171. Delivering the Digital Restaurant Part 2 Transcript

1:09:42

Owner: Jeremy Julian

SUMMARY KEYWORDS

restaurant, brand, people, third party, kitchen, guests, consumer, technology, happen, digital, order, food, book, talk, podcast, party, drive, takeout, experience, carl

SPEAKERS

Jeremy (48%), CARL (30%), MEREDITH (21%), Intro (<1%) 

I

Intro

0:02

This is the restaurant technology guys podcast, helping you run your restaurant better.

JJ

Jeremy Julian

0:13

Welcome back to the restaurant technology guys podcast. I thank you guys for coming on every single time we post one of these, I know that when I get a chance to speak to the audience, it’s always fun to hear, hear what you guys have to say. And I love that I love that you guys give me feedback constantly on social media and, and at the shows. Like, like every episode that we’ve had probably the last 40 or 50, we are joined again by guests. But today we are joined by to what I was teasing before in pre show as celebrities. Because if if you don’t know them, by now you guys will get to know Meredith and Carl, both at the end of the podcast. And probably once you get through the podcast, you guys will recognize them from social media, because they’ve been all over it, since they came out with their book, but I’m gonna turn it over to Meredith to let her introduce herself. And then Meredith, if you can pass it to Carl, so you can introduce himself. Tell us a little bit about who you are. And then we can talk a little bit about what you guys have done. That’s been so fantastic for the industry most recently.

MS

MEREDITH SANDLAND

1:10

Yeah, absolutely. So I spent the last 10 years or so in restaurants, I was the chief development officer at Taco Bell and building a whole bunch of Taco Bell’s, your neighbor there in Irvine. And about halfway through that journey, I realized that the omni channel disruption that had affected retail was starting to affect restaurants. So I left there and went to be the founding CEO at kitchen united, which is the Google Ventures back to ghost kitchen. And that is where Carl and I met. So I will actually let him take it from there because our story intersects at that point and becomes our story. Awesome.

CO

CARL ORSBOURN

1:52

Yeah. I always hate following Meredith though, because she’s got such an impressive background. But I had a fun side for might what I call with the first half of my career in the convenience, retail space that culminated in me running the 1000 unit, ampm C store chain. And it was through that really where I saw Jeremy just the changing landscape for food, and also consumers expectations that they were wanting better for your food, healthier food, and they wanted food to be more front and center of their C store experience. And it was only when I left them and started to really be intrigued by the ways in which restaurants and rational technology were starting to emerge and really disrupt this industry, that I met Meredith, who invited me to come and run operations and customer success over at kitchen united and build a business that at that time hadn’t really got a clear definition in terms of what it goes kitchen was. And it was very much at the start of what’s this kind of journey has been for us over these last few years. And it was really through that, that we heard from so many different restaurants, not just the small guys, but a lot of the big chains as well, around the challenges of change. And those challenges were very similar to what I think retailers felt in the early 2000s When ecommerce was bought. And I think it was through that where we were seeing just the the need for more support, more kind of guidance, if you will, for restaurants to be able to have something that helped them on their journey towards digital maturity. And we were driving back from Pasadena where kitchen University was based. And we we said to each other. It’d be great if we could get a book and give that to each of these restaurant clients. hairdressers, yeah, yeah, you gotta go find it, I find it she was. And of course, we had a search and there wasn’t a book out there. And so anyway, they I think we pocketed that idea. And then after we had left kitchen united, we came back to the whole concept of why don’t we write this book and help the industry because we this was all before the pandemic. And of course, as we’ve gone through the pandemic, it turns out that writing a book is actually a perfect pastime, during a pandemic for future reference. Hopefully, we don’t have to go through that again. But the great thing also is, is that we were able to speak to over 100 different restaurant executives, technology executives, people that really are shaping the future of food. And they gave us so many great insights, so much thought leading views on not only what’s happening right now in the industry, but also where things are heading. And I think most people that have read the book, really, hopefully get this indication of this positive change that’s happening, but also the fact that we’re still in the early innings of change. And hopefully those that read it will get that appreciation that if they start with the right mindset, they’re gonna be in a great position to really thrive going forward.

JJ

Jeremy Julian

4:42

I love that. I love that. And for our longtime listeners, they’ve all heard me use the phrase you know, the four wall economics of you know, you’ve only got a certain amount of space but you’ve got oftentimes more capacity than you can you can you know, where you can fulfill more food But you don’t have more seats. And really, you know, oftentimes before the pandemic, everybody was governed by how many seats did they have in the dining room, and they could only expand so much to the amount of seats that they could that they could do. And, and I did a lot of studying even well, before you guys had written the book about kitchen United because it was such an interesting concept. Well, before you know, and again, this podcast has been going for three or four years, maybe five years, where I’m constantly looking at the the adjacent markets, the C store, market, the grocery market, the retail market to figure out because restaurants historically have been such laggards on adopting these types of change. And so when you see people like kitchen, united, and others that are out there, forging a path, it’s such an interesting, interesting place that you guys sat at the center of that to start to understand, and it really, I think, drove the passion behind where the book is at. I don’t know that you guys mentioned either one of you guys mentioned the books, why don’t you guys take a second just to kind of talk about what is the book? How do I teach you guys that you guys are celebrities that you guys are out there, because they see the book, I see your guys’s name in the news constantly. Let’s talk a little bit about the book and what the book is. And then we’ll dig back into kind of how did we get there? We’ll take it back to how did we get there? And and what did that look like? Yeah, sure.

MS

MEREDITH SANDLAND

6:13

So the book is called delivering the digital restaurant, your roadmap to the future of food. And it really is a very wide ranging book, as Carl said, We interviewed over 100 people to be included in the book. So it’s not just our random thoughts, but some of the leading experts in the space who are making these changes happen. And so it is 264 pages packed with all of the change that is occurring now and likely to occur in the future in the restaurant industry. It starts with a long discussion about first three chapters about what’s going on with the consumer. And we talk about that, because I think a lot of people have the feeling that technology is happening to them. And we really want everyone to take away that that is not how technology works, right? The consumer changes. And then technology enables us to take advantage of these changes enables us to serve consumers better. Technology is a tool, and it’s never something that happens to you. It’s something that you use in order to run your business better. So we we would start there. And it seems a little bit far afield, maybe because we’re talking so much about the consumer, and it causes people to say, Well, wait, what does this have to do with digital that it sets the groundwork for all of the ways in which digital helps serve those consumer needs?

JJ

Jeremy Julian

7:34

I love that. Well, and I think I think you know, and I’ve read the book. And I know in general, we talk about it even in our own businesses, that the whole apple effect or the Amazon effect. You know, there’s these other types of retailers that are out there that are really forging the ways to interact with technology that that you might interact with a brand. And so, you know, I’m sure we’ve all done this, and we don’t we I no longer go shop for the best price. If I know that something’s on Amazon, oftentimes, whereas 10 years ago, I would have been like, Well, I’m gonna go look at this store, and I’m gonna look at the store, I’m gonna go look at the store. But Amazon has made it so simple to know that I can order this product that there, there are now continuing to take more and more of my wallet share. And I think the same thing for those Restaurant Brands that have done it. Well, oftentimes, I went to a brand last week because they did a good job of connecting with me digitally. And I was able to interact with that brand, quickly and easily. And I think that all of us as consumers, that is where you have to start technology for technology’s sake never ever works. technology to solve true life problems is what this podcast is about. And it’s really what we talk to our audience members about about when you got your doing that. What kind of pushback did you get? You know, when you when you guys talk to your audience members, you guys talk to the people that have read the book, what kind of feedback are you guys getting, as it relates to kind of that consumer behavior? And you know, those old again, restaurant, oftentimes we’re laggards, they want people to show up to the restaurant and they don’t want to deal with the digital thing. I just want them to show up to my dining room. And, and certainly I’m sure you guys got a lot of that when the book came out. Tell me a little bit about where that came from. What did that look like?

CO

CARL ORSBOURN

9:14

Well, I think the feedback generally has been really positive, largely because it’s written with a very unbiased perspective, we’re not advocating for one particular particular piece of technology. We’re not saying this is the complete pathway. You know, it’s very simple. It’s a very linear pathway you need to follow. We’re trying to meet people where they are. You know, we obviously start with that consumer story, as Meredith mentioned, but we also take people through the basic definitions of what it means to be part of this digital journey. And I think people have appreciated that, you know, the, the area, which I think we’ve had most discussion on the area, which I think has most noise, if you will, is that around profitability, the profitability of off premise, and of course, So what we’re really referring to there is third party marketplace fees. And in chapter seven, we put a whole bunch of panels out there go into the nuts and bolts of it, quite honestly, to really get to the bottom of this one. Because we think it’s that critical. And we’re doing that because it doesn’t matter about all the bits of technology, it doesn’t matter about how exciting we are about this, or the technologists that are trying to sell their platform and their product. If the restaurant themselves don’t believe, if they aren’t willing to take the necessary steps to be able to adapt their entire business model to accommodate this new opportunity. It doesn’t matter how good the technology is. And so, you know, that’s why we talked to the drive thru in chapter three. So the reason we say, you know, drive thru didn’t work when it was just latched on to the side of the building, it was fine, but it wasn’t optimized. And it’s exactly the same with all of these new channels today. And as we explain the profitability piece, Jeremy, we, we tried to demonstrate that if you look at it from a marginal profitability perspective, if you recognize the fact that you’re going to be paying for labor, you’ll be paying for rent anyway. And if you take those cost components out of the transaction, it makes a lot more sense to consider third party. But even without that, you’ve got to look at third parties as a customer acquisition tool, as a means to be able to attract a customer that would not otherwise come to your restaurant, if they were not aware of you through basically, the search that they’re going on to the marketplace for I mean, customers go into a marketplace because a they have a frictionless experience, and B, they don’t necessarily know what they want for dinner that night, or for lunch. And so that’s one of the things which we try to emphasize and then demonstrate the importance of first party having your own channel and the and the techniques around how to convert customers away from a third party and onto your first party channel. But it’s not either or it’s it’s both and we haven’t had negative feedback from people about that argument. But I think that’s probably been one of the most value adding chapters for that reason.

MS

MEREDITH SANDLAND

11:56

Yeah. And I also, I think, let’s dig in a little bit to restaurants being so far behind in technology adoption, because they truly are. But I don’t know that it’s a mindset thing. I don’t know that we have a bunch of like old curmudgeonly people out there, who are, you know, just Luddites refusing to adopt technology? I think what’s happening is that by and large, most restaurants do between I don’t know, say one and $5 million in sales annually. So even if they have great margins, right, even if they have 25% EBIT, da margins, and they’re just killing it 25% of a million, it’s not that much, right? Yep. And yourself a job, right, you just you don’t have that much money to reinvest into technology. And so even the most forward thinking of restaurants and restaurants really are extremely innovative, right, they’re always coming out with new items. And they’re always thinking about new ways to make the guest experience great. Like they’re actually very creative, innovative entities, even the most forward thinking among them is going to be looking at that $250,000, that they’re taking home every year thinking I’m going to reinvest how much into technology. And if I have to do it across multiple sites, it’s going to be so expensive. And so there’s just something about the economics of technology that I think made it very, very difficult for restaurants, to adopt even the things that they wanted to now what’s changing, and what’s become totally different in the last few years, I think two things. Number one, the consumer expectation, as you talked about with something like Amazon has so fundamentally shifted, that they’re like, wait a minute, if I can get this in this vertical of my life, why can’t I get it at restaurants, right, and they’re starting to demand this change. And that that demand for change has been met by people like DoorDash, or UberEATS, showing what that change can look like in the restaurant industry. The second thing was change is what we call the classification of technology tools industry. And for me, that’s been probably the most eye opening thing, leaving a giant brand like Taco Bell, where we spent millions of dollars building our own in house things. You know, in part, because we could and in part, because at that time, those things didn’t exist, you couldn’t just go out and buy it off the shelf. And now you can, for a small monthly fee, you can go out and buy almost anything, any part of the tech stack, any problem you want to solve, you can find someone who’s willing to sell it to you for a monthly fee. And that is such a such a fundamental change in the economics of how you bring technology into a restaurant. That those two things happening at the same time. I think it finally brought the restaurant into the digital age, and then accelerated of course by COVID.

CO

CARL ORSBOURN

14:43

The challenge of course, is that and we see this all the conferences we go to it especially when you speak to an independent restaurant owner operator that perhaps only has a few units doesn’t have a huge support team is now there’s an enormity of options out there. It’s not just well I just want to have a An order management system, there’s so many different order management systems out there. So how do I best choose? And there’s also this entirety of a digital suite that isn’t just front of house, it’s also back of house, everything on the restaurant ecosystem is being digitized, and has been delivered in a relatively cost effective manner, if you will, so that restaurants are going well, this is great. Yeah, I believe even the ones that believe and say, This is where I want to go. They go in, well, where do I start? And how do I make the economic choices that make sense based on where I am for for my current position,

JJ

Jeremy Julian

15:31

or the first thing they do is they listen to the restaurant technology guys podcast, not those things, obviously, teasing, but, but I mean, that’s probably one of the things that I hear most is, is part of what people like about the podcast as I bring relevant, like, I won’t have people on that don’t believe in their product that it actually can solve. I do my due diligence on on these products to make sure that they’re actually going to solve a challenge. The other thing that I want to focus on here, I think you said that I think when you call it the specification of restaurant technology, is up until the last maybe 10 years, maybe even less, most technology providers didn’t play well with others. You know, the big, big technology providers many years ago, were like, Yeah, I’ve got my own walled gardens. You can’t talk to me, or if you do, it’s really expensive. And it’s really hard to talk to me because they were built in the late 80s, early 90s. And so they didn’t have the ability. Now with the the predominance of just different center of the restaurant technologies. I call it point of sale. But you know, we talk about Point of Sale being kind of that heartbeat of the technology stack that’s that’s in there. It’s got to be open. It’s got to have open API’s. You’ve got to be able to talk to it from anywhere, because then you can plug in these different solutions that you’re talking about. And you might use them for a pilot for 60 or 90 or 120 days. Again, I don’t know how long you were at McDonald’s. I mean, I’m sorry, no McDonald’s. I don’t know how long you were at Taco Bell. I used to live right up the street from the one on on Tustin Ranch Road. They constantly were playing with that store. They constantly were trying new technology. That was the store that was my home store. When I was in high school and in college. Like I was constantly at that store. And being in a family that was in the restaurant technology space. I would always go to that one in the Arby’s that was on Branca and and jamboree on the other side of the 405. That Arby’s and that that Taco Bell, were always telling me that was the first store that you guys put

CO

CARL ORSBOURN

17:22

your men to basically do this podcast? Well, it’s just, it makes me

JJ

Jeremy Julian

17:25

laugh, because that goes back 2530 years where they were testing kiosks, you know, because, again, Taco Bell, and some of these big brands, they have the budget, they know where things are at, they have these case studies, they have these user groups that are out there trying to figure out where things are at. So they’re meeting the puck, you know, kind of that whole Wayne Gretzky, we’re going to get the puck where it’s at not where it is today. Because they know they have to or else they’re not going to be relevant. And they’re going to become obsolete. Before we move too much farther, you guys threw out a whole bunch of different words that I want to make sure that we define before we go too much farther, because some of our audience members may be like, what is third party delivery? What is you know, SAS what is digital education, you know, digitization of these things. Let’s go back and let’s talk about some of those those phrases because I think what does a ghost kitchen? You know, you guys give me let’s let’s start there. Talk to me about what is a ghost kitchen, because I’ve heard I have my own podcast where he talks about ghost kitchens. Tell me what your guys’s definition of a ghost kitchen is, before we move too much farther, because I want to make sure that we’re all on level playing field before we before we drive forward so that our audience members are thinking the same way that we are here collectively, the three of us. Sure.

CO

CARL ORSBOURN

18:35

Well, let’s keep it super simple. A ghost kitchen is a facility that is a kitchen that allows you to be able to service off premise guest my guests that are not dining in with you. And they come in lots of different shapes and sizes. Some are have multiple tenants in them. Some are just individual kitchens, but they’ve been designed to be optimized for being able to service off premise guests. Simple as that.

JJ

Jeremy Julian

18:57

Okay, and when you talk about off premise guests, just to clarify off premise being not in a dining room, not in a not in a facility but somewhere else outside of the restaurant.

MS

MEREDITH SANDLAND

19:07

Now include catering, it would include takeout it would include delivery, all kinds of things.

JJ

Jeremy Julian

19:14

I love that. I love that. I love that definition. And that’s great. Before we jump too far into the recording today, audience I want to point you guys back to somebody that’s been a longtime advertiser and a longtime partner of the restaurant technology guys, the guys over a pop menu and they are bringing something even new and related to the guests experience and helping your restaurant to operate better if you remember back from the time that they were on the show. They do a lot in the way of guest experience but their newest product department new entering solution is an AI based computerized technology that helps answer some of those basic questions that you guys have that come into your restaurant from Do you have outdoor seating? Are you know what hours are you guys open? What are reservations available? Do guys take online ordering, do you get some third party delivery? Some of these basic questions that take up your team members, and don’t give them the opportunity to deal with the guests that’s in front of them. They built a solution that is AI driven, not bad AI, but AI that really is humanized, to be able to answer those basic questions for the people that are calling in and allowing your team members the opportunity to interact with the guests that are sitting in your lobby and are coming into the door. For listeners of the podcast, the team over at pop menu has offered $100 off if you go to pop menu.com forward slash tech guys, and your first month will be $100 off of the service. If you sign up for the top menu answering service, I would strongly suggest you guys check it out. Because I know even for myself as a as a guest of restaurants when I’m dealing with the front desk and they’re constantly on the phone, it’s really tough to to interact with them and want to stay there wait. So check them out, pop menu.com forward slash tech guys. What would you call a brand? I’m gonna pick lazy dog just because I know they’ve got to a secondary brand or Chili’s had done a secondary brand, a wing concept out of the existing kitchen. Would you also consider that a ghost kitchen, a secondary brand that is a digital brand that’s getting served out of an existing brick and mortar kitchen. Because I’ve heard people call it a ghost kitchen. I will not call it that.

MS

MEREDITH SANDLAND

21:19

I personally would call that a virtual brand. And the way you’ll like this, since you’re a technology guy, the way that I would compare it is that the ghost kitchen is the hardware. And the virtual brands are the software. Right? So you’ve got you can have a ghost or host kitchen in the case of like a lazy dog or Chili’s or using a host kitchen where it actually it operates a different brand, but it’s hosting the virtual brand. And then the software pieces that brand what is it that you are putting in that hardware environment to put out to the consumer?

JJ

Jeremy Julian

21:54

Okay, would you agree, Carl?

CO

CARL ORSBOURN

21:55

Yeah, absolutely. Okay. You mentioned something earlier, Jeremy, which I also want to come back to as well. And that was this idea of capacity, and D, it’s a phrase that we use a lot in various different media that we’re involved in. And it’s around this idea that restaurants used to be restricted by the amount of tables and the turn time of those tables. And now you’ve got this ability to reach out to 15 minutes worth of distance to customers. And that’s a huge level of capacity that you could potentially service. And so a lot of the operational engineers that are out there, I happen to start to examine, well, actually, how many dishes can I truly put out through my kitchen? Yep. And that’s, you know, that we were speaking to someone just recently, who who does this mobile is actually the CEO of Franklin junction. And he believes that 50% of capacity is available in the average restaurant. So that I would agree with that. I mean, so that kind of tells you imagine having a factory that and his operation 50% of the time, most factories shut if that was the case. Virtual brands are basically using that hardware that infrastructure in a way to be able to take advantage of that spare capacity. Others use Ghost kitchens, sometimes not only as a means to perhaps test and try out new different concepts. They also use it to relieve some of the pressure. You know, we’ve worked with clay in the past and Chick fil A, have used a ghost kitchen a mile away from one of the main brick and mortar locations half a mile, even less, just to be able to give them some relief of the off premise demand that they were facing.

JJ

Jeremy Julian

23:33

Yeah, no. And I think I think I love that you guys are giving those definitions because I think it’s it’s fair. And I think a lot of there’s been a lot of ambiguity about what a ghost kitchen is versus what a virtual brand is, versus all of these things. And, and I think it does create some unique, unique opportunities. I personally have two examples that I want to go through before we get before we get done with the podcast. But I do want to stay on the definition train. You talked about third party marketplace, you talked about third party delivery, give us a definition of what is that mean? There’s lots of them out there. There’s lots of different ways that they go to market. Let’s just make sure that we’re level with that. And then I want to talk about some of the capacity questions because I’ve got two examples from different brands that I’ve worked with, but I’d love to get your guys’s take on that.

MS

MEREDITH SANDLAND

24:16

Yeah, sure. So third party is when there is someone else in between you and the consumer. So anytime there is a third party in that relationship. That is when you know you have say a third party marketplace. First party is when that consumers coming directly to you to place their order. Now even most first party channels aside from maybe the pizza guys and I guess Panera and Chipotle have both announced that they are doing first party actual logistics. The vast majority of people even who have a first party ordering channel are using someone else on the back end for logistics. So they might be using the OLA dispatch product. They might be using the DoorDash drive product, but there’s Generally an outsource party of some kind that’s doing logistics on the backend. So when we talk third party first party, we’re really talking about that front end ordering interface.

JJ

Jeremy Julian

25:10

Okay? And where would you put call center in that because I know a lot of brands have I know we talked about a pre show is that whole call center a lot of our brands talk about, you know, whether it’s call center for the drive thru, or call center for in one of our brands, we’re doing business with torches, tacos, and they’re just so busy in most of their outlets that they can’t take orders fast enough over the phone. They’re trying to drive people to digital, but not everybody wants to do digital, they’re driving home from soccer practice, they want to pick up some tacos on their way home, they want to call the restaurant and get an order and, you know, pull up to a deal and get somebody to bring it out to you. Where would you consider call center in that continuum of digital ordering? And I mean, it’s it’s not technically digital ordering, but it does serve a purpose. Yeah. Third party delivery, you know, does as well.

MS

MEREDITH SANDLAND

25:54

So to me, it’s about who owns the customer. So in that case of torches using a call center, they still own the customer, they might be outsourcing that customer interaction to someone else, that they’re still getting all that customer data, they still own that customer relationship, and to the consumer making that phone call. They probably think they’re talking to churches in play, right? They’re not, they’re not thinking, Oh, I’m talking to, you know, some random third party somewhere who’s taking my order? And then, you know, entering it on the DoorDash, and then flipping it over to George cheese. Right. So

CO

CARL ORSBOURN

26:26

it’s a great scenario, because they’re thinking torches, right? We have a quote in the book where we talk about that idea of saying, Are you are you looking for chicken wings, but you don’t know which brand to choose? Or for Wingstop? Right. And so that whole idea of been our to have a brand resonate in a consumers mind is really, really powerful. And it’s one of the biggest challenges that independents have, in particular, because they need to have their brand stand out. And, and the way to get into that is, of course, creating a great experience for the guest not only in terms of the quality of the food, but also delivering within the timeframes, and also to make sure that the order is indeed exactly what they ordered and have an accurate experience.

JJ

Jeremy Julian

27:05

Yeah, and I’m sure we’ll get into that, because that’s, that is one of the other examples that I was thinking about, I wrote down is some of that, you know, just because a lot of brands are or they want to control the brand experience. And sometimes when you go to third party, it’s stuff. It’s stuff that you struggle with that and one other thing that that I did get to and I’m sure you guys are have heard about this as all the AI solutions for call center. Some of that stuff’s really fun. I was just I’m at RLC, where we last talked. I was talking to the guys from Converse AI, which is an AI solution. You know, it’s just a it’s so intriguing that they can now have a computerized person do that call center portion of it

CO

CARL ORSBOURN

27:43

won’t be long before McDonald’s won’t be having a live person take your order.

JJ

Jeremy Julian

27:47

Yep, no, absolutely haven’t been they tried it with the kiosk. And I think it resonates with some people, but I think the drive thru was going to end up being some form of AI that’s going to do that. And, you know, I know that more and more of the big brands have invested them in McDonald’s has spent millions of dollars buying different digital tools. You know, recently there. I mean, and I know, at our I’ll see that the guy from you know, the CEO of Domino’s talks about them being really a technology company that happens to serve pizza, not necessarily a pizza company that uses technology to you know, and it’s an interesting paradigm shift, but I think it’s going to end up being in certain places. And I’ve talked about it on the podcast many times. So it’s not like it’s brand new, you know, Panera was the same way for such a long time when they did the printer 2.0. It was all about the digital experience as much as it was about about that. So we have two questions that are really just one as a personal experience question that I’d love to have our audience here how you guys would deal with it on the digital front. There was a brand that my family likes to go to. longtime listeners know that I’ve got four kids. So large orders, large family, going to fast casual brands in Southern California. fast casual brand that typically did a pretty good job. You would go in, you would order your food, they would call your number and you know they print or they bring your food out to you whatever. High quality, high quality food did a decent job. We happen to to go to the brand on probably a biweekly basis, couple times a couple times a month, we would go to that brand because everybody would eat there and everybody enjoyed it. Beginning of the pandemic, before they had figured out a lot of this digital stuff. They had gotten inundated with third party delivery. They had gotten inundated with you know it was Taco Tuesday was a Mexican brand Taco Tuesday. So they had gotten inundated with orders. And our experience as a family two experiences in a row was terrible. Because my expectations when I walked up and there was only three people in front of me is that my food was going to come out relatively quick when I got to the cashier and rang up my order. And in both experiences it took a good 30 or 40 minutes to get my food out of this fast casual kitchen because they were inundated, and they had done a decent job of having space for all the third party deliveries that they supported. But as a consumer, I had no idea that their kitchen was backed up 2030 or 40 minutes, had I walked into that brand and had the line been out the door, I most likely would have set a different expectation in my mind. And I know from talking to brands, I know from talking to consumers, that is a problem when you digitize things, and you don’t have capacity to be able to serve that guests. Because again, you walk into a busy restaurant, you’re sitting in the lobby for 20 minutes, but you see a whole bunch of people, showing them know that that’s what to expect. When everything goes digital without that front facing consumer interface. How do you deal with that? Talk to me a little bit about what that looks like? Because I’m sure you guys have had this conversation more times than one? Yeah, well,

MS

MEREDITH SANDLAND

30:48

you know, I would go back to Starbucks, who is kind of the originator in the space. And remember when you would place a mobile order, and you would go in and there’d be all this cups just sitting there. And then everyone was with their dirty consumer meds, touching all the cups looking for their own name. And then they tried to like put a guy there to figure it out. And then COVID happened, they put it behind, and you had to ask for it. Just very confusing process. And then anyone who was walking in the same thing would happen, they’d place their order, and then all of a sudden, they would find out they’re behind 10 Mobile orders. And they’re standing there looking at an empty Starbucks going white, why is my drink taking so long? Now, Starbucks in China has dealt with this. By having actual two separate production lines, they have one for the mobile orders and one for the in store orders. And in fact, in busy stores here in the US, you’ll see that as well, at super large flagship Starbucks, you’ll see multiple lines for the exact same reason. And I think that is the perfect solution. That’s the solution that ultimately drive thru came to where you’ve got a line that’s producing for the drive thru, and you’ve got a line that’s producing for the drive in, and then it really busy locations, you have a third line that is swinging back and forth as needed. So for the very busy restaurants, I think that is the right solution. I think that’s the way to do it. But not everyone can afford that not everyone can retrofit the restaurant, not everyone can put in a second line

JJ

Jeremy Julian

32:07

supply chain, they can’t even get the ovens to get those things happen. Yeah.

MS

MEREDITH SANDLAND

32:13

So in that case, I think there is much more of a digital solution, which Carl talks about quite often.

CO

CARL ORSBOURN

32:19

So I think the exciting thing for us is that we we believe that a dynamic menu can be a way to be able to accommodate for this in the future as well. And it can be can be in a number of different ways, it can be in the sense of helping the customer understand exactly which channel is the most optimized channel to go to if they’re really in a hurry. And when you actually put this in the book, you remember merilis We we have this piece in the book where we say someone’s going through the drive thru, and they spot their sister in the curbside pickup, and the curbside pickup is just a much faster means of being able to get your order, I think consumers are going to really like that to be able to have the choice because some people want to have the experience of the drive thru. It’s fun for some folks. Some people like to be able to go in and actually dine in and just be able to have a moment of relaxation away from the car. And other people just want to be in and out as quickly as possible. And sometimes curbside might be the right way. So giving the consumer the choice. And given the consumer, the expectation is really important. But I also think dynamic pricing is going to start to play a role as we go forward as well. And that of course could be another way. Imagine when you’re really really pushed at the moment. What many restaurants do they turn the third parties off? We can’t cope? Yep. It’s. And that is the equivalent of closing your doors to guess outside your restaurant saying sorry, I can’t come in before. How many would ever do that? That’s not hospitality, is it? And so we need to find a better way of being able to accommodate for that. And the way in which going back to my old world in the the gasoline world, though, how do you do it when you’re starting to have a huge amount of demand coming is you actually raise your prices. And that might be a way of being able to say at different times, you actually are able to increase your prices to be able to offset that. And that might not be across a particular template of every single item on the menu, it might be on the items that you’re starting to run short of

JJ

Jeremy Julian

34:02

right? are the ones that take a long time to produce or whatever else Absolutely. Or

CO

CARL ORSBOURN

34:06

you might choose to reduce the price of those items that are certainly going to be going out of code. So I think there’s going to be a number of ways in which dynamic pricing play a role in changing the profiles of demand as well. But there’s one other thing I’d mentioned which doesn’t fit into either our discussion so far, and that is thinking about the menu itself, thinking about the menu and how long it takes to create each of those items. And assessing the time it takes to be able to do that the first or the base item and making sure that each of your menu items don’t take any more than 10 minutes to abuse. If it takes more than 10 minutes, cut it from your off premise menu really just cut it out, because the third parties will put 20 minutes on and that means you’ll straightaway be outside of the 30 minutes carousel. But then when you’re customizing your orders when you add in various different ways to be able to allow people to modify what they’re choosing to eat. What level of complexity does that create and how much does it take from that standpoint? So, you know, we speak to a company called service physics in the book. And they are operational process engineers, they went through the ins and outs of developing a very optimized drive thru experience of Starbucks. And they just talked about the importance of doing something very simple. And it’s called a spaghetti diagram. And that is where you take a pen, and you leave it on a piece of paper, and you draw the pathways of the making your food. And basically, you do that time and time again and see the places of waste from the overall process of making a particular item. And that’s in its own right will be illuminating, to be able to say maybe you need to reposition the way in which your line is working to.

JJ

Jeremy Julian

35:36

Yeah, and there’s a whole bunch a whole bunch of commentary that I have on that the first of which goes back to customization. And I think it’s funny, because people need to consider this. Today’s episode is brought to you by the team over at seven shifts, you guys may recognize that name, because they had their founder on the show in July, talking about the inception of what it is that they do related to labor management and staff management and scheduling. Great guy, great origin story related to growing up in the restaurants and solving a real problem for his family’s business. You may also recognize their name because they were recently in the news because they just took a $20 million round of funding from the Union Square Hospitality Group, which those unfamiliar, it’s Danny Meyer’s out in New York City, his group that committed to work with the seven chefs team and help fund their continued growth. For listeners of the podcast, you guys can check out the software for free for 90 days by going to seven chefs.com forward slash restaurant, dash technology desk dash guys. And they would love to talk with you, great restaurant people, great technologists and a really great product. You guys may remember a brand we worked with. That’s only it’s only got one outlet, I think left open. But it’s the brain called stacked. We actually were the were the were the technology providers for stacked. And it was the old executives from BJs that had started stacked and you know, at BJs. Anybody that hasn’t been to a BJs it’s a casual dining brewery brand that, you know, looks like you know, any other casual dining brewery brand, where they had, you know, they had a relatively big menu, you know, a couple 100, maybe 100 for the menu items where you could you could do those things. But when they looked at the menu analysis, a PJs, 15% of the items got modified. As soon as you put technology in front of the guests at stacked, statistically 83% of the orders got modified, because now I can take the tomatoes off when when a burger used to show up. And I knew that tomatoes and lettuce and onions and pickles were on the side, I didn’t really care and I wouldn’t tell the server to take them off. But the minute it was on my phone, or the minute that was on a tablet in front of me, I would now take off the tomatoes because I saw the tomatoes on their own like tomatoes, I’m gonna pick tomatoes off. And it created a huge bottleneck within that brand initially until they could kind of figure out the kitchen operation to ensure that the right food got out to people. And again, I’m sure we’ll get to talking about the food quality. But that was a huge, huge piece of it. The second component that I guess I’ll talk about that’s been been something I’d love your guys’s opinion on is the whole idea of kitchen management and kitchen throttling, and creating some machine learning and AI. We’re in the middle of a project right now where we’re taking kitchen data from kts systems to do exactly what you’re talking about Karl, where we’re figuring out that any any basket, any basket, any order that has chicken on it is typically about 90 seconds slower than a basket that doesn’t have chicken on it so that we can figure out, you know, what, how do we drive people away from chicken because chicken drives the orders out to 11 minutes. So now you’re stuck on that digital order. And so we’re working on some machine learning, and some different things that are going to help with exactly what you’re talking about from order throttling and order management within the kitchen. I guess give me your opinion,

MS

MEREDITH SANDLAND

39:01

frankly, Presley pricing things correctly, right. So historically, in the restaurant industry, I think people know their food costs very well. And they will tell you, Oh, this item has a p max of this. And a cost of sales with this cost of sales, importantly, only includes the food and paper costs, right? And then when you ask them, Well, how much labor does it take to make that item? They’re like, ah, the typical amount like they restaurant people just don’t think that way, right? They think of a person in the restaurant, doing all kinds of things and multitasking, and they don’t think well they spend 90 seconds on this dish. But only 45 seconds on this dish. Or this ingredient is really difficult to prepare it just it’s not part of their, their process or the lexicon. And so as all of this data starts to come to light, we start to realize, oh, actually, different products have very different cycle times and that might mean that we need to produce them in a different way are might mean that we just need to price that into it and not just be thinking about the food costs, but also be thinking about the labor costs associated with that product.

CO

CARL ORSBOURN

40:09

Yeah. And to add to that, just thinking about the the bottlenecks that are involved in the process, so the items that likely do take more time thinking about how to build those earlier into the process as well, especially if they are combined together.

JJ

Jeremy Julian

40:22

Absolutely. Yeah. No, it’s It’s been interesting as you start to look at the data, and I’m sure you guys have gotten lots of this experience, since you guys written the book and what you guys were doing before that just how little people actually use the data to make better business decisions unless you’re at these really, really large brands. And so I’ve got a few more comments and or questions that I’d love your guys’s thoughts on. The first of which it came from one of our clients that I was talking to you about that, you know, before the pandemic was doing 15% of their, their stuff was off premise. Obviously, as soon as the pandemic hit 100% of it needed to be off premise. And then they’re now there. Now their goal is to get back to a mean of 30 or 35% off premise, some other Southern California based brand, but it happens to be BJs that we were talking about earlier, and I was talking to their CIO a few months back about what unique challenges has happened, as they’ve doubled, essentially doubled what their off premise needs to look like. And now they have a full dining room. And he had said, there’s really two big things that they’re trying to solve for. And I guess I’d love your guys’s thoughts on how you’ve seen other solving this. The first of which is is that the right food gets into the right bag at the right time for the right people. And the second is the holding of that food before the third party delivery gets there or the guest gets there. The the management the the order management and food management just even know the physical spacing within the restaurant because now you’ve got double the amount of takeout orders and making that efficient for the takeout person when somebody comes in to come get that. And so let’s talk first about how you guys have seen brands tackle the whole idea of making sure that when I order no tomatoes, that no tomatoes gets on that if I’m sitting in the dining room, and I get tomatoes, and I’m that upset, somebody has a chance to get guest recovery there because I’m raising my hand I’m saying something to manager, I’m fixing it, and it’s going the minute it goes out and that DoorDash or that Uber Eats or they take it away, the chances of you recovering that guests are are a lot less, a lot less. And so how do you how are you? How are people solving that? Because that seems to be one of the number one problems that restaurants, at least from our perspective are continuing to deal with. You want to take that Carl?

CO

CARL ORSBOURN

42:31

Sure. The it’s you’re right, by raising it, I think it’s the number one challenge right now I hear it very consistently across every restaurant operator that we speak to. And I think it comes down to basics, quite honestly, I think it comes down to basics in the sense of having operational processes in place to ensure that everyone that’s involved in the actual making up of that dish, are communicating with each other in a very seamless manner. Now, clearly having the basics like order aggregators in place to ensure that the communication of the order is clearly available for someone to be able to read, that’s really important. Trying to make sure that the make process itself isn’t overly complicated on only one particular station is clearly important. But then just the basic communication between the line cooks, you know that in itself, calling out to say this one’s without tomatoes, you know, that that in itself, I think is though is the practice that we’ve seen, really demonstrates the best level of practice out there. Because it’s

MS

MEREDITH SANDLAND

43:25

that it’s a practice from a surgery room, right? Yeah, Doctor says I’m doing this, the nurse repeats it back to him. And everybody knows exactly what’s happening. And, you know, a surgery, obviously, there’s life or death consequences. And so it’s very important. But you can take that exact same practice and apply it in your restaurant. And by by saying out loud, this is what I’m doing and having someone else confirm it back to you. I think it just makes everyone number one aware of what’s going on. And number two, sometimes you say things out loud, and you realize, oh, why am I doing that? That was not the right thing, right? And that’s a great practice. Another great practice is redundancy, right? So if I check something, and then I hand it off to the expo, he checks it also right? And you don’t assume while the other person did their job, and everything’s fine. You just, you know what mistakes happen? Let’s both check it and we’re much more likely to get it right.

CO

CARL ORSBOURN

44:19

The challenge I think that exists in an off premise context is that Expo now typically the items packaged. In that sense, unlike an item that’s on a plate that you can see to see, well, the person asked for the onions to be removed from the salad. You can see that right now it’s inside a box of some kind. So thinking about that process throughout as opposed to just at the end is really critical. And the other side of it is it’s often the simple things that I think yes. I love going to get Chick fil A all the time. It’s my guilty, guilty pleasure. But they always get my unsweetened iced tea order incorrect. And that’s going to leave on the side of it, say unsweetened iced tea as opposed And I always get sweetened iced tea. But why? It’s super simple, right?

MS

MEREDITH SANDLAND

45:04

It’s an excellent

CO

CARL ORSBOURN

45:08

digital interface. But I’d say you just come into the second part of your question Jeremy, which was about the the holding of food piece. And Chick fil A are also doing some pretty amazing stuff in this in this regard, in the sense that now if I was to leave my home at this very moment, I can actually check a little box, which allows them to trace me and where I am, so that they know when to start to fire that order. Yep. Yeah, that’s really impressive. Because the piece shouldn’t be about how should we best maintain the temperature integrity of the food while waiting for the driver of the customer? It should be about how can I make sure that dishes completely ready at the very moment, the customer drivers walking into my restaurant?

MS

MEREDITH SANDLAND

45:46

How do we store you know, 50 bags? The better question is, how do we improve our throughput so that we only have to store 10? At any given time?

JJ

Jeremy Julian

45:55

Right? Absolutely. Yeah, we had we had somebody on the podcast, probably about a year ago, that had done Toltecs they, you know, they were the toll tag company. And then they started working with Chick fil A and I think Tim Hortons and the Burger King guys to do exactly that to start to. And I think they’re working with Chick fil A now. I don’t remember the exact name, but I’ll put I’ll put it in the show notes. And they had, they were starting to solve that problem. The other thing that I found from people and I’m sure you guys have seen the lockers, the food lockers, you know, which is again another way I just I ordered from Shake Shack the other day, they had everything sitting there, you know, it was I did the digital loader on my phone, on my way home from the office and, and I walked up picked it up and left. It was a fantastic experience. My wife went to Chipotle probably a week ago, and they had a drive thru, you know, order digitally drive thru, and I’m sitting here waiting, and it was an hour before she got home because the drive thru was so backed up because they hadn’t figured it out. I’m not suggesting that ultimate lays are bad and all shake checks are good. I just happen to have two experiences in the last two weeks, partially because we got covered at our house. And so we were ordering some takeout and ordering some in and whoever wasn’t second had gotten over it was the one that got to go out and go pick it up. But it’s interesting how different people have have solved it. In the case of BJs, they had to do redesign. So some of their their brands. And I’m sure all of us have walked into brands and had 234 Or five DoorDash drivers sitting around waiting for their food. And you can even get to those stand at some of these places. And so one of the other brands that we work with is now and I know Chili’s had done it when they did a bunch with the curbside is they now have a different entrance for takeout rather than the the main dining room entrance. And not everybody can do that. You’re right but getting a different place for people to come in that are dining in versus taking out a local brand there in Southern California. The guys from stone fire grill, I know that they do a ton of takeout. And their newest restaurant in Laguna Hills had two different entrances, one for dining and one for takeout. Because you know about 50% of their food was via catering or takeout. And so they realized that they needed to build into the restaurant that so I have like one or two more quick last questions and and it’s really the the one that that that came to mind when we were talking about third party was the whole idea of you guys probably saw the viral Tiktok video of McDonald’s and the 40 or so orders that were sitting there that nobody had picked up. Did you guys see that video? Or did you guys hear about this story? What are what are brands do about that they go third party, they’re now reliant on this third party to pick up their food. But now McDonald’s has got 20 or 30 bags sitting there where the guest is either not getting their food or not getting it in a timely manner. Because you know, and we’ve all heard the stories of people left the food on the wrong door and all of that as a brand. Besides trying to migrate people to first party and we’ll talk about first party. That’s that’s really the last part of what we’d love to do. But if I’m gonna use third party, how do I ensure the guest satisfaction as it relates to that delivery? Because it’s a huge risk. And you put your brand at risk? In my mind, if you do it, you put your brand at risk. If you don’t do it, you put your brand at risk if you do do it. So I get that you’re, you know, taking the lesser of two evils, but how do you ensure that the that the food is gonna get picked up and delivered to the people that you that you need to? Yeah, that’s a tough one. It is. It is. But I think it’s I think it’s something that our audience needs to think about. They need to figure out how are they going to deal with the guests recovery? How are they going to deal with that guests that is now upset because DoorDash never shut up to comfort food and I pick on DoorDash all of them have the problem. It’s not DoorDash or GrubHub or UberEATS, or any of those it’s all of them have the problem in some way shape or form where there may be a problem where the food is not delivered to the guests the way that it needs to be. How would you guys how would you guys tackle that if a if a restaurant tour or brand came to you and said talk to me about this? Yeah. Well,

CO

CARL ORSBOURN

49:53

let’s take the various different steps. So first of all, you’ve got to make sure that the dish is in the right bag. packaging at the point of pickup, right, the piece that we were just talking about before that there are issues in that regard. The next piece is that pickup station that transitionary point, whether it’s manned by a member of your team or otherwise, that is actually supporting that pickup area needs to be really clear on the communication points. And to be able to have a verification process between the driver and the actual individual themselves to be able to say you’re picking up for this person, this kind of order. And that that is really important. Now the other side of it. And as part of the research of the book, I did a bit of DoorDash driving myself. And I kid you not Jeremy, I felt really badly treated by the restaurants that I was supporting. Largely probably because they were either resentful because the third party fees or I was taken away the tips from the people in the in the restaurant, right, all of those kinds of act factors. But for all intents and purposes, drivers are now your new kind of server. They are an extension of your brand. And while they’re not your employee, they are going to go to someone’s home with a mindset with it with a feeling. And if they feel like they have had a great experience at your restaurant just been the way that they’ve been treated by your team. And that they feel like they’ve been treated better than they’re going to go and give a bit bit of hospitality you would hope to when they go and deliver that in front of your consumer. So I think that’s a really important piece. You can’t completely control that with a driver. But certainly you can, you can create a bad experience for a driver. And they can throw that on the front door and what do they care, right. And so that’s a really important one. And the ways in which we certainly did that a kitchen and it was offering free drinks for drivers making sure they had clean restrooms, to use getting to know their first names, you know, helping them feel part of the team, because they are part of the team, whether you like it or not. And then the other part of this is then thinking about the customer feedback cycle. So things will go wrong, for sure. Clearly, the DoorDash is the UberEATS of this world have customer interaction processes which are in place. But there’s also ways for you to be able to connect with your consumer as well to find out about how their experience was. And that could be again, utilizing the packaging QR codes on the packaging to allow customers to be able to share with you their experience, and perhaps to incentivize them, that’s great if they’ve never come to your first party before because you’ve got their contact information. So it’s a way in to be able to draw them across your first party. But more importantly, it’s a way of them being able to move away from going onto Google or going on to Yelp and saying about what a terrible experience it was. And for them to tell you exactly what it’s about. That then gives you the choice to be able to fix that experience and turn a bad experience into a good one. And again, in the book, we talked about this in the hotel world, and how at the MGM Grand in Vegas, the room service folks that were running a lot behind that were 10 minutes, 15 minutes late on their delivery to a room would often take a chocolate glazed strawberry and put it onto the dish as well as a way of saying sorry, we’re late. Now, what stops restaurants from being able to do that same thing?

JJ

Jeremy Julian

52:51

Absolutely. Yeah. And I’ve heard stories of people putting stuff in, you know, and again, there’s a brand, local that the last time I DoorDash, they said, you know, here, let me give you 15% to do first party, which we’ll talk about first party here in a second. But I love that reminder for our audience members out there, guys, you guys have to set the right priority for those DoorDash drivers. And for those UberEATS drivers, you have to set the expectation for them so that they deliver on behalf of your brand. If you treat them poorly to your point, Carl, they’re probably not going to treat your guests the same way that you would want them to. But if you make it clear, where do they park? How do they get into your brand? How do they pick up the food, how quickly can they get in and out because they’re just trying to make they’re trying to make a living themselves, they’re not looking to, they really don’t care as terrible as it sounds, you know, whether your McDonald’s or your Burger King or your Taco Bell, they care that the people that are in there are treating them properly, they can get in and out and do their jobs so that they can make their tips, make their delivery fees so that they can move on with their day. And the clearer you can make that and the faster you can make that is is gonna end up being better for your brand, you treat them poorly, it’s going to end up turning out poorly for your guests.

MS

MEREDITH SANDLAND

54:01

In the case of that specific Tiktok video, the orders weren’t even getting picked up. So you didn’t even have a chance to be nice to the driver. And you could argue well, maybe it’s you know, a history of not being super nice to the driver that caused that to happen. But, you know, with the labor shortage happening that’s happening today, there’s also a shortage of drivers. And therefore, in many ways on the third parties, it’s like competing to get a driver to want to come to pick up your order. And they’re gonna choose places that they know they get the order fast, they’re not wasting their time, they’re going to choose places where they know that the ticket is fairly high and therefore they’re going to get a decent tip from it. And they’re going to choose places where they’re treated nicely. So it’s important to do this things consistently, especially in this environment to make sure that your restaurant is perceived as an attractive place to come get orders. And then you might also think about some menu design things to help improve that right so if you’re a McDonald’s you by definition you You have a low tech restaurant, right? Like, that’s your whole thing is value. So the driver might perceive that while it’s a value brand, I’m probably not going to get a very big tip. Even if there’s a generous person on the other end 20% of a low number is still a low number, right? So thinking through well, how do I drive basket size up on third party orders? What do I do there? How do I make sure that people get everything that they need for me so that a driver is more likely to want to pick it up? Increasingly, we’re starting to see platforms do multiple order, multiple drop. So rather than being point to point, they now pick up orders that are originating maybe in the same restaurant or two restaurants right next door to each other, and then are going to two very similar destinations, houses that are right next to each other. So we’re starting to see that and then I think we will start to see better communication back and forth between the platform and the restaurant, so that they are able to coordinate their times much better, and you’re not going to have a whole bunch of food sitting there waiting, degrading. Yeah,

JJ

Jeremy Julian

56:04

well, and the one thing that the the last thing I would say, that I’ve seen restaurants do, and you’ve got to figure this out is is if food is dying in the window, and you’re in a dining restaurant, you solve that by either remaking the food or walking out to the table and fixing it. But for whatever reason, in third party or takeout scenarios, they don’t necessarily treat it the same as if it’s dine in the window. And so you’ve got to figure out a business process to see that food that’s been there. We all heard the stories of McDonald’s that that throws away fries, because they’ve been sitting there under the heat lamp for too long. Why did why is it any different that it’s sitting in the takeout area, waiting for a DoorDash driver to pick it up, figure out how to solve that problem for that guest. And we’ve all had the bad experience. And we’ve all had the good experience. And we probably even had the three of us, um, certain have had a guest recovery situation where the food was wrong, we reengaged and they fixed it right. And then we’ve also had the flip side where they didn’t even hardly respond to you. And now we think poorly about that brand. But I know that in talking to the restaurant tours that I talked to, and I’m certain you guys talk to these are consistent problems that everybody wants to solve. And I know that your guys’s wisdom and your guys’s experience is really what I was hoping to deliver to the audience. Yeah, well,

MS

MEREDITH SANDLAND

57:15

remember, we are early innings. And so of course, there’s a bunch of things that aren’t quite right. And as we all innovate and get better at it, it’s gonna get better.

CO

CARL ORSBOURN

57:25

One of the things that we also will emphasize around this is packaging, right? Just the fact Oh, yeah, we have a chapter in the book that talks about why pizza works. And just so you think about the pizza box, and how that has become so much better over the years, through everything from the the events for to allow steam out to the actual cover and underneath to make sure the integrity during transit, transit, all of those things are parts to ensure that your food gets to you as good and as good a condition as possible when it arrives at the consumers door. And I’d encourage every restaurant owner operator that listens to this to order and have it summit delivered and do it maybe through a third party, do it through People’s Party and see how consistent the experience is. Because that is fascinating to see what your food looks like after being in the car for 20 minutes.

JJ

Jeremy Julian

58:09

Well, and I would also encourage people to consider and I was talking to one of the executives at the Cheesecake Factory the other day, and their sandwiches come with french fries by default. And every time I get my french fries, they’re terrible. And I tell them, and I’ve talked to them about it. It’s like you know what, guys, the French fries need to just not be part of your third party delivery. Because you know what, the, the the entree was fantastic. The sandwich was fantastic. They did do a huge deal at Cheesecake Factory. Because you guys saw this press probably that they’re averaging $5 million, a restaurant, just in takeout only, you know, third party delivery only, like it’s insane what they’re doing. So they had to figure it out both you know, all of the stuff from from where they’re going to stage everything to to the packaging, and there’s certain stuff that doesn’t travel well, fish doesn’t travel a great, you know, grilled salmon probably is not something that you want to put on every menu unless it’s the only menu item that you have. Because it’s just it’s probably not going to travel. Well. The last piece that I’d love to talk about guys, and I know we’re way beyond kind of probably even the time that I promise you guys, but I’m super intrigued and I hope that you guys are okay with it is really the whole idea of talking directly to your guests when you’ve gotten them acquired through first party or third party to bring them back into a first party ecosystem. Because I think that’s a lot of people’s fears that they’re going to have to pay the DoorDash fees or the GrubHub fees forever. And how do they get to a place where they absolutely can talk directly to the guests whether it’s for guest recovery, or it’s for getting them to order directly from your even if you’re using you know somebody else to deliver the food. How give me some strategies that people can consider when it comes to taking third party and moving them to first party.

MS

MEREDITH SANDLAND

59:46

Yeah, well, I think it first and foremost it’s restaurant one on one. It is basic stuff it is if you are not executing well on first party, no one’s going to use it. And going through as Carl just suggested the Experience of ordering third party versus ordering first party and seeing what it’s like is going to tell you a lot. And if your first party ordering experience sucks, people aren’t going to use it. Right. So start there, start with making it great. Start with making it easy and frictionless. And if you are offering a good experience, you’re much more likely to bring consumers over. If your consumer consumer experiences is not great, guess what? No amount of discounts loyalty offers, nothing is going to convince a consumer that they want to have attic experience.

CO

CARL ORSBOURN

1:00:30

And if I can answer Jack, you know, count the clicks, count the clicks between a third party experience to complete a transaction your first party? That’s a great way of being able to demonstrate how frictionless the processes. Yep, no, I

JJ

Jeremy Julian

1:00:42

love that. Well, and the funny part is, and I’m sure you guys have experienced this as well. order food from your own restaurant through third party and first party, like have it delivered to your house and see how good or bad the experience is. It’s amazing how few people do this. And realize why is nobody ordering third party, because it sucks because you don’t do it. Well figure it out. And you

MS

MEREDITH SANDLAND

1:01:01

should do all your channels, right? You should go through your drive thru, go to your dining, go to your first party, go to all three of your third parties, try them all and see, are they different? What happens?

JJ

Jeremy Julian

1:01:13

Like and look at your competitors and do the same exact thing, right? You know, the guy to your left and the guy to your right, go do those things and go see what they’re doing differently. It’s so amazing to me when I talk to our operators that they just don’t even think to do that. And they are like, I don’t understand why nobody wants to use this channel. And it’s like, Have you tried it yourself? And do you understand what it looks like? Yeah, so what did we miss guys? I know that there’s a lot in the book. And we we’ve gone all over the place. But I really I mean, I’ve loved the conversation. And I hope that it’s been intriguing for our audience. It’s it truly has been I selfishly sit in this chair and go, I learned every single time I get on this podcast, and I’m better for it. And so what did we miss that you guys continue to hear coming through your guys’s interviews your guys’s conversations with with operators? What did we miss talking about today that you guys think needs to get on this podcast before we publish it? Well, I

CO

CARL ORSBOURN

1:02:05

think the first thing I just added something just to the end of your last question, Jeremy. And that was this piece around the customer. You know, customer data is going to be the critical kind of life source, if you will, going forward. And the reason we think that and the reason first party is important is it’s going to enable you to be able to understand your customer in ways that you have never, ever been able to do before. And the best way of me expressing that is imagine the best server in your restaurant, the one that will make maybe your favorite restaurant, you and your your partner goes to think about that and think why is that a great experience. And typically, it’s a great experience, because the server knows you. They ask how the kids are, they remind remember that they had Cabernet Sauvignon last time and they bring it back to you. That’s what we love about hospitality. That’s what we love about dining out. But the thing is, is that those servers don’t exist consistently across every single day part every part of the day and every single restaurant in your chain. But now with data, you can give that experience to every single guest every single time. And I think what we tried to demonstrate through the book is that importance of showing how you get your customer, because suddenly this kind of theme of digital hospitality is going to create an experience for the guests to think why should I always order through my phone, regardless of whether I’m dining in going through the drive thru picking up curbside pickup, the customer is going to get used to that because they’re going to get a better experience from it. You mentioned it at the top about Amazon. The reason Amazon do think so well is because they get you they put the thing that they know you want in front of you. And that’s when

JJ

Jeremy Julian

1:03:39

they don’t want my wife wants and she has a they have a lot of her wallet share because but her I mean her Amazon page looks nothing like mine. And but we live in the same household. We sleep in the same bed, but they know who she is because of her digital experience. And I think that is so underutilized. And to your point. I’ve talked about it multiple times on the podcast, there’s so many times that you have that cheers effect in a restaurant when you walk in and somebody goes, Oh, Carl, I haven’t seen you in two weeks, what’s going on? How was your trip to Aspen? Did you ski whatever, you know, because they know you? Well, we can do that digitally. And consumers are willing to big tech has been doing it for a long time, whether it’s Facebook or Google or Amazon, they know who we are. And the restaurants really need to I think that that that customer data platform or whatever you want to call it is going to be a key to the future. I really, really appreciate you bringing that up because I think it’s it’s critical. It’s really critical. Meredith what what did we miss from your perspective? Anything else that you would add to to the dialogue? Because I think it’s I mean, we could talk forever. I think it’s it’s exciting conversation and, and it’s been a huge joy for me, but what else? What else? Are we missing that you guys are talking with people on a consistent basis? Yeah, you

MS

MEREDITH SANDLAND

1:04:50

know, this is going to be hard to hear because of the shortage of labor and the commodities and everything that’s going on, but I believe there’s going to be a bit of reckoning on the price. up front. And I think that restaurants are going to have to figure that out. And what is exciting to me about all this digital stuff is potentially, we can figure out how to run these restaurants, less expensively than how they’re run today. Whether that’s automating labor out, automating some processes through software, figuring out how to have a fundamentally different footprint, there’s a lot of things that are coming, that someone is going to figure out how to combine them in the right way and bring better value to the consumer, and the rest of the restaurants are going to be racing to catch up. So I don’t know when that’s coming, and I don’t know who’s gonna do it. But I know that it’s out there. And I want everyone to be thoughtful of you know, again, it’s not technology for technology’s sake, like you said, it’s in service of the changing consumer. And I think, at some point, it will be in service of consumer value as well. Yeah,

JJ

Jeremy Julian

1:05:55

I love that. I love that. And I think that’s, that’s spot on. Because I think it’s going to happen, it’s going to happen, I think it’s going to be one of those things that when we look back, you know, when I’m one of my kids look back, or my grandkids look back, they’re gonna they’re not even gonna recognize the restaurants that are today, you know, 3040 years from now, they’re gonna be like, what you did what, like you stood in a line? And, like, why did you do that? Like, the food just shows up, you know, or whatever, I think those kinds of things are going to happen. And we’re going to chuckle about it. And hopefully we’re around to see those days. Yeah. So well, I genuinely am and I’ve got a huge smile on my face, I really have enjoyed our dialogue, I know that we, you know, we met through the book and on social and then got a chance to connect it to restaurant Leadership Conference. But I really appreciate your guys’s thought leadership. I think it’s it’s critical that that our audience hears what it is that you guys are saying not just on this podcast, but in the book, what you guys are continuing to speak about, because it’s coming. And you can put your head in the sand and not deal with it. Or you can look at experts like like the two of you guys and everything that you guys continue to put out there. And, and, you know, just and embrace it, figure out what is what works for your brand. I’ve said it 1000 times on this podcast, you’ve got to figure out what your brand is, and then go figure out how to interact with it. It might not be right, every single thing that we’ve talked about might not be right for every single brand. But some of its right and some of it you’ve got to figure out because if you don’t, you’re gonna get left behind and and your competitors are doing it and they’re taking that wallet share when you’re not. So how do people get in touch with you guys? How do people find the book? How do people you know what what would you say next steps are if they want to engage with you guys on social we want to engage with you guys and and hear all of the cool things that you guys are saying out in the in the industry?

CO

CARL ORSBOURN

1:07:37

Yeah, thanks for that. Well, first of all, it’s been a great pleasure for us to be here as well with you. I mean, everything that you’ve been putting out over each of the podcasts you’ve been doing has been tremendous. And I think all of us that are supporting restaurants in this way, you know, credit credit to you all because I think everyone needs this level of support our books available, of course, through the third party marketplace known as Amazon, but you can direct through us which we’d love to do, which is at delivering the digital restaurant.com. And also we have a little short form podcast ourselves that goes out every Monday, where we just talk for 10 minutes about five of the top headlines from the previous week. There’s so much change happening. We know it’s a weekly kind of cadence just to help people stay abreast of all the change that’s happening. So we’d love to have any of your listeners tune in to that too. And that’s called the Monday minute.

JJ

Jeremy Julian

1:08:23

I love it. I love it. I listen to my first my first episode this week, actually, I was sitting there getting ready. And I was like, Oh, hey, they got a podcast going. I should I should listen to that before we record. So I think you guys did a fantastic job of talking about talking about the different changes in the industry. Well, thank you guys so much for coming on the show. Like I said, I know, I promised you guys that would be less than an hour. And we’re definitely over an hour, but it’s been fantastic. I appreciate what you guys do your audience out there, guys, I know you guys have a million different choices of who to listen to. So I appreciate you guys taking time, every time we post one of these things. give me feedback to different people you guys want to hear out on the podcast world if you guys have got different guests that you guys want me to interview, to hear from some different thought leaders. I’d love to get those recommendations to Carl and Meredith thank you guys so much for your time and everything you guys do not just for the time on the podcast, but everything you guys do for the restaurants because I truly do believe that it is the lifeblood of a lot of communities. And if we don’t save them, we’re going to be in a world of hurt and in the future. And so thank you guys for your time and to our audience. Make it a great day.

I

Intro

1:09:25

Thanks for listening to the restaurant technology guys podcast. Visit restaurant technology guys.com For tips, Industry Insights and more to help you run your restaurant better

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