26/05/2022
‘Data’ is not a word we often associate with restaurants; while almost every industry is currently racing to incorporate as much ‘data’ into its process as possible, independent restaurants using data seems a strange, slightly absurd concept.
Consider this scenario: you have two customers in your restaurant. Person A is having a good but not-quite-great time (6 on a scale from 1-7) while Person B is having a relatively poor time (3 out of 7). Most of us have an intuitive understanding Person B should receive the vast majority of our attention, in the hopes that we can salvage their experience and make it better – and that indeed is what generally happens.
This is where ‘the customer is always right’ concept comes from; roughly 80% of customer service effort is spent trying to resolve the experience of very unhappy customers.
However, research shows this intuition is in fact wrong.
From the point of view of maximising revenue, you should in fact focus the majority of your energy and resources on improving Person A’s experience so that they have a terrific time.
But, Why?
Because the happiest customers in any industry tend to spend far more than anyone else. Forrester built data models of customer value in across various service industries, and calculated various scenarios using game theory. They found that, in the scenario described above, if you focus your effort on elevating Person A’s experience from 6 to 7 rather than lifting Person B from 3 to 4, you will earn about nine times more revenue.
This demonstrates the way data can help augment intuition and lead to more financially savvy decision making – and it doesn’t need to have any effect on the human element of your business!
For the full post and further insight on Augmented intuition you can download our free publication ‘The Future of Restaurant Marketing’ on our website.
We hope this has helped, and if you’ve made it this far in the post. Just remember you 𝙧𝙤𝙘𝙠.