandemic. Every restaurant very quickly
Speaker 2: became a ghost kitchen. Every restaurant had to embrace off premise,
Speaker 2: and our book came out right in the middle of it,
Speaker 2: so it could have been better timed. And in that sense,
Speaker 2: the first book, delivering the Digital Restaurant, Your Roadmap to
Speaker 2: the Future of Food, was all about the why. We
Speaker 2: interviewed one hundred or so executives about what's going on
Speaker 2: in the worlds of off premise and technology, Why to
Speaker 2: be excited about it? Why not to be concerned? And
Speaker 2: it became an international but seller, won a few awards,
Speaker 2: and it really helped me, from a career standpoint, position
Speaker 2: myself as a thought leader in this space. And that
Speaker 2: really led to me being involved in a number of
Speaker 2: advisory roles for food technology restaurant technology companies across the ecosystem.
Speaker 2: I said, on the board of a restaurant group in
Speaker 2: the Middle East, and it's also where my co founders
Speaker 2: are of Juicer found me because they were coming in
Speaker 2: from the travel and hospitality sector and came across the
Speaker 2: book and they told me about what they were doing
Speaker 2: in building a company to help restaurants price more effectively,
Speaker 2: and for me, it just seemed like the next area
Speaker 2: of innovation for the industry, and so about eighteen months
Speaker 2: or so ago joined up with them and that's what
Speaker 2: I've been doing ever since, alongside the new book which
Speaker 2: has just come out, which is under the same name,
Speaker 2: Delivering the Digital Restaurant but the Path the Digital Maturity,
Speaker 2: and this one is almost an accompaniment to the first,
Speaker 2: where it's more of a how to. The first books
Speaker 2: why trying to help restaurants figure out how to you know,
Speaker 2: work through the treacle of figuring out technology in our
Speaker 2: industry and hopefully help them focus where the focus is needed.
Speaker 1: Yeah, it's great. Both books are phenomenal. I can't recommend
Speaker 1: them enough. And I love that you worked as a
Speaker 1: driver for door Dash as part of your research for
Speaker 1: the book, so I got to know, did you ever
Speaker 1: try to sneak a French fry? Where you ever tempted
Speaker 1: to sneak a French fry out of one of those
Speaker 1: bags as a DoorDash?
Speaker 2: No? No, but it was very much a front and
Speaker 2: center area of concern at that time. A lot of
Speaker 2: media was referencing it. But you know, the thing I
Speaker 2: did would say is that I wasn't treated very nicely.
Speaker 2: I really felt the pain that a lot of drivers
Speaker 2: actually get. And you know, whether it be the staff
Speaker 2: at the restaurant looking at the drivers as where you're
Speaker 2: taking my tips away from me, or just the general
Speaker 2: inconvenience that drivers were bringing into the overall mix of
Speaker 2: the operating environment of a restaurant. And I think that's
Speaker 2: really where we try to focus on the first book,
Speaker 2: where we dedicated a whole chapter to drivers to say, look,
Speaker 2: if you think about the driver as a team member,
Speaker 2: as someone that is an extension of your brand, because
Speaker 2: they are fall intents and purposes, the face of your
Speaker 2: brand at the doorsteps of your customers, you know, three
Speaker 2: miles away from your restaurant. If you treat them right,
Speaker 2: then they're going to treat your brand right. And the
Speaker 2: best examples out there are those that you know will
Speaker 2: invite the drivers in to use the restroom, to give
Speaker 2: them a free cup of coffee, to let them try
Speaker 2: out their latest lco So that way, when they are
Speaker 2: in front of the customer, they can say, well, enjoy
Speaker 2: your chicken corma tonight. By the way, they've just done
Speaker 2: the teaka masala differently. You know, you should check it
Speaker 2: out next time. That type of extension of service is
Speaker 2: what're we kind of have come to expect from the
Speaker 2: servers at our tables, So why shouldn't we expect that
Speaker 2: from the drivers at our doors as well.
Speaker 1: Yeah, I think that was a great take away from
Speaker 1: that first book. So I'm hearing a little bit of
Speaker 1: concern about deliveries slowing down with consumer spending. Can you
Speaker 1: give us a little color about what's going on out there?
Speaker 2: Yeah, Well, look, I think it's natural to see some
Speaker 2: pullback from where we've been in the last few years
Speaker 2: through the pandemic. I think given the inflationory environment, the
Speaker 2: resilience of the delivery channel is actually holding up pretty well.
Speaker 2: I was listening to some Medalia research shared at Food
Speaker 2: on Demand that forty one percent of customers say that
Speaker 2: in spite of the inflationary pressures, they're still ordering as
Speaker 2: frequently as they were before. And you know, you need
Speaker 2: to look at the latest results from DoorDash right. Only
Speaker 2: last month, DoorDash raised its profit forecast after beating their
Speaker 2: quarterly revenue expectations, and they've been saying they've seen increased
Speaker 2: orders on food, groceries and convenience products despite the high inflation.
Speaker 2: And I think there's an important area there to focus
Speaker 2: on because they weren't necessarily saying it was just on food, right,
Speaker 2: So their investment in all these other verticals I think
Speaker 2: is starting to play out as well. Similarly, you know,
Speaker 2: their orders are up in that course, so I think
Speaker 2: twenty seven percent. So yeah, I think there is some
Speaker 2: commentary out there. Clearly it's not necessarily at the heights
Speaker 2: of what we were seeing during the pandemic. You know,
Speaker 2: On the flip side of all that, I think we're
Speaker 2: definitely seeing a retrenchment on ultra fast retail for film,
Speaker 2: and I think that is certainly dropping back. You know,
Speaker 2: how fast do you really need that shampoo or box
Speaker 2: of cereal? You know, I've read something recently about the
Speaker 2: app downloads food and drink delivery. App downloads globally have
Speaker 2: shrunk significantly in the last year. To give you some flavor,
Speaker 2: I've got some numbers here over here. Seven hundred and
Speaker 2: thirty seven million apps were downloaded in twenty nineteen, seven
Speaker 2: hundred and ninety seven in twenty twenty, eight hundred and
Speaker 2: seventy seven million in twenty twenty one, and then it
Speaker 2: shrank in twenty twenty two to seven hundred and seventeen million,
Speaker 2: so an eighteen percent drop, and interestingly, about forty four
Speaker 2: percent of those were in the Asia Pacific region. And
Speaker 2: from reading the first but you remember, we talked a
Speaker 2: lot about how the US in many ways is still
Speaker 2: behind a lot of other global entities out there, and
Speaker 2: I think, you know, when you see that, you can
Speaker 2: see there's still a lot of innovation happening, but an
Speaker 2: app download is i'd tell one off event so probably
Speaker 2: it's not something we should be too surprised to see.
Speaker 2: Last thing I'd say about your question is if you
Speaker 2: were to look at the specific channels of dash Pass
Speaker 2: subscriptions or Uber one or grub up plus with their
Speaker 2: Amazon Prime hook up, you know that these subscription orientated
Speaker 2: channels are doing incredibly well right now. So the aggregators
Speaker 2: are super super bullish on those, and I think it's
Speaker 2: making the third party the first party conversion agenda that
Speaker 2: much more difficult. But yeah, I'm still pretty confident. I
Speaker 2: think we're still going to be in a good place
Speaker 2: when it comes to delivery. But no huge surprise that
Speaker 2: given the inflation environment, we've seen a bit of a
Speaker 2: drop off.
Speaker 1: Okay, good stuff, And that leads me to a couple
Speaker 1: more questions that we have. Is DoorDash still the top
Speaker 1: US option for third party delivery? And if so, what
Speaker 1: are their big competitive advantages?
Speaker 2: Well, look, the bracton market share that they've been able
Speaker 2: to get is amazing. I think they're over or close
Speaker 2: to see sixty percent market share in the in the
Speaker 2: US right now. And again, I think that dash Pass
Speaker 2: subscription has been something particularly supportive of that. You know,
Speaker 2: they launched that in the summer of twenty eighteen, where
Speaker 2: Uber one only launched in I think it was the
Speaker 2: end of twenty twenty one. So they have approached market
Speaker 2: sharing a very diligent fashion. You know, they targeted restaurants
Speaker 2: that didn't have any delivery service. They really put a
Speaker 2: focus on empowering restaurants with great data and insights and
Speaker 2: trying to help them have the tools necessary to succeed.
Speaker 2: And then they focused on the urban areas with the
Speaker 2: you know, the larger households, the higher average order values.
Speaker 2: I think they try to be a restaurant first organization,
Speaker 2: and of course, unlike Uber which didn't necessarily start out
Speaker 2: with the eats products, they have got their heartened mind
Speaker 2: completely centered around the restaurant. You know, with all that said,
Speaker 2: there are creating a level of consternation out there right
Speaker 2: now with the price parity piece. Right so they're sending
Speaker 2: letters out to restaurants saying, if you don't price within
Speaker 2: a certain price range of your dining or your first
Speaker 2: party platforms, we're going to reduce your presence or rankings
Speaker 2: on the marketplaces themselves, which has got so many restaurants
Speaker 2: concerned and nervous about well, what does this mean, you know,
Speaker 2: even some of the biggest chains out there now. I
Speaker 2: think there's a couple of ways of looking at that.
Speaker 2: There's one, which is you could argue that given the
Speaker 2: inflation environments, you can understand Doordash's position because perhaps they're
Speaker 2: starting to see that impact. But similarly, I think restaurants
Speaker 2: are realizing how the importance of having a first party
Speaker 2: platform because if they have, if they have something that
Speaker 2: can compete, if they can give their customers some value
Speaker 2: which is at a cheaper price and perhaps as good
Speaker 2: a experience, then why wouldn't they want to encourage their
Speaker 2: customers in that direction, not just because of the better margins,
Speaker 2: but also because of the data that they're going to
Speaker 2: be able to get access to.
Speaker 1: Yeah, for the national change that we cover, this has
Speaker 1: been a key point of emphasis for them for a
Speaker 1: couple of years now. So how effective have chains been
Speaker 1: converting customers from third party to the first party in
Speaker 1: the last year or so and is that impacting third
Speaker 1: party delivery growth?
Speaker 2: Well? I think it depends on the chain. Of course.
Speaker 2: You know, there's certainly success stories when you look at
Speaker 2: Chick fil A, Chipotle, Carva. I guess having a chain
Speaker 2: beginning with CEA helps in that regard. But the way
Speaker 2: I'd look at it is is think about the experience
Speaker 2: that those chains are getting through their apps and their
Speaker 2: first party they're typically offering loyalty, they're typically offering payment,
Speaker 2: and they're typically offering an app that services an omni
Speaker 2: channel guest, which means it's not just an app for
Speaker 2: the delivery occasion, and that means you can use the app,
Speaker 2: you're encouraged to use the app for every time you
Speaker 2: engage with the restaurant. That is so critical. It's a
Speaker 2: trifecta that I think is really really important. And you know,
Speaker 2: when you look at Chick fil A and Chipotle's numbers,
Speaker 2: certainly against the research that I've seen, they're getting something
Speaker 2: like thirty to forty percent of their customers coming through
Speaker 2: that first party channel. Now that said, they're still having
Speaker 2: thirty percent or so, you know, going through a third party.
Speaker 2: And so with that in mind, that tells you that
Speaker 2: there's always going to be a third party customer, a
Speaker 2: customer that has the past subscription that wants to be
Speaker 2: able to utilize that particular medium. But even with Chick
Speaker 2: Filan Chipotle, going back to what we were just talking
Speaker 2: about with price premiums. You know, their price premiums are
Speaker 2: as high as thirty percent in some instances, and so
Speaker 2: they're saying to the guests, well, look, if you're willing
Speaker 2: to pay for that door Dash or Uber Eats experience,
Speaker 2: go right ahead. You're going to pay twenty five thirty
Speaker 2: percent more. But if you come to us, we're going
Speaker 2: to give you rewards. We're going to give you a seamless,
Speaker 2: frictionless interface, and we're going to make sure you can
Speaker 2: pay as simply as possible. You know, in the book,
Speaker 2: I have this reference to count the clicks, and what
Speaker 2: I encourage any restaurant listening to the podcast to do
Speaker 2: is to count the amount of steps it takes for
Speaker 2: your restaurant as a registered customer for them to go
Speaker 2: through a door dash and to order the main idem
Speaker 2: on your menu, and then count the same amount of
Speaker 2: steps it takes on your first party interface, because every
Speaker 2: incremental step, every incremental click, is a reason why they
Speaker 2: sho might as well stay on the third party interface.
Speaker 2: And I think we put a lot of time thinking
Speaker 2: about how do we tell customers about the first party
Speaker 2: you know, is it a bag insert, is it the packaging.
Speaker 2: But actually a lot of times it's all about the
Speaker 2: user centered systems, design of the actual app, of the
Speaker 2: actual interface itself. And if you can get that right,
Speaker 2: then actually you're removing the friction and you're creating the convenience.
Speaker 2: And of course whider customers order delivery because of the convenience,
Speaker 2: so you've got to have that front and center.
Speaker 1: Yeah, and we saw that with Dominoes kind of being
Speaker 1: ahead of the ahead of the game a little bit
Speaker 1: with their tweet to order and zero click ordering systems
Speaker 1: and things of that nature. Our third party delivery rate's
Speaker 1: still in that fifteen to thirty percent range for orders
Speaker 1: placed on the marketplace.
Speaker 2: Yes, they are obviously scale matters. You can get certainly
Speaker 2: some good rates out there. Exclusivity matters, so if you're
Speaker 2: only going to be on one particular marketplace, then that
Speaker 2: can lead to better rates. And I would always encourage
Speaker 2: restaurants to really think about which apps are most prevalent
Speaker 2: in their area. Even with door dash having sixty percent,
Speaker 2: you know, there are certain parts of the states where
Speaker 2: they don't have as many DoorDash drivers, they don't have
Speaker 2: as much presence on the market for the customers using
Speaker 2: those apps. And you know that's true in places like
Speaker 2: New York, for example, where DoorDash users might not be
Speaker 2: as prevalent as you might see elsewhere. Similarly, in LA
Speaker 2: close to where I am, the Postbates customer still is very,
Speaker 2: very prevalent, and so it's interesting how that has played out.
Speaker 2: But what's happened recently in the last year or two
Speaker 2: is that they started to introduce different tiers. In fact,
Speaker 2: page seven of the part of the Digital Maturity touches
Speaker 2: on these different tiers, and it's trying to empower the
Speaker 2: restaurant with I guess a choice as to be able
Speaker 2: to say, well, depending on which level of tier you
Speaker 2: want to pay, you can get access to different services.
Speaker 2: So you have to be on a different tier, for example,
Speaker 2: to be able to have access to those dash past customers.
Speaker 2: You have to be on a certain tier to be
Speaker 2: able to have a wider delivery radius. Right, So there
Speaker 2: are things which I think they're trying to do to
Speaker 2: empower the restaurants to be able to have that choice.
Speaker 2: But look, you know, we've gone from a world where
Speaker 2: this was a small yellow pages of restaurants and now
Speaker 2: it's huge, right, We're talking about a huge level of
Speaker 2: choice that restaurants have to compete against. And it's super
Speaker 2: super important to be above the fold when customers are choosing,
Speaker 2: because there's only a certain amount of searches that they're
Speaker 2: going to go through before making a choice as to
Speaker 2: where they want to eat because they're hungry, right, They're
Speaker 2: not going to spend all night trying to find the
Speaker 2: perfect restaurant.
Speaker 1: Yeah, that's a great point. And to that point, you know,
Speaker 1: being above the fold and making sure that you know
Speaker 1: customers see you when they open the app. What's the
Speaker 1: right amount of marketing spend on those third party delivery
Speaker 1: platforms for a restaurant?
Speaker 2: You know, what's the right frequency is probably the right question, right,
Speaker 2: And the answer to that is always on. The algorithms
Speaker 2: will absolutely penalize you if you ever stop your marketing.
Speaker 2: So I've heard many restaurants say to me, look, even
Speaker 2: if I'm putting ten dollars on, it's better for me
Speaker 2: to keep the ten dollars on than to shut it
Speaker 2: off entirely. You know, and much like a brick and
Speaker 2: mortar restaurant launch, you will want to use the launch
Speaker 2: period benefits well. So if you're about to launch a
Speaker 2: new concept, or even a new unit in a new location.
Speaker 2: It's important for you to have a high level of
Speaker 2: spend in those first thirty to sixty days, much like
Speaker 2: you would with your grand openings and everything else that
Speaker 2: you'd do for a physical launch. In terms of the
Speaker 2: marketing spend on a platform, i'd also answer that in
Speaker 2: a slightly different way to one, in the sense that
Speaker 2: you should be looking for a ten x ro ass right,
Speaker 2: so you want to be making sure that you're you're
Speaker 2: getting at least that kind of level of return. I've
Speaker 2: seen some advocate and in terms of percentage of sales
Speaker 2: of five to eight percent of your sales to go
Speaker 2: towards marketing. Andre Vena of doghouse is suggested ten per
Speaker 2: sent to me in the past, and I think the
Speaker 2: point is you need to have a view, you need
Speaker 2: to measure it, and if it's successful, you need to
Speaker 2: do more of it, and if it isn't, you need
Speaker 2: to do less. And the whole idea of recognizing that
Speaker 2: the restaurant industry now is fast becoming an e commerce
Speaker 2: industry will help you condition your mind in the right
Speaker 2: way to be able to explore this. Because the restaurant
Speaker 2: marketing the cmos of restaurants and their makeup today is
Speaker 2: so so different to what they were ten years ago.
Speaker 2: And so this idea of ab testing, for example, which
Speaker 2: is a you know common practice in e commerce world
Speaker 2: is test different things until you see and improve and measure,
Speaker 2: you know, sit until you see the outcomes that get
Speaker 2: you to something that you're excited about. Because marketplace marketing
Speaker 2: is performance marketing. You know, you're not trying to tell
Speaker 2: your brand story and build awareness here. It's about really
Speaker 2: those metrics. And the other thing I'd mentioned here is
Speaker 2: it's important to look at consistency. If you're a chain,
Speaker 2: you'll be amazed at how many of your locations have
Speaker 2: the wrong hours listed, or they have inconsistent hero photos listed,
Speaker 2: or even no photos against certain items, or maybe they're
Speaker 2: not even listed because they've been they turned themselves off
Speaker 2: last night and they haven't switched themselves back on. There's
Speaker 2: a huge amount that can be done to just to
Speaker 2: optimize your footprint, regardless of the marketing spend that follows,
Speaker 2: and I'd highly encourage restaurants to focus on that first,
Speaker 2: even before getting into the marketing space.
Speaker 1: That's great, and you know, speaking to being always on,
Speaker 1: I think that.
Speaker 2: You know.
Speaker 1: What I learned from your book is that that also
Speaker 1: was important when it comes to just being available on
Speaker 1: the marketplaces, right, there's penalties for thrattling. Correct.
Speaker 2: Yeah, I think I haven't had this ever confirmed by
Speaker 2: the marketplaces, but I think it's an increasing concern for them.
Speaker 2: I mean, th had. We wrote an article for Nations
Speaker 2: Restaurant News in last summer and it was called why
Speaker 2: you Must Keep your Digital Doors Open. And the way
Speaker 2: I would put it is, imagine, Mike, you and I
Speaker 2: were to go out for lunch right now, and the
Speaker 2: owners of the restaurant shut the door in our face,
Speaker 2: and I didn't want to talk to us, and so
Speaker 2: therefore we weren't even able to come in, even if
Speaker 2: the restaurant was busy. I mean, that would be an
Speaker 2: awful hospitality experience for us. But what typically happens is
Speaker 2: that you and I would be invited to maybe sit
Speaker 2: at the bar. They'd hand us a menu that'd give
Speaker 2: us an indication as to how long we'd have to
Speaker 2: wait for, and then empowers with the choice as to
Speaker 2: whether we'd want to do that or not. Right when
Speaker 2: you throttle, you're basically closing your digital doors you're basically
Speaker 2: saying to the customer, we're not even open for your business.
Speaker 2: We don't even care about you. We don't necessarily are
Speaker 2: going to tell you when we're going to be back
Speaker 2: open again. You're not empowering the guests at all. And
Speaker 2: as you recall from the first book, we think third
Speaker 2: party marketplace customers in the large part are opportunities for
Speaker 2: you to gain new customers and to create that first impression.
Speaker 2: So by actually throttling, you're losing the opportunity to give
Speaker 2: that impression, to get that first time customer in the door,
Speaker 2: to give yourself the opportunity to convert them to your
Speaker 2: first party platform eventually as well. And so regardless of
Speaker 2: whether you're being penalized on the marketplaces or not, I
Speaker 2: think it's an awful customer experience. Uh. The flip side
Speaker 2: of all this is that you are constrained in a restaurant.
Speaker 2: You have a certain amount of capacity through pert and
Speaker 2: I think there's an increasing amount of focus now being placed,
Speaker 2: certainly through my friends over at Service Physics, trying to
Speaker 2: help restaurants figure out what is the capacity through but
Speaker 2: what is the total amount of orders that we can
Speaker 2: truly channel through this kitchen, and you know you're seeing, therefore,
Speaker 2: a change in the way in which the back of
Speaker 2: house is being designed. You look to the way in
Speaker 2: which Chipotle now have you know, two makelines, one for
Speaker 2: the front of house, one for the off premise channels.
Speaker 2: You look at the way in which this happened in
Speaker 2: drive through back in the sixties and seventies, and how
Speaker 2: they recognize, Look, if we're going to really make this work,
Speaker 2: we're going to have to design a back of house
Speaker 2: that helps us be able to get someone to drive
Speaker 2: through and collect their order in a matter of minutes.
Speaker 2: And now I think we're past the pandemic restaurants sort
Speaker 2: of realizing this delivery thing is here to stay. This
Speaker 2: is likely to be something like twenty thirty forty percent
Speaker 2: of our business, and so if we don't adapt our
Speaker 2: back of house operations to accommodate for that, then are
Speaker 2: we truly maximizing the throughput capability of our restaurant to
Speaker 2: service orders in the way our customers want to be serviced.
Speaker 1: Yeah, it definitely seems to be here to stay. You know,
Speaker 1: the casual dining chains that we cover, they're all deliveries
Speaker 1: now starting to settle in at about double what it
Speaker 1: was pre pandemic, so I don't see customer demand going
Speaker 1: away anytime soon. The restaurant co op model was pretty
Speaker 1: interesting when I read your first book. Have more popped
Speaker 1: up since you since you wrote the first one, Not.
Speaker 2: To my knowledge, doesn't necessarily mean that they haven't. I
Speaker 2: think restaurants have their own communities. They're not always the
Speaker 2: best to share. But John Siel's local group, who's we
Speaker 2: focused on in the first book. I think it's fascinating
Speaker 2: because you know, when you can have a model that
Speaker 2: succeeds in areas where perhaps the big marketplaces have focused
Speaker 2: their drive deployment elsewhere, or perhaps struggle to find the
Speaker 2: necessary drivers. It definitely makes sense, and it's a way
Speaker 2: of being able to encourage restaurants to come to get other,
Speaker 2: utilize their polled resources, and support their local community. So
Speaker 2: i'd be I haven't heard of any I'd be surprised
Speaker 2: if it's the only one out there, but I think
Speaker 2: clearly it's a different type of business model.
Speaker 1: Yeah, are there any other unique business models that can
Speaker 1: present the challenge to door dash and uber eats in
Speaker 1: the United States?
Speaker 2: I don't know whether they can present a challenge to
Speaker 2: dowd Ash and uber is because I think it's about
Speaker 2: service in a different needs state, and doored ash and
Speaker 2: uber eyes have their role to play. But there are
Speaker 2: certainly other models that are emerging. We talk about the
Speaker 2: vertically integrated delivery kitchens in the second book, like cluster
Speaker 2: truck and UMI and go to kitchens, and they have
Speaker 2: a substantial economic advantage over the incremental model that we
Speaker 2: refer to in the first book. And so therefore you know,
Speaker 2: we described them in detail in a chapter of the
Speaker 2: second book which is called the digitally native restaurant. And
Speaker 2: that whole concept is about how you think about if
Speaker 2: you were to redo the entirety of the business model,
Speaker 2: if you're to start from a blank sheet of paper
Speaker 2: and think about what a customer values, then you'd say, well,
Speaker 2: does the customer really value the cost of labor in
Speaker 2: this experience? Do they really value the cost of real
Speaker 2: estate and the experience? Do they want better quality food?
Speaker 2: Do they want better prices? Do they want the delivery
Speaker 2: of this food to be better? And we can only
Speaker 2: look at the recent stata to say that the delivery
Speaker 2: experience is not good today. And I think the answer
Speaker 2: to those questions would lead you to say, well, if
Speaker 2: you're starting from a blank sheet of paper, then having
Speaker 2: a business model where the entire operating system is shaped
Speaker 2: in such a way that allows you to be able
Speaker 2: to certainly reduce the real estate footprints and the costs,
Speaker 2: certainly reduce the labor and reinvest that back into better
Speaker 2: quality food at a better price, and be able to
Speaker 2: do it at an experiity manner. And I think that's
Speaker 2: super enticing and super encouraging. Fact. In a recent article
Speaker 2: that we did, we actually wrote about the fact that
Speaker 2: we think the native restaurant could well be the fastest
Speaker 2: growing restaurant concept in the US that will follow after
Speaker 2: Fast Casual. It's obviously small right now that I don't
Speaker 2: know of any big chains that are doing anything like this,
Speaker 2: but there are certainly many players like Cluster Truck and
Speaker 2: UMI that are making some great progress out there. And
Speaker 2: you know, Cluster Truck is one location in Indianapolis that's
Speaker 2: doing over eight million AUV through this type of model.
Speaker 1: Wow, impressive. Why are we seeing so many loyalty program
Speaker 1: upgrades right now?
Speaker 2: Yeah, Well, let me see, I have the way I've
Speaker 2: had to answer that. Look, I think we didn't have
Speaker 2: a chapter on loyalty in the second book. It kind
Speaker 2: of proliferates all the way through in different ways because ultimately,
Speaker 2: the understanding of a customer is something that I think
Speaker 2: restaurants are starting to understand is super super important. The
Speaker 2: fact that you can get customer data in ways that
Speaker 2: you weren't really able to do before the world's of
Speaker 2: delivery were upon us is something that's in really powerful.
Speaker 2: So you think about the best restaurant experiences that we have, right,
Speaker 2: You think back to your favorite restaurant, Mike, and why
Speaker 2: that was a great experience. And I think to an
Speaker 2: Italian restaurant near me, and you know, the guy that
Speaker 2: always serves my wife and I. He remembers our names,
Speaker 2: he remembers that we liked this particular bottle of wine.
Speaker 2: He knows about my wife's dietary preferences, and therefore he
Speaker 2: recommends things on the menu as a result, or comes
Speaker 2: up with a bottle of wine that we usually like. Right,
Speaker 2: And what an experience when you feel like you're that VIP.
Speaker 2: So you can only get that on a handful of occasions.
Speaker 2: Not every restaurant waiter is always going to be treating
Speaker 2: you like that, But in a digital world, every customer
Speaker 2: where you have that customer data can be treated like that,
Speaker 2: and I think that's incredibly powerful. So what do I
Speaker 2: mean by that in answer to your question about loyalty
Speaker 2: program upgrades. Well, loyalty is far more than a punch program.
Speaker 2: It's far more than a discounting program. It's about giving
Speaker 2: your guests the type of experience that they want based
Speaker 2: on their buying behaviors and their profile. And so Zach
Speaker 2: Goldstein at Thanks, I love his line. He always says,
Speaker 2: what if you were to treat what the top one
Speaker 2: percent of McDonald's customers to be able to have access
Speaker 2: to the McRib year round? All about if you were
Speaker 2: to take the Taco Bell customers and say, for the
Speaker 2: top one percent, they're invited to come to the headquarters
Speaker 2: and provide feedback and develop the next lto that's a
Speaker 2: way to treat loyalty in a way that would only
Speaker 2: represent and resonate with the top one percent. Of course,
Speaker 2: there are going to be those that are more value orientated,
Speaker 2: and there are going to be those that are more
Speaker 2: newness orientated that want to hear about the ltos. But
Speaker 2: all of these things are enabling restaurants to be able
Speaker 2: to say, if you understand your customer, if you're able
Speaker 2: to segment them appropriately, you can then give them the
Speaker 2: right mechanics they're going to drive them to increase their frequency,
Speaker 2: to increase their spend, and to recognize that because you
Speaker 2: know them, they want to know you, and they want
Speaker 2: to have an ongoing digital engagement.
Speaker 1: Yeah, very cool. I think that's a lot more powerful
Speaker 1: than just giving somebody their tenth burger free or their
Speaker 1: eleventh pizza free or something like that. Can you talk
Speaker 1: a little bit about, you know, the rapid tech adoption
Speaker 1: that we've seen over the last few years and how
Speaker 1: that's impacting independent restaurants.
Speaker 2: Yes, you know. The all it takes is standing in
Speaker 2: the middle of a conference exhibition hall and looking at
Speaker 2: a independent restaurant. So who perhaps has come to that
Speaker 2: this is there one a year that they go to
Speaker 2: and they look around and there's hundreds of vendors and
Speaker 2: they're going, where the heck do I start right there?
Speaker 2: It's this mire of confusion and complexity. There are lots
Speaker 2: of folks out there that's saying they have an only
Speaker 2: one solution. There are lots of folks out there that
Speaker 2: say they have a very specific solution, and as a
Speaker 2: result of that, as an independent, you're coming in and thinking, all, right, now,
Speaker 2: I recognize I need to treat delivery, right. I recognize
Speaker 2: I've got to invest in technology. And I think what's
Speaker 2: happened through the pandemic is a lot of restauranting. You know,
Speaker 2: chains and independent alike have done a bit of a
Speaker 2: spray and pray strategy of just deploying their resources into
Speaker 2: whatever technology was necessary to keep their doors open. And
Speaker 2: now they're looking at this and you know, a lot
Speaker 2: of the more established chains they're spending money maybe two
Speaker 2: to four percent of their sales on technology, fifteen to
Speaker 2: twenty different types of technology across their chain, and they're
Speaker 2: probably utilizing each one not thirty forty percent of its
Speaker 2: true capability, and they go, well, this doesn't make sense.
Speaker 2: And of course, in this cost environment right now, there's
Speaker 2: probably a lot of CFOs asking their CEOs to say, well,
Speaker 2: we need to tighten our belts a little bit here.
Speaker 2: And that's exactly the same for the independent as well.
Speaker 2: And so the independent not only lacks the resource to
Speaker 2: have that level of spend, but they also don't necessarily
Speaker 2: have the capability and capacity to spend in understanding what
Speaker 2: this technology can do and how to fully utilize it.
Speaker 2: And so the role I think here is for the
Speaker 2: technology companies to be better at being able to say
Speaker 2: who they service, what they offer, truly offer, how they
Speaker 2: differentiate from their competitors, and to be able to clearly
Speaker 2: articulate the way in which they support the restaurant be
Speaker 2: able to utilize their technology after the contract is signed.
Speaker 2: You know, the very basis of the Path to Digital
Speaker 2: Maturity book that we've written is to help the independent
Speaker 2: look at where they're at, to find where they are
Speaker 2: on this path to digital maturity and say, focus in
Speaker 2: on that space. First, deploy your resource, deploy whatever capacity
Speaker 2: you've got on getting good at that particular area. And
Speaker 2: then once you've got to that place, and there's a
Speaker 2: whole bunch of worksheets and tips within the book, once
Speaker 2: you've got to that place, then move on to the next.
Speaker 2: And at some point you might get to a point
Speaker 2: on this path to say, you know what, that's it
Speaker 2: for me. That's as far as I'm going to get.
Speaker 2: And that might mean that stunts your growth from that
Speaker 2: particular channel onwards, but at least you know that you've
Speaker 2: done as much as you can based on what you
Speaker 2: are able to do, and I think that's going to
Speaker 2: to get to a far more efficient use of an
Speaker 2: independent spend on technology. And it's also going to help
Speaker 2: them to recognize it's a marathon, not a sprint.
Speaker 1: No, I guess. Kind of focusing back out on the
Speaker 1: larger picture again, I'd assume cheaper labor is part of it.
Speaker 1: But why are the delivery fees so much cheaper in
Speaker 1: China versus the United States?
Speaker 2: Well, you're right, I mean, for sure, the cheaper labor
Speaker 2: is a big factor. When you look at also the
Speaker 2: way in which restaurants are located next to the public
Speaker 2: that they service. Density is a big part of it
Speaker 2: as well, right, So, I think for me the density
Speaker 2: factor we've touched on a little bit when we reference
Speaker 2: the UK as well, which doesn't have the cheap labor,
Speaker 2: but it certainly has the density of where its population
Speaker 2: is relative to the restaurants. But I think those two
Speaker 2: combined are very much part of it. The other side
Speaker 2: of it is when you look at ELIME and mit on,
Speaker 2: the two primary aggregators in China, they are doing and
Speaker 2: have been doing a lot what stored Ash and uber
Speaker 2: eats are starting to get into as well, which is
Speaker 2: multiple verticals, right. So when you go onto the apps,
Speaker 2: they'll have the WeChat integration, which is the communication device
Speaker 2: that everyone uses, like the WhatsApp in the US, and
Speaker 2: so everyone communicates through that, payment is done through that,
Speaker 2: but they also have through those apps the ability to
Speaker 2: use like an Expedia of Fandango. So there's multiple verticals
Speaker 2: being supported through one interface. So in that sense, when
Speaker 2: you speak to people that have lived in China and
Speaker 2: have worked and used those apps, they say, it's just
Speaker 2: part of the way in which we engage with given services,
Speaker 2: and so I think that obviously drives efficiencies as well,
Speaker 2: because when you've got numerous different things being delivered and
Speaker 2: utilizing the logistics fleet to support, you're driving those economies
Speaker 2: into the oval system as well. And that's one of
Speaker 2: the things that I think we're going to see over
Speaker 2: time when we look at how dawed Ash and uber
Speaker 2: eats need to try and drive better profitability back into
Speaker 2: their businesses, is how do we make logistics more efficient?
Speaker 2: And I think large part of that is about utilizing
Speaker 2: the available fleets of delivery in a more spread fashion
Speaker 2: as opposed to just during the peak day parts of
Speaker 2: when people are eating.
Speaker 1: Yeah, it's interesting, all right. Can you touch on some
Speaker 1: of the ghost kitchen and virtual brand issues that we've
Speaker 1: been hearing a little bit about. You know, we've heard
Speaker 1: about Reef obviously with some issues. I was that Brinker's
Speaker 1: investor day last week, and they're gonna end their Maggiano's
Speaker 1: Classics virtual brand of the Maggiano stores. You know, was
Speaker 1: there just over investment over the last couple of years
Speaker 1: or is there something else going on in those business models?
Speaker 2: Very timely subject, right, We've got obviously the next bite
Speaker 2: out to see three that's happened recently as well. So
Speaker 2: there's there's a lot of people coming out of the woodwork.
Speaker 2: I told you so these things were always destined to fail.
Speaker 2: But look the bis I posted something yesterday. The bicycle
Speaker 2: launched in eighteen hundred and something, right, and the penny
Speaker 2: farthing came out seventy years later from its first the
Speaker 2: wooden bicycle, And today everyone's going around on these forty
Speaker 2: mile an hour electric bikes and it's like, Wow, how
Speaker 2: far has this thing come? And I think we're at
Speaker 2: the Penny Fathers the stage of this right now, right it's there.
Speaker 2: It kind of makes sense. It gets me around, but
Speaker 2: it's not necessarily the most efficient way of us being
Speaker 2: able to transport ourselves. And in that sense, I think
Speaker 2: we're just in a place of innovation evolving. The terms
Speaker 2: ghost kitchens of virtual brands get interwoven unnecessarily. My position,
Speaker 2: ghost kitchens as the hardware and virtual brands are the software,
Speaker 2: and they can operate interdependently of each other. You can
Speaker 2: have traditional brick and mortar brands operating out of a
Speaker 2: ghost kitchen, and you can have virtual brands operating out
Speaker 2: of a brick and mortar kitchen, right, so's they can
Speaker 2: work independently of each other. And certainly in the second
Speaker 2: book we reference the fact there are different types of
Speaker 2: models out there, different types of ghost kitchens that service
Speaker 2: the needs of what you are after versus others. Same
Speaker 2: with virtual brands, right, And it's about trying to assess,
Speaker 2: for the restaurant standpoint, what do you need, what are
Speaker 2: your strengths, where are your opportunities? Because part of the
Speaker 2: challenge that's come with having so much money invested into
Speaker 2: not just ghost kitchens and virtual brands, but just general
Speaker 2: restaurant technology in general. What's come with that is a
Speaker 2: huge level of expectation, you know, the founders and one
Speaker 2: now myself is we get this money, and we get
Speaker 2: this money and with then the promise of returns, and
Speaker 2: that means the expectations are set in such a way
Speaker 2: and that leads to large sales forces being developed very quickly,
Speaker 2: and as a result of that, the potential and the
Speaker 2: propensity I would argue for over selling and overpromising and
Speaker 2: ultimately under delivering. And I think that's part of the
Speaker 2: challenge that has existed over the last few years, which
Speaker 2: I think, given the slightly tighter investment environment right now,
Speaker 2: is actually creating a better model for us. Right We're
Speaker 2: going to run better businesses now with the fact that
Speaker 2: there's less money around and we've got to create a
Speaker 2: business model that works. And so I'm not saying that's
Speaker 2: necessarily the case with all Ghost Kitchen and virtual brand models,
Speaker 2: but when you think about the thing that has encouraged
Speaker 2: restaurants into working with the Ghost Kitchen, it's because it
Speaker 2: seems too good to be true. So you're saying, this
Speaker 2: great idea that I've got for a food concept, I
Speaker 2: now can come in and pay a few thousand dollars
Speaker 2: rent and not have to deploy seven figure capital some
Speaker 2: I'm into developing my own brick and mortar restaurant, and
Speaker 2: everyone goes, well, that's fantastic, I'll do that. And what
Speaker 2: they've forgotten about is what we talked about earlier is
Speaker 2: that you still have to create brands that can resonate
Speaker 2: and reach the customer when you don't have any physical doors.
Speaker 2: It's why the virtual brands out there that are succeeding,
Speaker 2: like the mister Beistsburger, that have the reach right, that
Speaker 2: have the presence through celebrities, they're the ones that still
Speaker 2: seem to be resonating and succeeding. You only need to
Speaker 2: look at Pinky Cole's venture Slutty Vegan, which you know
Speaker 2: she's not a celebrity as such, but she gets digital marketing.
Speaker 2: She gets the importance of creating digital engagement. She recognizes
Speaker 2: the way in which if you create that connection in
Speaker 2: digital environments, you can create both a virtual and a
Speaker 2: physical relationship with your customers, which is why they're Texas launchries.
Speaker 2: Recently they had thousands of people queue up to get
Speaker 2: their first taste of Texan Slutty Vegan. So I think
Speaker 2: part of it, the get rich quick mentality has been exposed,
Speaker 2: and I think there's been a lot that have realized
Speaker 2: that not every model works for them, and I think
Speaker 2: it's about trying to recognize that there is a place
Speaker 2: for them, but it's about making sure you make an
Speaker 2: informed decision so that the model works for you as
Speaker 2: well as for the operator.
Speaker 1: Yeah, that's great. I agree. You know, just from a
Speaker 1: capacity utilization standpoint, right, like using a virtual brand to
Speaker 1: you know, in a kitchen that's being underutilized, or using
Speaker 1: a ghost kitchen to help alleviate pressure on a kitchen
Speaker 1: that's absolutely jammed on a Friday and Saturday night. I
Speaker 1: think there's always going to be a need for that.
Speaker 1: So it's going to be very interesting to see how
Speaker 1: it all shakes out. All right, great, so let's talk
Speaker 1: about Juicer a little bit. Can you just talk I
Speaker 1: guess about how it got started and how you got
Speaker 1: affiliated with the team of Juicer.
Speaker 2: Yeah. So Juicer came as a result of an idea
Speaker 2: from our chairman, Drew Patterson, who was the former CMO
Speaker 2: found a CMO over at Kayak and the CEO of
Speaker 2: jet Sets. So he came in from the travel e
Speaker 2: commerce space, and Ashvin our CEO, built a e commerce
Speaker 2: company in the hotel space as well, used to run
Speaker 2: e commerce for a global hotel chain. So the guys
Speaker 2: came really from seeing a lot of the marketplace challenges
Speaker 2: that hotels had to face and have almost seen the
Speaker 2: playbook that restaurants are going through. It's kind of funny
Speaker 2: in a way because I always call them the claim
Speaker 2: they're going to tell They're always telling me about what's
Speaker 2: going to happen next, And you think about that, and
Speaker 2: then you see in which the ways in which our
Speaker 2: our flight tickets and our hotel rooms fluctuating price, Well,
Speaker 2: this has never happened in restaurants. You know. I posted
Speaker 2: something a few days ago about this little boy that
Speaker 2: was running a lemonade stand, and it's a TikTok video,
Speaker 2: fun very amusing TikTok video. And there's people walking by
Speaker 2: and they say and they said, well, how much is
Speaker 2: the lemonade? And the little boy goes fifty dollars. They go,
Speaker 2: what fifty dollars? That's a lot. And the point by
Speaker 2: me referencing that is that if that little boy had
Speaker 2: taken the typical restaurant approach, he had taken the cost
Speaker 2: of the lemons, the cost of the water, the cost
Speaker 2: of the cups, the cost of the sugar, and come
Speaker 2: up with maybe a price after looking at what the
Speaker 2: other kids are selling down the street. And then when
Speaker 2: the cost of lemons and the cost of sugar increase,
Speaker 2: he might increase his price, right, And that's the traditional
Speaker 2: way of how restaurants price their menus. It's why over
Speaker 2: the last year we've seen two or three blanket price
Speaker 2: increases happen across restaurant menus. But it's such a blunt instrument,
Speaker 2: it really is. And so using demand based pricing, using
Speaker 2: data science to be able to understand that different products
Speaker 2: on a restaurant's menu have different levels of elasticity, and
Speaker 2: to be able to understand, based on the capacity stuff
Speaker 2: that we were talking about earlier, that at different times
Speaker 2: of the week, the restaurant's kitchen is at different levels
Speaker 2: of stress. Isn't there an opportunity to say, well, the
Speaker 2: cheeseburger that's ten dollars on a Monday at three pm
Speaker 2: could potentially be ten dollars and fifty cents on a
Speaker 2: Friday at seven pm. And I want to emphasize that,
Speaker 2: at least with juicer. We put in some very specific
Speaker 2: constraints here, so we asked the restaurant, you know, what
Speaker 2: types of range are they comfortable with, and many of
Speaker 2: them will say, you know, zero to twenty percent. So
Speaker 2: that means you don't get the tailor swift effect, right,
Speaker 2: so that when all the restaurants around them, or when
Speaker 2: you're going to a heat wave, you're not suddenly seeing that,
Speaker 2: you know, drinks prices are five hundred percent of the
Speaker 2: typical price. The point here, I think is is that
Speaker 2: you can use data, much like we are talking about
Speaker 2: with customers. You can use data to make more informed
Speaker 2: decisions around pricing your menus. And that's what our team
Speaker 2: are doing. We take a suite of pos transactional data,
Speaker 2: we put that into our algorithm. Our algorithm is built
Speaker 2: by one of our other co founders who's built one
Speaker 2: of the leading dynamic pricing engines that supports the hotel industry.
Speaker 2: So we've kind of been there and know how these
Speaker 2: things work. And then we take those prices, we deploy them,
Speaker 2: we measure them, we analyze them, we deploy them very
Speaker 2: gradually so you don't get stick a shock effect, and
Speaker 2: then we report back to the restaurants, So the restaurant
Speaker 2: doesn't actually have to get involved at all in really
Speaker 2: doing anything at all that they would otherwise have to do,
Speaker 2: because for us, it's a full service solution. I think
Speaker 2: what's helpful about this then is that if you deploy
Speaker 2: this in the right way, you can then optimize things
Speaker 2: like promotions. You can optimize your e commerce presence. Right,
Speaker 2: you can understand, well, what if I want to drive
Speaker 2: volume at different times, what if I want to treat
Speaker 2: different customer segments differently in different ways, and what about
Speaker 2: if I want to use other data streams? You know,
Speaker 2: so our product over time is going to include weather
Speaker 2: specific events, delivery time raises, the ways in which customer
Speaker 2: ratings play into this. In fact, Mike, I don't know
Speaker 2: where they told you this to you before, but you know,
Speaker 2: we did a survey of a thousand restaurants across fifteen
Speaker 2: different states in the US on Super Bowl Sunday and thought,
Speaker 2: you know, if ever there was a time for restaurants
Speaker 2: to change their price, this would be it. Do you
Speaker 2: know how many restaurants out of those thousands changed their price?
Speaker 2: Not one, not one, not one change of price. And
Speaker 2: it tells you that there's money on the table here,
Speaker 2: So dynamic pricing I think is going to come. We're
Speaker 2: certainly going to see more volatility, but for us this
Speaker 2: is like two three price changes a day at max.
Speaker 2: So a lot of this is about just slowly get
Speaker 2: into this and using more data to make more informed
Speaker 2: pricing decisions and taking money that's on the table. We're
Speaker 2: focused on off premise largely because the customers today are
Speaker 2: would you receive in dynamic prices, It's just it's coming
Speaker 2: through the delivery price, right, and so restaurants aren't benefiting
Speaker 2: a tool from that. So in that sense, we think
Speaker 2: the customer is going to be more accommodating and ultimately
Speaker 2: it's going to help restaurants optimize their off premise margins.
Speaker 1: To yeah, maybe ease the customers into this whole dynamic
Speaker 1: pricing you know type of scenario. And I think it's
Speaker 1: it's really important. They talked about it that like twenty
Speaker 1: percent Governor on't it because I feel like, you know,
Speaker 1: customers could be taken aback in restaurant if the price
Speaker 1: increases are too much. What types of restaurants do you
Speaker 1: think dynamic pricing would work best for?
Speaker 2: Well, certainly those at least for where our business model
Speaker 2: is right now that have off premise focus that have
Speaker 2: a certain amount because you want you have to allow
Speaker 2: the data to take you in the direction you wanted
Speaker 2: to go. So that needs to be a certain amount
Speaker 2: of volume, a certain amount of iterations of transactions to
Speaker 2: to get to a statistical relevance. So there is something about,
Speaker 2: you know, the volume that I think is critical, But
Speaker 2: beyond that, there isn't really a cuisine type that I
Speaker 2: would say this is prevalent towards it price point. I
Speaker 2: think again it comes down to volume, right, So if
Speaker 2: your average tray value is ten dollars, then that's not
Speaker 2: going to work if you've got a million AUV. But
Speaker 2: if you're a Chick fil A, then why not right,
Speaker 2: so that it could work for them very well. The
Speaker 2: other way I would look at it is thinking about
Speaker 2: how you can build the tray valley. Right, So maybe
Speaker 2: the entree prices don't change that much, but if you
Speaker 2: find there's a certain particular time of day where you're
Speaker 2: getting less attachment rate of beverages or desserts or appetizers,
Speaker 2: then maybe use that to reduce those ancillary items to
Speaker 2: build your tray value. Right, So there are different ways
Speaker 2: to approach it, and at the moment we haven't found
Speaker 2: a particular cuisine site that hasn't necessarily worked better or
Speaker 2: worse than another. I think ultimately it's about trying to
Speaker 2: see what resins with customers and using that gradual approach
Speaker 2: to ensure that we don't create any stick of shock
Speaker 2: and no negative guest sentiment.
Speaker 1: Yeah, very cool. You know, I'm interested to see what
Speaker 1: it could do, right in terms of maybe even in
Speaker 1: out the volume in a day, Maybe some more price
Speaker 1: sensitive customers could trade down from a dinner to like
Speaker 1: a mid afternoon discounted meal or something of that nature,
Speaker 1: and kind of maybe ease some pressures on the kitchen
Speaker 1: and stuff like that.
Speaker 2: Nothing would please me more than to see the customers
Speaker 2: train themselves in this. I think it would be amazing. Imagine,
Speaker 2: imagine if restaurants are able to encourage their customers to
Speaker 2: recognize if they order ahead, they can get a bit
Speaker 2: more value. What if you could just move the order
Speaker 2: volume from six pm to five pm? And what that
Speaker 2: could do. If you treat a restaurant kitchen like a
Speaker 2: factory and think about it from that standpoint, then actually,
Speaker 2: there's so much money on the table. I mean, in
Speaker 2: many ways going back to virtual brands, that's what the
Speaker 2: logic of you know, an ihop having a virtual brand
Speaker 2: doing things in the even and not during the breakfast rush. Right,
Speaker 2: So it's all of this is about how do you
Speaker 2: utilize and sweat the acid as best as you possibly
Speaker 2: can in the most optimal manner.
Speaker 1: Awesome, man, Well, I'm gonna end it there. I could
Speaker 1: ask you questions all day once again, if you haven't
Speaker 1: the books delivering the digital restaurant, they're absolutely fantastic. And
Speaker 1: where can listeners find out more about Juicer? And where
Speaker 1: should where should they go to purchase the books?
Speaker 2: I'm glad you asked the books. Well, if you support
Speaker 2: third party marketplaces, you can go to Amazon of course,
Speaker 2: where you can get a kindle me read you the
Speaker 2: book on audible or how back paperback. If you'd like
Speaker 2: to find out more about Juicer, hook me up on LinkedIn,
Speaker 2: but also go to juicerpricing dot com. We'd love to
Speaker 2: hear from you and listen to about your stories about
Speaker 2: how you price and how we can perhaps help all.
Speaker 1: Right, good stuff, Thanks again for doing this, and thanks
Speaker 1: to all the listeners. Have a good day, everybody
Speaker 2: Two