Food and Beverage Industry: Are You Digital Enough?

Without a doubt, the food and beverage Industry is undergoing a revolution. Naturally, we could mention all the new current trends in the sector by mentioning those related to plants, sustainable development or even snack food, to name but a few. But in a rather more 21st century revolutionary approach, let's take an interest in the digital aspect of our operations.

Digitalization or digital transformation?

Many catering professionals still remain hesitant in the face of digitalization. This is understandable, especially since the majority of us equate digitalization with digital transformation. However, it's important to note that the two are not the same. If the former seeks to optimize our processes through the support of new technologies, the latter sees technology as a way of modifying our processes through the unique and total intervention of robotics.

There is a huge difference in approach between simple digitalization like 3D printers that help personalize products and the Boston Spyce robotic kitchen where all food production is automated. At Boston Spyce, admittedly the human touch in food assembly has been removed and is now simply reserved for the welcoming and seating of guests. In a similar vein, the Café X machine remains a restaurant product offering top customization and high end experience. This totally mechanically-made coffee boasts three single-origin roasts, swirly cappuccinos and a wave from the robot - digital transformation at its best and cheaper than Starbucks.

These completely different approaches are perfectly in step with the times and yet are perceived differently by generations, customer cultures and therefore by professionals. Therein lies the apprehension of restorers to make the move towards digitalization.

What if we digitalize without knowing it?

The best current example of invisible digitalization are the new booking applications dedicated to F&B, (e.g. The Fork Manager app). Many professionals have abandoned the traditional paper reservation book and have embraced this practical application, yet the optimization of this process is still far from becoming standard practice. Professionals have made the paperless crusade their priority, without harnessing the other features and benefits of the tool. They fear that it's not quite developed in terms of added value and are extremely preoccupied with the notion of killing human interaction.

Ironically, when used correctly, booking applications can be the gateway to a treasure trove of useful, practical and essential customer information. For example, automatic restaurant confirmations would avoid many common-place inconveniences and disagreements when it comes to a simple table booking. However, the biggest benefit by far would be the optimization of our facilities. We would, at last, be able to control our performance by analyzing the average occupancy, and hence, better plan our staff, anticipate no shows or cancellations and even guarantee bookings (e.g. credit card numbers will be automatically charged if the client fails to turn up). All this just by using the reporting functions that save time and provide reliable information.

How can F&B software produce new sources of revenue?

With regards to the notion of upselling, the software's first advantage would be increased customer information that would allow for more direct marketing and effective communication with our clientele. In the era of personalization, this process would allow us to generate more sales thanks to thorough knowledge of our customers, and furthermore, these tools would guarantee the long-term safe-keeping of customer information, (previously was lost whenever the restaurant manager left for a new job).

If all this seems obvious, the modernity challenge also comes from the fact that our clients are changing. Not so long ago, the term 'revenue management' was considered a dirty word in the F&B sector, often seen as a hedonistic and pleasurable business, (unlike airlines and hotels where it's always been acceptable to pay extra for a better seat or a room with a view). According to a recent study by Dr Reza Etemad, customers however thought it unfair to pay for a table with a better position.

Today, however, there's a new customer mindset: our panel demonstrates that patrons are now willing to pay for the most prestigious table. It's now very clear that customers view the concept of revenue management from a new angle, (hats off to easyjet for coaching the new generation in the ways of upgrading). Thanks to the new technologies and changing attitudes, F&B can embrace the challenge and start tackling the issue of revenue management with new practical and profitable strategies.

This acceptance and awareness doesn't just open the door to new revenue opportunities, but also to loyalty in the way regular customers are rewarded. In our industry, this simply means being given the best table without always having to pay for it.

Used intelligently, digitalization technology need not necessarily kill off the human touch in our industry, but rather assist in optimizing our team productivity and generate original sources of revenue.

Are you ready to follow and apply the new digital trends in F&B?

EHL Hospitality Business School
Communications Department
+41 21 785 1354
EHL

View source