If companies have learned anything over the past few years, it’s the importance of agility, which comes from knowing your customers better than anyone else, opening up new revenue channels, trying new ways of doing things, and having the right technology to keep moving forward. In other words, operating like startups.
What helped was that initial action Teppanyaki timepart of the Lucky Dog Mountain Hospitality Group, to beat all odds when they opened a new restaurant in a small mountain town in Georgia at the height of the pandemic. After experiencing a temporary closure due to staff shortages and supply chain issues that forced chefs to travel four hours to buy authentic ingredients, Teppanyaki Time bounced back and built a thriving business.
They are not alone. Most US restaurant owners and operators surveyed by Pop menu reported that their businesses have reached or exceeded pre-Covid levels and that they feel more optimistic about their prospects. However, they remain acutely aware of ongoing economic threats and the need to remain nimble as markets ebb and flow.
Embracing the startup mentality that helped restaurants survive one of the longest roller coasters in modern history is critical in challenging and healthy economic climates. The following are five startup habits that every restaurant should adopt or maintain to protect and grow their business in the future:
1. Startups take full advantage of technology
Startups are squeezing every ounce of efficiency and opportunity out of their tech stack, and restaurants are following suit. From digital marketing and ordering to local service, restaurants are fighting inflation and labor gaps with technologies that can help them increase sales, streamline operations and reduce costs.
The need to do more with the less-than-inspired Phat Eatery in Katy, Texas, to embrace AI-powered phone answering technology that can make calls with personalized responses and send links to callers to make a reservation or place an order. Phat Eatery has handled thousands of calls with this technology, freeing up staff and generating $86,000 in online orders.
Restaurants are also moving away from disparate point solutions to a single platform. According to Popmenu’s research, 40% of restaurant leaders evaluate their technology performance quarterly or monthly – opportunities for factor consolidation into evaluation.
2. Startups make it easy for people to find them
Startups prioritize their digital presence and reach, as do many restaurants considering that the vast majority US consumers decide where to eat online. One in four consumers say one of the most important factors influencing their choice is whether the restaurant appears on the first page of Google search results.
Most restaurant website traffic comes from queries like “restaurants near me”. The more pages a website has that are relevant to the query, the higher the restaurant will appear in search results. Max’s Group Inc., a global restaurant group with multiple locations, has an interactive menu where each dish is treated as its own indexed page, giving Google a wealth of content to crawl. When diners search for “best Filipino food south of San Francisco,” Max’s comes up first.
Max’s focus on search engine optimization resulted in a 58% increase in website traffic in six months. Plus, when consumers view your menu online, they see photos, reviews and likes of individual dishes, giving them all the information they need to order or dine in person.
3. Startups know their customers well
The most successful startups and restaurants are concerned with learning everything they can about their customers’ preferences and behaviors. Contrary to popular belief, this does not require a large investment of time or money; in fact, it can be largely automated.
Ocean Deli Pizza, a one-location restaurant in Wallops Island, Virginia, is a great example. Visitors to his website immediately see a pop-up with an incentive to become a VIP and join his email list, which has grown from zero to 6,000 people over the past two years. Ocean Deli also offers online ordering on their own website versus a third-party site, which allows them to capture more data on what dishes their guests have ordered or liked. All of this helps them automate more personalized email campaigns. Last year, Ocean Deli generated almost $600,000 in online orders and they expect to reach $1 million by 2023.
4. Startups actively seek new revenue opportunities
Whether by adding new revenue channels or leveraging existing ones, startups are continually exploring ways to get more money into their coffers. For restaurants, the ubiquitous adoption of online ordering during the pandemic led to a new trend of hosting special events online that can lead to quick spikes in sales. Events can be more profitable for the restaurant depending on the package they build or the controlled nature of the run (ie limited time offer and designated pickup window).
Chai Pani Restaurant Group hosted a Thanksgiving online ordering event at its Buxton Hall Barbecue restaurant in Asheville, North Carolina. The event, which featured a full Thanksgiving meal with all the fixings, generated more than $13,000 in online sales. It was so popular that the restaurant had to stock up on more turkeys to keep up with orders.
Dashi in North Charleston, SC takes a different approach, offering a series of special online ordering events for specific businesses in their community. The events have helped them build relationships and maintain a steady stream of income.
5. Startup A/B Testing: A lot
In simpler terms, A/B testing is running two versions of something to see which one performs better, a staple of startups. In the restaurant world, this could mean comparing menu items (for example, two burgers with different toppings) or how dishes are presented online with photos and descriptions. For example, R&D Provisions of Atlanta considered which online photo would help bring in more orders for grilled cheese and tomato soup, the sandwich dipped in the bowl or placed on the side.
Restaurants can also use A/B testing to see which marketing headlines grab the most attention or which special offers drive the most business; are they “half price snacks” or “buy one get one free”? The more operators test and measure, the more they learn and earn.
Looking to the future, it is imperative that restaurants continue to operate with a growth mindset, pivot quickly, embrace technology and gather deeper customer insights. Recent history shows that this startup mentality will serve them and their guests well.
BIO OF THE AUTHOR
Brendan Sweeney is the CEO and co-founder of Popmenu, a leader in digital marketing, ordering and on-premise technology working with more than 10,000 independent restaurants and hospitality groups. With a strong background in product development, user experience and marketing for high-growth SaaS companies, Sweeney leads efforts to deliver easy-to-use, immediate impact technology that drives better financial results for restaurants. It can be found on the global conference circuit, industry podcasts and news sites. Prior to Popmenu, Sweeney held senior product leadership roles for Commissions Inc. and CareerBuilder EMEA.
