Thoughts breed ideas, and ideas lead to action.
And, while no one person in the restaurant business can single-handedly determine where the industry may shift in the future, there are some who have a pretty good grasp on where it’s heading. Below, we talk to three prominent executives in the restaurant & hospitality space – Firehouse Subs CEO Don Fox; President of Little Greek Franchise Development Nick Vojnovic; and Rob Grimes, President of ConStrata Tech Consulting – about what they foresee for the upcoming year.
Q: What’s going to be different about 2014 on the economic front?
Don Fox, CEO, Firehouse Subs: The big question mark for 2014 is the impact of the Affordable Care Act on the pocketbook of our customers. People are just now recognizing that their premiums and out-of-pocket costs are going to be increasing to a significant degree, and this unfortunately leads to a greater challenge for the restaurant industry. Unfortunately, government policies continue to be the primary impediment for growth.
Nick Vojnovic, President, Little Greek Franchise Development: Continued weakness. Any major shocks to the economy could have consumers pulling back.
Rob Grimes, President, ConStrata Tech Consulting: From a technology perspective, it seems that companies are buying and investing in new systems again. Not just because of replacement of old systems and technologies, but to introduce new applications, including new hardware. An example are the recent announcements by two major casual chains to introduce tableside tablet computing for the guest. This goes well beyond just replacing POS, as putting something at every table is a major technology investment. In the QSR and Fast Casual space, you see this as well with digital signage and menu boards to kiosks and line busting technology. Order Confirmation Boards and other drive-thru related technologies are also being upgraded.
Q: As a digital executive, how do you foresee tech and social media impacting operations for 2014?
DF: Social, digital, and technological advances in general will certainly play an increasingly important role in building awareness for our brand. Social media is an increasingly important avenue for us to increase brand awareness and gain trial from new guests. And as the consumer spends more and more time engaged with digital media, the importance of advertising in that space obviously increases. In 2014, it will be more important than ever for brands to determine the appropriate weight to place in this space (and it is not going to be the same for all brands). Technology certainly presents opportunities for refining operations, enhancing profitability, and improving productivity. But in the end, if it does not enhance the customer and/or employee experience, you may not be focusing on the right thing.
NV: The use of social media and technology will continue to become more pervasive.
RG: This is all about guest facing technologies. Clearly, every brand knows the importance of connecting to the guests and using social media as a main gateway. The impact on operations though can be a challenge to a brand that has franchisees, as it takes certain investment to be both connected and also to provide a consistent face to the customer. Not every franchisee wants to make these investments, and as more revenue is actually generated through social media channels, such as mobile couponing and ordering, then there needs to be integration with the store-based systems to fulfill these orders and transactions – this may take upgrading existing systems.
Q: Are you targeting Millennials? How so?
DF: We are turning increasing attention to this demographic. For the most part, it is a matter of ensuring our message is getting into the ears and eyes of the Millennials with sufficient weight. From a creative standpoint, you could see some tweaking of our message. But for the most part, our brand strengths resonate across generational lines (which is a good place to be!).
NV: We are customizing our menu boards to highlight vegetarian, gluten free and local menu options.
Q: Between mobile ordering, mobile payments/wallets and mobile loyalty programs, do you prefer one mobile focus over the other? Additionally, what are your thoughts on mobile retail interaction in general in the restaurant space for the upcoming year?
DF: A tough call, since we would like to be viewed by our customers as offering excellent service in all three areas! As it stands today, mobile ordering is where we are most engaged. We are in the very early stages of mobile loyalty and mobile payment, and it is too early to tell which areas may harbor the most results. Suffice it to say, we need to be engaged in all three spaces with equal fervor. If there is a challenge, it is that not all brands benefit from all three arenas to the same degree. Delivery pizza, for example, benefits to a much higher degree form mobile ordering; it is simply inherent in the operation. Our challenge is to engage in these areas in a way that cost effectively delivers a benefit to the consumer.
Q: How do you see the consumer landscape shifting in the restaurant space in 2014?
NV: The recovery seems to be very weak with concerns regarding the potential negative impact of Obamacare. Consumers are very cautious and have high expectations. Value perception will be key. There does seem to be continued growth in vegetarian options and healthy menu items.
Q: Mobile retail interaction is a hot topic right now. What do you think will move in 2014 regarding one of these?
RG: In many ways this has been limited to the pure retail environment and creating new ways to sell and deliver products and services. But I believe we will see some of the big influencers in this area stepping into foodservice to open up new channels of foodservice sales and non-traditional foodservice establishments. Delivery is an interesting area that could be impacted as we see full-service foodservice offering more options and then at the same time we see the QSR and Fast-Casual segments doing the same – something that has successfully been implemented and achieved outside the US for several years. So integration and interaction of mobile applications on phones and tablets is the way to go. Most major brands have already developed their digital brand and presence through social media and apps specifically designed for these environments. Because of this, the monetization of these apps and bringing increased revenue opportunities is the next big frontier. So clearly following in the footsteps of Mobility in Retail we will see more interaction between the mobile apps and the traditional and non-traditional foodservice outlets of today and then bringing next extensions of these outlets to tomorrow.