In the third and final installment of our Guide to Restaurant Guest Acquisition, we cover retention’s role in your acquisition strategy and offer tips for leveraging data to build a healthy guest base.
Once you’ve found and attracted new guests, how do you build a healthy base with high lifetime value (LTV)? The answers are in your restaurant data.
As you start to analyze, consider these four important questions, which should serve as the basis for your guest retention strategy and inform future acquisition efforts.
Four Questions To Ask When Analyzing Restaurant Data
1. Who have you acquired, when, and how?
2. How are your guests progressing through the guest lifecycle?
3. What characteristics do your guests share?
4. How can you influence behavior to mirror the actions of your most valuable guests?
To keep restaurant guests coming back, you first have to take the time to learn who they are, along with their preferences, motivations, and behaviors. Within your data, you can find out what initially drove guests to your business and why they keep coming back—or why they’ve stopped returning—by looking at things like location, visit frequency, average spend, the preferred method of ordering, time and day of visits, marketing engagement, feedback, acquisition campaign/channel, etc.
Focusing Retention Efforts With Cohorts and Segments
Rather than attempt to boil the ocean regarding retention, some brands analyze their data by cohorts, or groups of guests acquired at the same time, to evaluate repeat purchasing, churn, spending, reliance on guest acquisition, and other trends over time. By doing so, they can uncover when exactly guests become brand-loyal and why, and create retention campaigns specifically designed to move them forward in the life cycle.
For example, you might discover once guests reach the four-visit mark, you’ve retained them for life. And so, the challenge then is figuring out how to move cohorts from one to two visits, two to three, and beyond.
Additionally (or alternatively), you can analyze your restaurant data by guest segments based on shared characteristics, such as guests with high LTV, website visitors, online orderers, on-premise guests, weekend warriors, Wi-Fi signups, catering orderers, and more.
To ensure each segment becomes more valuable to your restaurant brand over time, you should be thinking about ways to influence their behavior in a positive way. For example:
Giving weekend warriors a reason to also visit during the week, like Happy Hour or live music
Encouraging email subscribers to sign up for SMS messaging for insider perks
Ultimately, every restaurant brand is challenged with testing different retention strategies to find out what works for their guests. The best win-back campaign for your churn risks may be a free appetizer or a perfectly timed email with menu recommendations based on their order history.
By studying your data, you can identify cross-selling, bundling, or promotional opportunities you may not have previously considered, and use that intel to create irresistible campaigns to meet your goals.
Series Wrap-Up and Next Steps
As we close out this series, remember the best guest acquisition strategies are rooted in data generated by an integrated restaurant tech stack, utilize highly detailed segmentation, and take an omnichannel approach to find and attract the right people at the right time on their preferred platform. But guest acquisition doesn’t end with the first visit.
To build a healthy guest base, restaurants need to regularly leverage their data to identify trends, monitor progression through the guest lifecycle, and develop retention strategies that meet individual needs and preferences as they evolve over time. Furthermore, by unlocking LTV and studying the behavior of high-value guests, brands can positively influence behavior and strengthen engagement across their entire base.
Learn more about Engage, our suite of restaurant marketing tools, and contact us today to find out how Olo can support your retention efforts.
Effective restaurant marketing requires an omnichannel approach to engage guests. And SMS marketing automation—also known as text message marketing—has quickly proven itself to be a valuable tool in a marketer’s tool belt.
Why? On average, SMS open rates are as high as 98% and replies are received within 90 seconds.
Restaurant brands can use this marketing channel to target their most engaged guests on their mobile devices with timely, personalized messages that drive results. To help get you started, we’ve created a quick guide that covers the basics of SMS restaurant marketing, including why it works, rules to know, and ways to grow your audience.
What is SMS Marketing?
SMS marketing stands for “Short Message Service” marketing, often referred to as text-message marketing. Prized by marketers for the immediate, direct connection with guests, the ability to customize and personalize messages, and the timeliness of outreach via SMS automation—it’s no surprise that SMS marketing is driving ROI in all industries.
Why SMS Marketing Matters for Restaurants
The restaurant industry, in particular, has an immediate need for timely, personalized guest communication as demand for off-premise dining and contactless service continues to grow. Restaurants are turning to technologies, like SMS marketing, to help them create a consistent, branded experience for both dine-in guests and online orderers.
The case for SMS marketing is clear, but a successful start depends on two crucial steps: Knowing the rules and driving opt-ins.
Step 1: Know the Rules
SMS Marketing Regulations
Collecting guests’ phone numbers through marketing efforts doesn’t necessarily mean you have clearance to add those numbers to your SMS campaigns. The rules and regulations of SMS marketing are set by the Telephone Consumer Protection Act (TCPA) and the CTIA. It’s important to read, understand, and comply with published regulations.
Get Clear Consent To Opt-In From Guests
Texting guests without their permission is an invasion of privacy and is against the law. To receive SMS marketing messages, guests must explicitly opt-in via mobile or web.
Transactional Messages Are Off-Limits To Solicit Opt-Ins
It’s not permitted to solicit opt-ins to SMS marketing via transaction-based text messages, such as online order updates or reservation confirmations.
So where CAN you solicit opt-ins? Read on to Step #2.
Additionally, new opt-ins must receive a confirmation text after sign-up, including purpose, a reminder that message/data rates may apply, opt-out instructions, and how to access help instructions. (For restaurants running SMS automation through Olo, this message flow is already set up to ensure compliance with regulations.)
Keep Guests Up-to-Date
Access to information about your SMS campaigns should be accessible via your website, in the restaurant, and on any pages where you collect opt-in guest data.
Step 2: Grow Your SMS Marketing Opt-in Audience
Whether SMS automation is the first outreach tool you’re testing or simply the latest in your comprehensive restaurant marketing strategy, these three quick plays will drive opt-ins for any restaurant brand.
Drive SMS Marketing Opt-ins Via Web Forms
Include SMS opt-in fields on all of your guest-facing forms (e.g. waitlist, reservation, website sign-ups, guest WiFi, etc.) to quickly grow your marketable database.
Encourage Guests to Opt-in Using Short Code
Offer your guests an incentive to sign-up to receive SMS messages from your brand simply by texting a keyword to a short code.
Promote on Social Media, Email, and Offline
Remind guests and social followers of the benefits of being kept up-to-date with your restaurant brand via SMS marketing across all channels.
Start Communicating Directly With Guests
SMS marketing has emerged as one of the best and most reliable ways for any brand to connect with its guests. Its use is on the rise, and with good reason: when done correctly, it works. The response rate of SMS marketing is 45%, whereas the email response rate hovers around 6% (Gartner).
Last quarter, we grew our product suite and enhanced our partner ecosystem to enable our customers to do more with less and make every guest feel like a regular. Scroll to learn about our all-new partner program and latest product enhancements—plus, how restaurant brands directly benefit.
Introducing our Spring Release:
Value-based partner program to accelerate innovation
Restaurant Benefit: Easily find the best solutions to scale your brand
Olo Connect is now live! Our new, tiered partner program was designed to help brands identify the best solutions to execute their goals and make it easier for developers to build on our platform. With support from over 300 technology partners, our ecosystem is an agile and flexible way for brands to adopt new and existing technology, without the hassle of building in-house or settling for a siloed technology stack.
Guests can order multiple times—with a single check
Restaurant Benefit: Higher check average and more guest data
With Open Check, guests can order at the table using their mobile device, order multiple times throughout their dining experience while keeping the check open, and pay from their device. The guest and the server can add menu items to the same check. All items ordered will show up on the guest's mobile device, allowing them to tip, make one final payment, and close the check—without waiting on a server.
Pay at Table
Guests pay and tip from their mobile device
Restaurant Benefit: Fewer table touches and more guest data
Guests can now order through a server, then pay and tip digitally by scanning a QR code with their mobile device. Pay at Table offers guests the traditional hospitality experience of interacting with a restaurant team member but eliminates the time spent waiting on the check after the meal. The server can then confirm the check is paid in the POS system.
GDP for All
“Try Before You Buy” demo for our Guest Data Platform
Restaurant Benefit: Discover the possibilities with GDP—using your actual guest data
Restaurant Benefit: More fraud reduction and visibility into blocked transactions
Olo Pay customers can now score and filter orders when deciding whether to approve a transaction, which improves targeting and identifying fraud patterns. In addition, fraud reporting insights provide more visibility into why specific orders are getting blocked.
Better kitchen capacity management
Restaurant Benefit: Manage kitchen throughput more precisely
Our new capacity management feature allows restaurants to cap the number of Olo orders that can be in progress at any given time. This enables brands to manage kitchen capacity beyond traditional methods such as orders-per-window and make-minutes-per-period.
A new way to control the off-premise guest experience
Restaurant Benefit: Eliminate commission and delivery fees on large orders
Brands can now assign their own courier staff to self-deliver large, high-touch Rails orders, including catering. This flexibility enables you to maintain profitability and control the guest experience—communication, on-time delivery, placement, and set-up—when it matters most.
Simplified coupon creation
Restaurant Benefit: Increase orders and save time
Fixed-Price Coupons make implementing targeted discounts simpler than ever. Empower guests to order direct with compelling discounts that match on-premise offerings—without having to change menu pricing for all guests. Just set the special price for an item, group of items, or multiple categories of items; no manual calculations or complex workarounds are required.
Disable and Re-enable Ordering
Digital order management made easier
Restaurant Benefit: In a pinch, easily disable and re-enable online ordering
If there is an unanticipated surge in demand or an unfortunate kitchen malfunction, sometimes store operators need to temporarily disable incoming digital orders to provide a great guest experience. When those unexpected moments arise, authorized users can now easily disable and re-enable online ordering with just a few taps in Expo.
Real-time tracking and automated email notifications
Managing onboarding is now more streamlined thanks to enhanced tracking via our new onboarding table and automated email notifications. The table displays real-time information for each store, allowing onboarding liaisons and franchisees to quickly view settings and see if critical information, like store hours, is missing. Onboarding email notifications let brands know when an update has occurred and eliminate the need for liaisons to constantly check tracker tables.
Ideas for new features come directly from listening to the needs of our customers. We’re proud to lead the industry’s efforts to optimize operations, drive revenue across channels, combat fraud, and harness the power of guest data, and will continue to innovate on behalf of restaurants in Q2 and beyond.
Visit our Spring Release page for additional details. If you’re already an Olo customer, reach out to your Customer Success Manager to learn more about these features. If you’re not using Olo yet, contact our team to continue the conversation.
Quick recap: In the first installment of our Guide to Restaurant Guest Acquisition, we explained why knowing your current guests is critical for finding and attracting new, high-value guests. Additionally, we covered the three key elements to unlocking those insights: first-party data, a restaurant-specific CRM, and an integrated tech stack.
Now comes the fun part: Acting on that intel.
Using guest data and segments, restaurant brands can execute a strategic marketing plan that targets new guests who behave similarly to and share interests with their regulars and VIPs.
Start acquiring new guests today with these proven strategies:
1. Advertise on Social Media
Social media advertising is a powerful tool for finding and attracting new restaurant guests on platforms that they use daily. Because organic reach is largely on the decline, social ads ensure your content is seen by the right people at the right time.
Consider which is more likely and effective: Stumbling upon a billboard for a new restaurant in your area or seeing a sponsored post about the grand opening in your Facebook Feed.
In addition to marketing to existing guests on social media—this is critical for retention and should be part of your overall marketing strategy—some brands target by persona (e.g. demographics, location, interests, age, etc.). This strategy may work for certain brands, but Lookalike Audiences can get you closer to your target market on Facebook and Instagram for less money.
In general, the more refined the audience, the lower the customer acquisition cost (CAC) a.k.a. the amount you have to spend to gain a new guest. To calculate CAC, divide your total marketing expenses by the number of new guests acquired. You can determine if you have a good CAC by looking at your check average. If guests are spending more than it costs to get them in the door, your acquisition strategy is on point.
The key to success, as you may have guessed, is leveraging first-party restaurant data.
How to Find New Restaurant Guests With Lookalike Audiences
Facebook defines Lookalike Audience as “a way to reach new people who are likely to be interested in your business because they're similar to your best existing customers.”
In other words, you choose a source audience—it could be your social followers or a list you upload, such as your email database, website visitors, online orderers, etc.—and Facebook then uses the common qualities of the people in it to target similar people.
Note: You’ll get the most bang for your buck by segmenting your guests first—by lifetime value (LTV) and other attributes that are known indicators of a high-value guest—and creating Lookalike Audiences based on those segments.
By targeting Lookalike Audiences, you can reach potential guests who are likely to patronize your restaurant, and may or may not have heard of it before, with relevant messaging that motivates them to take immediate action (e.g. order online or follow to learn more).
Campaign Ideas for Targeting Restaurant Lookalike Audiences
Segment: Guests who visit more than 3x per month
Promote a new location by targeting people within a set geographic location who have behaviors and interests like your loyal fans in other markets.
Segment: Guests who have booked events or placed large catering orders
Showcase your catering offerings leading up to a big game to people who would likely do the same if they knew about your restaurant.
Segment: Most valuable guests (10+ visits, high check average)
Promote a menu item that high-LTV guests order and target people who behave similarly to and share interests with your MVPs.
Tips for Creating Social Media Ads for Restaurants
Today the average American is exposed to 6K-10K ads per day. To stand out, your ad needs to be relevant to your audience and feature eye-catching visuals, compelling copy in your brand voice, and a strong call to action (CTA). Otherwise, your ad will become white noise or turn guests away.
Examples of Effective Restaurant Social Media Ads
This El Pollo Loco ad is part of the brand’s #NoNakedChips campaign, a fun (and funny) way to present its new Double Loaded Nachos. It features an eye-catching photo, an appetizing description, a catchy hashtag, a memorable punchline, and, most importantly an Order Now button, so users can order directly from the ad.
This First Watch ad targets guests located near its new restaurant location to boost brand awareness and generate excitement for the grand opening. The ad also drives email sign-ups by encouraging people to become a "pre-opening VIP."
This Great American Cookies ad promotes new Pumpkin Spice Cookies. It creates a sense of urgency with a Shop Now button and succinctly explains that users can order online and have cookies delivered with free shipping.
With a data-driven social advertising campaign that leverages Lookalike Audiences, restaurants can lower their CAC and increase ROI.
2. Launch a Google Ads Campaign
According to Google, there are over one billion restaurant searches every month, and “food near me” is one of the fastest-growing search terms. Needless to say, Google advertising represents a huge (largely untapped) opportunity for restaurants to get in front of new guests searching for places to eat.
These Google Ad types can maximize your restaurant’s exposure: Search (text ads at the top of Google search results), Display (image ads on websites), and Video (YouTube ads).
All Google Ads can feature general messaging or promote seasonal offerings, events, catering, and more. They can even run during certain times of the day, like 10 a.m.-1 p.m. for the lunchtime rush or 3 p.m.-7 p.m. on date night, based on your current guests’ behavior.
How Restaurants Can Use Google Search Ads
Rank above your competitors (e.g. Someone searches for your competitor and sees your ad above the link to their website)
Target people searching for restaurants in your area (e.g. 10-mile radius of the restaurant)
Bid on relevant keywords (e.g. “Italian restaurant Syracuse” or “Smoothie near me”) that potential guests are using in their search
Example of an Effective Google Search Ad
This Sprinkles Google Search Ad features a keyword-rich description that includes brand differentiators. Most importantly, users can easily order for pickup or nationwide delivery by clicking on the Google Ad extensions (webpage links) like “Order Today.”
How Restaurants Can Use Google Display Ads
Catch the attention of potential guests with a compelling, on-brand visual
Showcase your menu items and differentiators to users as they surf the web
Promote your offerings on websites that focus on specific, related topics or keywords (e.g. A chicken wings ad on a fantasy football website before game day).
Example of an Effective Google Display Ad
This P.F. Chang's display ad is eye-catching and direct. It invites guests to order lunch by clicking the ad and features an irresistible tagline and image.
How Restaurants Can Use Video Ads
Show off your menu and seasonal offerings to users who are searching for relevant keywords on YouTube or who are subscribed to certain channels (e.g. Eater, Food Insider, Bon Appétit, etc.)
Take guests behind the scenes of your restaurant (e.g. cooking tutorials, meet the team, tour the kitchen, see the farm where the food originates, etc.)
Viewers retain 95% of a message when they watch it in a video vs. 10% when they read it, so YouTube ads can ensure that your restaurant messaging is internalized
Examples of Effective Video Ads
This retro-style Lazy Dog Video Ad shines the spotlight on the restaurant’s new TV Dinners while evoking feelings of nostalgia. It’s short, sweet, informative, and leaves a lasting impression.
This Sonny’s BBQ Video Ad is fun and relatable and speaks to the desire to reconnect with friends and family during the pandemic. The ad shows off some menu offerings, while also appealing to our emotions.
Boost website traffic, phone calls, and foot traffic
Extend your restaurant’s reach far beyond what your brick-and-mortar location and online listings can
Generate brand awareness among locals and visitors
Re-engage guests who haven’t visited in a while
3. Retarget Website and Social Media Visitors
If you’ve ever left a website without buying anything and then seen an ad for that company appear on your social feed or within your search results shortly thereafter, you’ve experienced retargeting.
With retargeting, brands can invite consumers back after they’ve visited their website or social page through hyper-relevant ads that follow the user as they browse the Internet. Given that these people have already expressed an interest in your brand, it’s easier and more cost-effective to advertise to them than to a non-retargeting audience.
How To Set Up Website Retargeting For Your Restaurant
To advertise to your website visitors with Google Ads, you’ll need to add a code snippet to your website: the global site tag and the optional event snippet. This will capture information about your visitors—pages viewed and actions taken—to create remarketing lists. For instructions, go here. Alternatively, you can enable remarketing with Google Analytics.
Once your website is tracking properly, it’s time to set up an audience source for your remarketing list in Google Ads. Your goals will determine who belongs on your remarketing lists. For example:
Visitors of a page (e.g. Viewed catering options)
Visitors of a page who did not visit another page (e.g. Viewed menu, but didn’t order)
Visitors of a page during specific dates (e.g. Father’s Day weekend)
Website visitors in the last 60 days
When you’re ready to launch your Google Ad, you’ll narrow your audience targeting to remarketing and select the appropriate list. For a breakdown of the setup process, check out this blog post.
Just imagine how powerful this kind of retargeting campaign would be if it were paired with a stellar automated email and SMS marketing strategy—now you’re thinking like a world-class restaurant marketer.
Facebook Retargeting For Restaurants
Facebook retargeting is another way to find people who have expressed interest in your restaurant—by visiting your website or engaging with your brand on social media—and make it easier for them to place an order.
To get started with Facebook retargeting, you’ll need to install a Facebook pixel—a small snippet of code—onto your website. This code lets Facebook track your guests and their actions on your site and social media. After you install the pixel, you can set up events to measure essential actions, like placing an online order.
Next, it’s time to create a Custom Audience on Facebook based on those actions, such as people who started an online order but didn’t checkout. Once your Custom Audience is built, you can create a campaign for your specific objective.
The Key To An Irresistible Restaurant Retargeting Campaign
Whether you use Google and/or Facebook, the key to driving conversions with retargeting is to create ads that are hyper-relevant to your audience and have a clear objective. If, for example, you’re retargeting people who visited your seasonal milkshake landing page last month, consider appealing to their sweet tooth.
There should be no guesswork involved when it comes to the CTA. Want someone to reorder or make a reservation? Make it abundantly clear and easy for them to follow through.
Examples of Effective Retargeting Ads
Showcase popular menu items to people who engaged with your Instagram posts or ads in the last 30 days.
Highlight a 5-star review in an ad that retargets your segment of guests who have passed their average frequency (a.k.a. Churn Risks).
Gently remind people who abandoned an online order with messaging like: “Ready to order? Complete your purchase.”
This Facebook retargeting ad from Panda Express promotes a family meal deal and gives guests the ability to Order Now from the ad. The copy and imagery are warm, inviting, and informative.
This is a Google Ad retargeting campaign for Athena Grill (a fictional restaurant created by Olo), which would retarget the restaurant’s website and social media visitors. It’s consistent in messaging, and branding, and has a clear CTA: Order Now.
No matter what strategy—or combination of strategies—you choose, remember that guest acquisition, just like restaurant marketing in general, is an iterative process. What works for your competitor may not work for your brand.
Expect to test different tactics and guest segments until you figure out what drives the most results. Keep an eye on impressions, clicks, cost, conversions, etc., and adjust accordingly.
Once you’ve found the sweet spot—the right platform, content that resonates, and high engagement—you’ll see your CAC drop. But don’t stop there. Keep your ads fresh so that they remain effective.
And, use your restaurant data as a guide. Top brands leverage guest data to reach consumers at just the right time, on their preferred channel, with relevant, personalized messaging based on their behavior.
Stay tuned for the final installment of our Guide to Restaurant Guest Acquisition, in which we’ll cover the importance of retention and outline ways to enhance the guest experience to drive long-term loyalty.
Learn more about our marketing suite and contact us today to find out how Olo can help you attract new, high-value guests via targeted digital marketing campaigns.
At Olo, we believe the future of digital hospitality is sustainable. We’re committed to shaping its evolution by aligning our products, resources, and employees to drive positive change and create a more sustainable future.
On a macro level, our ESG work includes reducing our company’s carbon footprint and identifying opportunities to lessen the environmental impact in our value chain by way of our platform. Additionally, Olo For Good supports nonprofits aligned with our mission and values, including protecting natural resources and reducing waste and emissions.
On a micro level, Olo Green, one of our employee resource groups (ERGs), promotes environmental awareness and empowers Oloites to have an eco-conscious mindset in their daily lives. And Olo’s Volunteer Time Off (VTO) Policy encourages Oloites to contribute up to eight, paid hours per calendar year with eligible organizations of their choosing in their local communities.
In honor of Earth Month, we asked the Olo Green leads—Alex Ray, Customer Support Training Team Lead, and Camille Stone, Customer Support Onboarding Specialist—to share a few ways that restaurant brands and we, as individuals, can be better stewards of the environment.
How Restaurants Can Be More Sustainable
There are countless ways that restaurant brands can reduce their environmental impact, including managing food waste and consumer packaging waste. And as a technology partner for the industry, we recognize that the touch points of our platform can lend themselves to enabling these types of waste reductions.
For example, we responded to California regulatory developments on single-use plasticware in 2021 by rolling out a menu feature that allows brands to require guests to opt-in for single-use utensils and condiments.
Here are some additional ways that restaurant brands can be more sustainable this Earth Month and year-round:
Replace standard light bulbs with LEDs or smart bulbs where possible.
Offer rewards programs or discounts for using refillable cups or containers. For instance, at Starbucks, you can get $0.10 off your coffee and 25 stars if you’re a Rewards member by bringing a clean, reusable mug/cup.
If you manage your own delivery fleet, consider order batching so one delivery person can fulfill multiple orders in a single trip.
Donate leftover ingredients and uneaten food to soup kitchens, food banks, homeless shelters, and religious organizations. Panera, for example, donates unsold baked goods to local nonprofits each night.
Use local, seasonal products and/or grow your own produce.
Set the temperature on your A/C one degree higher. According to the World Economic Forum, the direct and indirect emissions from room A/Cs alone could contribute to as much as a 0.5 degree Celsius increase in global warming by the year 2100.
Add meatless options to the menu to protect the environment from damage caused by livestock farming and fishing practices.
Upgrade to eco-friendly equipment and appliances to save water and energy.
20 Easy Ways We Can All Show Earth Some Love
Ultimately, it’s up to all of us to protect the environment. While the issues facing our planet can feel overwhelming at times, if we each do our part and make more eco-friendly choices each day, we can make a real difference. Here are just a few examples:
Eat more plant-based meals. According to the Stanford Report, if everyone in the U.S. ate no meat or cheese just one day a week, it would have the same environmental impact as taking 7.6 million cars off the road.
Restaurant Tech Stack, Restaurant System Integration, Restaurant Data
The right tech stack will enable a restaurant brand to operate more efficiently, drive guest lifetime value (LTV), maximize revenue, and scale. The key to success—and the biggest hurdle—is twofold:
Identifying which solutions will meet your brand’s unique needs today and set you up for success as you grow
Ensuring that your systems are fully integrated
When faced with the dizzying array of restaurant technologies available today, it’s easy to get overwhelmed. For every restaurant pain point, there is a product (or 10) to address it—from back-of-house to front-of-house, off-premise, and everything in between.
And therein lies the problem: fragmented point solutions. In other words, restaurant systems that don’t talk to one another.
The Impact of Data Silos on Restaurants’ Digital Transformation
Data silos are single databases, repositories, or systems that are not interconnected, making data hard to access and analyze. And they are one of the most significant obstacles in the restaurant industry’s digital transformation.
In some cases, restaurant data is stuck in legacy systems that do not provide a way to export it. In others, the vendor blocks access to your guest data altogether. Even if brands can access their data, few teams have the time or technology to stitch it together.
When data isn’t shared between restaurant systems, brands aren’t getting a comprehensive view of the guest journey (e.g. purchase behavior, visit frequency, dietary restrictions, communication preferences, etc.). And they can’t leverage that intel across departments to make smarter business decisions.
Think of it this way: How valuable is a loyalty program if it’s not directly integrated into your online ordering platform? And how can you effectively retain dine-in guests if your POS doesn’t communicate with your restaurant CRM?
How Restaurant Tech Integrations Work
Restaurant systems can communicate with one another via direct or indirect integrations.
With direct integrations, your restaurant systems connect via common protocols like REST APIs or Webhooks. For example, Olo’s APIs not only ingest restaurant data but also facilitate the flow of data to the brand’s desired destination (e.g. marketing platform, business insights tools, data warehouses, etc.) to power business decisions.
You can think of webhooks as outbound, event notifications that contain payloads of helpful data. For instance, when an online order is placed, Olo can send a notification with information about that order to the restaurant brand’s desired destination.
Alternatively, indirect integrations use third-party software as middleware to enable two systems to connect. Our Omnivore API, for instance, provides indirect connectivity to POS systems.
The Benefits of an Integrated Restaurant Tech Stack
With a fully integrated restaurant technology stack, brands can optimize operations and enhance the guest experience to drive more revenue. Here are just a few examples:
Track inventory so that your online ordering menu accurately reflects what items are available at all times
Streamline communication between front-of-house staff and the kitchen to improve meal timing, reduce waste, and manage guest expectations
View all present and future parties from a single screen at the host stand, with real-time table status updates tied to the POS
See and respond to guest feedback from multiple sources (surveys, Google reviews, social media, etc.) in one place—alongside guest profile context from the restaurant CRM—and analyze trends
Without having to manually reenter data into each system, restaurant brands can reduce training, stress, and human error. And when staff can shift their focus to making every guest feel like a regular, everyone wins.
Ways to Ensure Interoperability
Implementing any new restaurant software or hardware is a big undertaking, so before you do, be sure to thoroughly vet the solution. There’s nothing worse than rolling out a new system only to find out that it doesn’t play nicely with others.
At Olo, we help our customers build integrated tech stacks by remaining a neutral, open platform and offering one of the largest restaurant tech ecosystems on the market. Our partner ecosystem is an agile and flexible way for Olo brands to adopt new and existing technologies, without the hassle of building in-house or settling for data silos.
In addition to consulting brands on best practices for building an integrated tech stack, we just launched Olo Connect, a value-based partner program designed to help restaurant brands navigate the increasingly crowded restaurant tech space.
Each of our Olo Connect Partners offers industry-leading integration and has demonstrated excellence on our platform. Qualifications include tenure on the Olo platform, the number of brands and locations currently supported, and proven customer satisfaction.
Remember: A future-proof restaurant technology stack is made up of systems that seamlessly share data. With proper integrations, brands can operate more efficiently, deliver an enhanced guest experience that maximizes LTV, make smarter business decisions, and drive revenue.
If you’re unsure whether or not two systems work together, ask the tough questions. And don’t be afraid to lean on your trusted technology partners for guidance.
Visit our Partner Directory to learn about our 300+ technology partners and Olo Connect, our new opt-in Partner Program. Contact us today for a restaurant tech stack consultation or to join Olo Connect.
In the first installment of our three-part Guide to Restaurant Guest Acquisition, we explain why first-party data, a restaurant CRM, and an integrated tech stack are key to finding and attracting high-value guests.
One of the biggest priorities for restaurant marketers is driving a consistent stream of people in the door, to the counter, curbside, etc. In other words, guest acquisition: the process of bringing new guests to your business.
Traditionally, guest acquisition in the restaurant industry centered around mass communication (i.e. limited-time offers, newspaper and radio ads, and out-of-home advertising). But just as a restaurant manager would never shout to everyone in the dining room to find out if they’re enjoying their meal, mass communication tactics are impersonal and difficult to measure in terms of effectiveness.
There’s a better way to acquire new restaurant guests.
The first step: Knowing exactly who your current guests are—beyond demographics.
In this three-part blog series, we’ll walk you through the fundamentals of restaurant guest acquisition, so you can level up your marketing plan and, ultimately, drive revenue.
Getting To Know Your Guests—Beyond Demographics
Chances are your restaurant brand already has some sort of guest acquisition strategy in place, but unless you fully understand your current base, you’re likely wasting marketing dollars on attracting low lifetime value (LTV) or even one-time-only guests (e.g. people only motivated by discounts) and the ability to optimize your approach is limited.
So, what does it mean to truly know your guests? We’re not just talking about surface-level demographics like age and location, or even contact information. Restaurants should have all of the following intel and more about each guest at their disposal:
Recency: Time of Last Visit, Last Check, Last Online Order
Visit Trends: Last Waitlist Time, Reservation Time, Wi-Fi Sign-Up
Engagement: Last Email or SMS Clicked or Opened
Personal Info: Name, Email, Zip Code, Anniversary, Birthday
Frequency: Number of Visits, Time of First Visit, Lifetime Frequency
Average Spend: Check Averages, Tips, Online Order Totals
Order Data: Ordered Items, Online Order Source
Restaurant Details: Preferred Location, Last Location Visited
But how do you get all of that information? The secret to unlocking these valuable insights is first-party data, a restaurant-specific CRM, and an integrated tech stack.
What Is First-Party Data and Why Do Restaurants Need It?
First-party data is information that a company collects directly from its guests and owns. This includes all the ways a guest engages with a restaurant brand online, including orders, reservations/waitlist, comment forms, email sign-up, e-commerce, app usage, social media, surveys, and more.
Restaurant software like Olo takes that first-party data a step further by enriching it with sources such as your POS, pay-at-the-table solution, and payment platform, through tech integration.
More than ever, restaurants need first-party data to gain a clear understanding of their guests across the entire guest journey and more effectively tailor the experience to each individual. Remember: If you don’t know how your guests behave, you can’t influence their future behavior.
And yet, some tech vendors either don’t give restaurants ownership of their data or limit their ability to access and use it. The best way to find out who truly owns your data (and, ultimately, your guest relationship) is to dig in and ask the tough questions.
For example, when you pull a covers or online orders report, can you tell exactly how many originated from a source like Google or found your website directly? What about the number of guests who have visited/ordered once, twice, or don’t dine as often as they used to? And, if you can get access to all of your data, can you act on it?
If the answer to any of these types of questions is no, it’s time to reevaluate your restaurant tech stack.
Unlock Guest Insights with a Restaurant CRM
A restaurant CRM (Customer Relationship Management solution) like Olo’s stitches together data from your POS, reservation system, online ordering solution, and other restaurant-specific integrations into a single, unified guest profile—and makes it actionable.
This 360-degree view of each guest enables you to better understand their behavior and preferences, which, in turn, leads to more effective omnichannel communications, real-time personalization across guest touchpoints, hyper-relevant promotions, and revenue optimization.
Note that a standard, run-of-the-mill CRM may be limited in terms of its integration capabilities with your existing restaurant tech stack and what actions you can take to engage guests.
The Importance of an Integrated Restaurant Tech Stack
When it comes to getting to know your guests, the ability to collect and then access data is equally as important as having a restaurant tech stack built with systems that talk to one another. For example, do your POS, payment solution, Wi-Fi, CRM, reservation system (if you’re full-service), and online ordering solution share data? If not, you’re only getting part of the story of the guest journey.
To gain this comprehensive understanding of each guest, including their purchasing behavior, preferences, and long-term value to the business, you need to eliminate data silos.
So, before implementing any new systems, ensure that they integrate with your existing tech stack or take the necessary steps to do so.
Restaurant Data Analysis and Guest Segmentation
With integrated first-party data and a restaurant CRM, brands can analyze the guest journey across platforms and find out where and when guests spend money, what they spend it on, which channels they use to connect with the brand, their opinion of the dining experience, and their lifetime frequency.
In addition, restaurants can use the process of guest segmentation to identify which guests are most valuable long-term. Guest segmentation is the act of categorizing guests based on shared characteristics or behaviors, so businesses can effectively market and cater to the needs of each group.
Restaurant brands might choose to segment guests based on things like:
Lifetime Value (LTV): Visited more than 10 times, ordered within the last month, and check average is over $50
High Probability for Reorder: Clicked an email on a Tuesday, and ordered tacos online after 3 p.m. two weeks ago
Opportunities to Treat VIPs: Number of visits is greater than 20, regularly orders dessert, and anniversary month is August
High Churn Risk: Last visit was over 90 days ago and number of visits is greater than 10
Now, how can we use all of this data and these segments to power a guest acquisition strategy?
In the second installment of our Guide to Restaurant Guest Acquisition, we’ll cover a variety of ways to turn guest insights and segments into a data-driven, omnichannel marketing plan that resonates with your target market. Stay tuned for proven strategies to help you find and attract new, high-value guests that mirror the interests and behaviors of your regulars and VIPs.
Learn more about our restaurant CRM and contact us today to find out how Olo can help you better understand your current base and attract new, high-value guests.
Historically, restaurant leaders won by driving transactions—keeping tabs on cover counts and obsessing over same-store sales. Winning didn’t require that you knew who was dining with you, why, or how often. Some team members knew the guests, but that information didn’t get disseminated to all parts of the business. From a practical perspective, guest data often lives with specific team members, but isn’t brought into finance, marketing, culinary, labor, or real estate decisions.
There has been a fundamental shift in the restaurant industry brought on by changing consumer preferences for personalization (think individualized recommendations from Netflix, Amazon, DoorDash, and Instagram) and the pandemic driving tech adoption everywhere. Winning restaurant brands in every category are personalizing the guest experience to maximize lifetime value.
Before we dive into why and how, it’s important to have a basic understanding of guest lifetime value, also known as LTV.
What is Guest Lifetime Value (LTV)?
Guest Lifetime Value is the estimated profit generated from each individual guest from the first visit through the last. In other words, it’s how valuable a guest is to your business, not just on a transaction basis, but with regard to their recency, frequency, and monetary spend across the entire relationship.
Note: “Lifetime” does not refer to the person’s actual lifespan. No “til death do us part” metrics here.
Why LTV is Essential for Restaurants
Restaurant brands must now harness and act on guest data to remain competitive. In fact, restaurant industry analysts and investors are increasingly considering guest-level economics over same-store sales data.
Given the accelerated adoption of data-driven technology across the restaurant industry, it’s safe to say that any brand that doesn't prioritize LTV is now at risk.
Whether you recognized it or not, this shift did not happen overnight. E-commerce and entertainment giants like Amazon, Netflix, and Disney have been maximizing LTV for years with highly personalized user experiences—a process mirrored perhaps more obviously on social media and through digital advertising. As a result, we as consumers have come to expect things like email campaigns tailored to our unique interests, promotions triggered by our recent purchases, and recommendations based on our viewing history.
The restaurant industry is lagging behind on this front, largely because of legacy POS systems, consumer networks that “own” the guest data, and other fragmented point solutions. These blockers make it impossible to know the value of each individual guest because the data exists only in disconnected silos.
Fine-tune day-to-day operations through revealing insights, such as driving factors for guest loyalty and maximizing them
Analyze different guest segments based on individual behaviors
Quantify results of marketing dollars spent, staff training, menu optimization, real estate selection, and more
Discover exactly where and why guests spend money
Given that acquiring a new guest costs far more than retaining an existing one, increasing the value of your existing guests—with the support of comprehensive guest data—is a critical way to drive growth.
How Restaurants Can Maximize Guest Lifetime Value
Leading brands have proven that restaurants can maximize guest lifetime value, increase frequency and retention, and, ultimately, boost revenue by focusing on individual guest behavior. In the end, the brands that know their guests best and do something with that intel will come out on top.
By harnessing data and analytics—from 100% of guests, not just loyalty or rewards club members—restaurants can tailor every action, communication, and business decision to the behaviors of their most valuable guests.
Knowing exactly who’s behind every curbside order and if they’re also dine-in regulars
Targeting lookalike audiences for the top 20% of your guests on paid search and social media (proven to drive down guest acquisition costs to under $1)
Alerting managers which table touches to prioritize during a busy shift
Having a regular’s favorite drink prepared upon arrival
Moving from Transactional Thinking to Guest Thinking
At the end of the day, transactions still matter. After all, C-level executives continue to get grilled over things like same-store sales and box economics. But, those are output metrics. Input metrics that can be controlled and influenced by focusing on individual guest behavior—things like guest frequency, recency, and spending—drive transactions and therefore profitability.
Transitioning from transactional thinking to guest thinking changes the game for everyone on the team. C-level restaurant executives have to shift their focus from same-store sales to Customer Cohort Charts. Finance now concentrates on guest economics instead of box economics. Marketing starts looking at lifetime return on ad spend versus return on ad spend. The list goes on.
It may sound like a big undertaking, and it is. But budgets are tight, and the last thing you want to do is waste time and money attracting low-value guests. When you make every business decision with your most valuable guests in mind, you can ensure that every dollar spent will have a high ROI and drive profitability for your business long-term.
Ready to Make the Shift?
To effectively drive and leverage LTV, restaurant brands need to be able to access 100% of guest data from a single view and inject it into every part of the business—from operations to marketing. Only then, can they individualize each interaction and make data-driven business decisions that boost revenue, guest loyalty, and operational efficiency, all while bringing acquisition costs down.
The path forward for restaurants is building a profitable future with data and those who focus on guests (and their lifetime value) will win. So the question becomes: Does everything in your brand actually revolve around the guest?
Contact us to find out how Olo can help your brand unlock and maximize guest lifetime value.
In the age of social media, why should restaurant marketing teams put their energy, time, and budget into email? Because every marketer’s north star is investing in the channels most likely to drive results.
Nearly half of smartphone users worldwide chose email as their preferred communication method from consumer brands.
3. Email Marketing Converts First-Time Guests to Regulars
Research shows that email is 40x more effective at bringing new guests back than Facebook or Twitter.
4. Email Motivates Guests to Spend More
The rate at which emails prompt purchases is estimated to be at least three times that of social media and the average order value is 17 percent higher.
How to Build a Restaurant Email List
The importance of a restaurant email list cannot be overstated. For one, your brand owns it. You also have a direct line of communication with guests who have expressed interest in your restaurant and want you to market to them.
While there are a variety of ways to build a restaurant email list, here are a couple of valuable sources to start with:
Within your email campaign strategy, consider every stage of the guest lifecycle and every interaction as an opportunity to deepen your relationship with guests. Leverage these six retention strategies to ensure every guest becomes more valuable to your brand over time.
Marketing automation tools can help you do more with less by instantly sending relevant and personalized communications to guests when they meet predetermined criteria, such as placing their first delivery order or not visiting for 30 days.
Here's some campaign inspiration:
Examples of Strategic Email Campaigns
Convert First-Timers into Regulars
Send an automated welcome/thank you email within 24 hours of an online order being placed, featuring an incentive for a return visit or another online order within a given timeframe.
Encourage Return Visits
When an online order does not contain a particular menu item (seasonal special, high-margin item, new offering, etc.), promote that offering in an automated email that triggers a week after the initial order is completed.
Get Important Feedback
Show guests you care about their opinion by soliciting feedback on specific menu items or their overall ordering experience via an automated email sent within 24 hours of an order being completed.
When a guest signs up for in-restaurant WiFi or your e-club, send a welcome email within 24 hours. Then, seven days later, send a follow-up with links to your social media accounts and an invitation to share photos using your branded hashtag for a chance to be featured.
Email Benchmarks for the Restaurant Industry
When evaluating the effectiveness of your email campaigns, there are a few crucial metrics to keep an eye on. According to Campaign Monitor’s 2022 Email Marketing Benchmarks Report, here’s what good email engagement rates look like for the restaurant, food, and beverage industry:
Open Rate: 18.5%
Click-To-Open Rate: 10.5%
Unsubscribe Rate: 0.1%
If your emails are underperforming, test and learn. Ask yourself:
Are people mistaking your email for spam?
Is your design mobile-friendly?
Are you emailing guests too often?
Is the messaging personalized and relevant?
Just because one email performs well with a particular guest segment, doesn’t mean it’s going to be just as successful with another. Regularly monitor your analytics and pivot accordingly.
When building a lasting relationship with guests, email is a key tool in the restaurant marketing tool belt. Why?
It converts: Targeted email outreach puts restaurant brand messaging directly in front of the guest—prime positioning for them to take action. Opted-in guests trust brands with their data, a key indicator of future sales—57% of consumers say trust in a brand drives their purchase decisions.
It’s personalized: With a restaurant CRM that segments guests by behavior, email marketing can be tailored to individual preferences, driving up engagement and boosting conversion.
It’s always on time: With restaurant marketing automation, email campaigns can be triggered right after the first visit or online order to drive repeat sales. Plus, if guests haven’t visited or ordered in a while, an email can automatically remind them of their favorite menu items.
It’s the foundation of effective omnichannel restaurant marketing: Restaurant brands can boost guest acquisition and retention by providing parallel experiences across email and social media. You can use your restaurant email list to retarget regulars and acquire new, high-value guests by targeting lookalikes on social media platforms.
Guests engage with brands everywhere they have a digital presence, and the next new social platform always generates marketing buzz. In comparison, email marketing might seem old school.
To get ahead, though—especially when marketers are tasked with doing more with less—brands need to focus on the kinds of communication guests are asking for and responding to.
In every step of the journey, guests continue to show that restaurant email marketing is an important part of their experience.
Local listings are critical for restaurant discovery and revenue, yet they’re often taken for granted. Learn what’s at stake when they aren’t actively updated and how listings management software can help.
Local listings management, Restaurant listings management
One of the best ways to ensure guests find your restaurant when looking for places to eat nearby is to keep your local business listings up-to-date and optimized for search engines.
Before we get into how to effectively manage local listings and what’s at stake if you don’t, let’s break down the term.
What Are Local Business Listings?
A local listing is an online profile featuring the name, address, phone number, hours of operation, website, and other essential details about a business located nearby. It can be found on search engines, marketplaces, social media, and other online directories.
Consumers rely heavily on local listings to find businesses that offer the goods and services they’re looking for. As a result, most local listings are free for brands to claim and update.
Why Restaurants Can’t Afford to Overlook Local Listings
Restaurant teams are busier than ever, so it’s not hard to see why some brands don’t consider local listings management a priority. And yet, it’s never been more critical. Here are seven reasons why.
Search Engine Optimization
Now that guests can evaluate everything from cuisine to service model to handoff mode when deciding where to eat, Search Engine Optimization (SEO) is everything. Optimized local business listings increase discoverability and help your brand rank high in search engine results when people are looking for similar restaurants nearby.
Incomplete and inaccurate local listings frustrate guests before they’ve even stepped foot in your restaurant. By ensuring that your listings are completely filled out and feature up-to-date information, you can make sure your guest relationship starts off on the right foot and drive long-term loyalty.
Within a local listing, you can enable guests to easily place an order, make a reservation, join the waitlist, and more—without having to leave the platform where they found your restaurant. The less friction, the higher chance of conversion.
When people can’t easily find, communicate with, or order from your restaurant, you’re alienating potential guests and missing out on valuable revenue. This can be as simple as forgetting to update your holiday hours.
Guest feedback can make or break your business. Inaccurate listings and unanswered questions can lead to negative reviews—a major turn-off for prospective guests.
Accurate local listings help build trust with guests and give them confidence in your brand. This makes them more likely to order and more likely to return.
Control of Brand Image
Restaurants that don’t claim their local listings and let user-generated content alone populate their profile risk damaging their brand image. By curating your online presence with accurate information and professional imagery, you can better control how your restaurant is perceived.
How Local Listing Management Software Supports Restaurants
Regularly updating local business listings is hard work—especially when you have multiple restaurant locations. And human error is inevitable.
When restaurant brands edit their hours, menu and other important details, every listing gets automatically updated through syndicated publishing. In other words, you no longer have to log in to each platform and manually enter the new information for every location.
With listing management software, restaurant brands no longer have to grant access to individual managers, keep track of multiple passwords, worry about human error, etc.
Brands can view conversion data by publisher to better understand website traffic and ROI from each listing. For example, you can see how many guests clicked on your online listing and ordered directly from your restaurant website, then leverage those insights to inform your marketing strategy.
More Direct Orders
By placing direct ordering links in your online listings, you can give guests more ways to discover and order directly from your brand website. With listing management software, it’s easy to meet guests where they are—and drive them to your business.
Listing management software can help your brand rank high across search engines, review sites, and social media by enabling you to claim listings easily, remove duplicates, and implement SEO best practices.
To further understand how restaurants can benefit from a listings management solution, read our Slim Chickens case study, which showcases how the brand has increased direct orders, reduced onboarding time, and gained a deeper understanding of listing ROI with Olo’s Sync.
Remember: when building a restaurant business, it’s better to let your food, ordering options, and guest experience set your brand apart—not a missing or inaccurate local listing.
Learn more about Sync, Olo’s restaurant listing management software, and contact us today to find out how we can help your brand update local listings at scale.
Plus, check out our webinar with SOCi, wherein we discuss how to drive more guests with local SEO and online ordering.
At Olo, everything we do revolves around the belief that personal interactions make people feel valued. We aim to lift up, grow, challenge, and learn from the talented team members whose hard work, savviness, and intelligence keep us inspired and pushing to build an even greater company.
One of the ways we do that is through our Employee Resource Groups (ERGs). Olo Women’s Network (OWN), for example, seeks to bring together individuals who identify as women, and allies, for the purpose of empowering women in the areas of leadership, community, professional development, and equality within Olo and beyond.
In honor of International Women's Day, we asked a few of our women leaders to share some of the wisdom they’ve acquired on their career path so far—from helpful tips to hard lessons learned to what motivates them.
Read their stories and sage advice.
“A mentor once shared with me that sharing and learning from experiences at work is incredibly important for personal and professional growth. When we share our experiences with others, we create opportunities for learning and collaboration. We can gain new perspectives and insights that we may not have otherwise considered. That is why I took the initiative to establish the Olo Women's Network, which is now the largest Employee Resource Group at Olo. My goal is to foster a safe environment where we can share our experiences, collaborate, learn from one another, and form meaningful connections. Creating these opportunities for connection and growth is essential for supporting women in the workplace and promoting a culture of inclusivity and support.”
– Priyanka Mehra, Director of Product Management, Payments
“Take the time to build and invest in a community of people you admire and are inspired by. Not only is it way more fun to celebrate successes with others, but your peers are the ones that will push and challenge you along the way (and also keep you sane!).”
– Janna Sheng, Director of Product Management
“As I've grown in my career, I've learned to really evaluate my priorities and how I can get as much energy and satisfaction out of my work as possible. I am thankful for all of the mentorship, advice, and tough love I received from colleagues, managers, and leaders that helped me uncover how to maximize my joy at work and supported me through difficult transitions. My biggest piece of advice is that each person brings something special to the table, and it's up to each person to figure out what that is and how to incorporate it into their professional lives, even when it's difficult. Stay true to yourself, stay open to feedback, and enjoy the journey!”
– Rachel Nasatka, Head of Business Partners
“The best advice I received was to try to improve something every day. It can be yourself, another person, a problem, or a process. Even if it's a slight improvement, each day is an opportunity to make something better than how you found it.”
– Dominique Streeter, Director of Diversity, Equity & Inclusion
“Never forget how capable you are. Just because you haven't done the exact task you may be asked to do, doesn't mean you don't have all the tools in your tool belt to rise to the occasion. You've probably heard this stat from a Hewlett-Packard Report years ago: Men apply for a job when they meet only 60% of the qualifications, but women apply only if they meet 100% of them. In other words, as Forbes put it, ‘Men are confident about their ability at 60%, but women don’t feel confident until they’ve checked off each item on the list.’ The advice we can take away as women: Be more confident in yourself and your abilities. You've got this!”
– Alayna Sullivan, Director of Corporate Communications
“I consider myself very lucky to have had incredible women leaders who have generously gifted me with their time and mentorship throughout my career. One of the best pieces of advice I’ve received is that you are your own best advocate. Law school taught me how to negotiate on behalf of my clients, but not necessarily for myself—which research has shown to be a struggle shared by many women in traditionally male-dominated industries such as law and finance. With the support and advocacy of my mentors, I’ve learned how to confidently speak up for myself whether it be for new opportunities and projects, better resources, higher compensation, or just sharing my impact and contributions. As I advance in my career, it’s not only my goal but also my responsibility, to pass on this wisdom and to support and amplify other women as my mentors did for me.”
– Jen Wong, Deputy General Counsel
“Stop. Take a deep breath. Realize that you can't do it all and ask for help! It doesn't make you any less of a person. Utilize your circle and gain different perspectives in the process.”
– Ashveen Singh, Director, Compensation
“Make time to focus on your own professional development, no matter what your title or role. It's so easy to get caught up in the whirlwind of the day-to-day if you don't intentionally carve out time to learn a new skill, take stock of your accomplishments, and gain a fresh perspective. Don't hesitate to advocate for yourself. Celebrate your wins! This ability does not come naturally to many of us; it takes time and practice to develop this skill. Cultivate a network of mentors and mentees—both in your line of work as well as in other industries. They don't have to be super formal; you never know where the next inspiration or support you need will come from.”
– Carrie Drstvensek, Director of Product Management
To learn more about the Olo Women’s Network and our DEI efforts, visit our DEI page. And check out our careers page to view all of our open positions.
This week, during the fifth anniversary of Beyond4, Olo’s annual customer conference, our Founder and CEO Noah Glass gave attendees a glimpse at the restaurant of the future—and how we plan to bring that vision to life.
In the video, embedded below, you’re invited to imagine an elevated dining experience wherein every guest touchpoint is enhanced by technology.
Come along as we explore the limitless possibilities for data-driven personalization, optimization, convenience, and overall hospitality across different service models, from drive-thru to delivery, full-service, and beyond.
The average online shopping cart abandonment rate sits at nearly 70%. That means, approximately 7 out of every 10 users that initiate a transaction, don’t follow through. It’s a big problem across industries, but not an unsolvable one.
By taking a guest-centric approach to designing the online ordering and checkout experience, restaurant brands can reduce friction, eliminate barriers to conversion, and create an enjoyable experience for guests that keeps them coming back.
Top Reasons for Cart Abandonment
According to research conducted by Baymard Institute, many factors contribute to cart abandonment. While some reasons for cart abandonment are unavoidable—window shopping, price comparison, saving items for later, etc.—restaurant brands can drive sales and repeat orders by addressing the following issues:
Extra costs are too high (tax, delivery fees)
Mandatory account creation
Estimated delivery time is too slow
Website appears untrustworthy for entering payment information
Long/complicated checkout process
Total order cost not visible up-front
Website had errors/crashed
Not enough payment methods accepted
Credit card was declined
Restaurant location selection is a hassle
Expected handoff mode is unavailable
Advanced ordering is not an option
8 Ways to Reduce Cart Abandonment and Boost Repeat Orders
To ensure guests successfully checkout, restaurant brands need to know exactly where in the online ordering journey guests are dropping off and why. One of the best ways to find out is through usability testing. In other words, testing the online ordering process with real users. This enables brands to spot pain points, collect data, and determine guests’ satisfaction with the process.
Once you’ve determined why guests are ditching their carts, you can start optimizing for conversion. For example:
Intuitive Ordering Interface
If guests aren’t checking out due to a confusing or complicated ordering interface, it’s time to rethink how the menu is organized and the structure of the ordering flow. Guests should be able to quickly find their favorite items, customize their order, and make edits to their cart as they go—regardless of the device they’re using. A clear CTA at each step of the process will help guide guests from start to finish.
Other important considerations:
Give defaults on menu items to eliminate an extra click on items that require customization
Validate a smooth mobile web ordering experience
Limit the number of redirect links that distract from the core flow
While there are many benefits to requiring people to create an account when placing an online order (e.g. data collection, 1:1 marketing, personalizing the guest experience, etc.), it can also be a deterrent for those who are in a rush or don’t want to stress about password management. Registration shortcuts like Borderless checkout, logging in with Google, or the ability to “Checkout as a Guest” could make all the difference. If guest checkout is available, ensure it is the primary CTA, so that guests know they have a choice.
When it comes to optimizing the checkout experience for conversion, less is more. Few steps, limited form fields, and minimal distractions are key to getting guests across the finish line. If there is more than one page, consider adding a progress tracker to show guests where they are in the checkout process.
Multiple Handoff Modes
Limited handoff modes—dine-in, curbside, pick-up, drive-thru, delivery, etc.—can be a real turnoff for guests who have a preferred method of ordering, especially when that information isn’t communicated until the end of the checkout process. Restaurant brands can ensure guests aren’t abandoning their carts for this reason by enabling four or more handoff modes, a strategy proven to increase the conversion rate by 12% or more, according to Olo data.
Transparent Pricing and Delivery
If guests are ditching their carts at the last second, it may be because they’re turned off by the extra costs or longer-than-expected delivery time estimates. Brands can display a cart summary throughout the ordering flow for increased visibility and/or experiment with different placements, wording, or colors to communicate this information on the checkout page. Additionally, live tracking lets guests see their order status in real-time.
Multiple, Secure Payment Options
To establish trust with guests and offer convenience, restaurant brands should consider offering multiple payment options, including digital wallet support (e.g. Google Pay and Apple Pay) and the ability to save cards on file via Borderless checkout. Trust badges are another good way to let guests know that your checkout process is safe and that their data is secure. Examples include safe checkout (e.g. NortonLifeLock, VeriSign) and accepted payment method badges (e.g. PayPal, Visa).
High Authorization Rates for Valid Transactions
If your processor is rejecting credit card payments from legitimate guests, it will negatively impact your cart abandonment rate. The best way to ensure that you’re only rejecting fraudulent transactions is to select a restaurant payment stack that has been optimized with authorization rates in mind.
Regular Q/A testing is critical to ensure that your online ordering platform and checkout process are functioning properly. Slow load time, errors, and crashes can drive away guests long before they checkout. And don’t forget to triple-check discount codes and links to ensure they’re working. With the ubiquity of online reviews, frustrated guests can wreak havoc on your brand’s reputation. Lastly, be sure to Q/A test across devices and browsers, as the majority of online orders are placed on mobile.
While each of these strategies can positively impact the cart abandonment rate, sustainable sales growth is dependent on continuous optimization efforts. When implementing changes, A/B testing can help you determine which adjustments are making a difference for guests.
A/B testing is the proven method to test and validate changes to the ordering funnel. It can be as simple as changing copy to something much more complex, like building new components. A/B tests bring in statistical rigor that enables positive changes to the funnel.
In the end, restaurant brands that prioritize a seamless guest experience at every step of the online ordering journey will reap the rewards.
Whether you’re a one-person department or simply have limited resources, you can maximize your time and budget with these proven restaurant marketing strategies for driving guest retention and acquisition.
Lofty goals, a tight budget, and a small team. Restaurant marketers are all too familiar with this juggling act. But how do you drive retention and acquisition at a time when guest preferences, the supply chain, and the labor market are also in flux?
By staying hyper-focused on your brand-specific goals, embracing automation, and leveraging what you know about your existing restaurant guests, you can maximize both your time and budget.
Start with these proven strategies for restaurant marketing success:
1. Focus On One Realistic Goal
We’ve said it before and we’ll say it again: Don’t try to do it all. Be realistic about what you can achieve—especially if you’re a one-person marketing team.
Instead of wasting time and precious advertising dollars guessing who your guests are, what they like, how they’ll behave, and what channels they prefer, let your data be your guide. That way, you can concentrate on building strategic marketing campaigns with the highest ROI potential.
2. Automate Your Restaurant Marketing Campaigns
Work smarter, not harder. With marketing automation powered by your restaurant CRM, you can set up relevant, enticing, and personalized guest communications, including email, SMS, and push notifications, that are automatically triggered by events or segment criteria.
Give a Warm Welcome: Promote your loyalty program when guests place their first online order or sign up for in-restaurant WiFi
Cross-promote Sales Channels: Let QR code ordering guests know that you also offer curbside pickup and delivery
Boost App Downloads: Direct online orderers to download your restaurant app for a better user experience
Drive Repeat Orders: Make guests crave your food with a tailored message based on their order history and preferences
Win Back Cart Abandoners: Gently nudge guests when they’ve left something in their cart so that they’ll return to order
Show MVPs Extra Love: Incentivize guests with high lifetime value (LTV) with an irresistible offer based on what you know about them
Gather Valuable Feedback: Survey guests to make them feel heard, learn what’s working and what isn’t, and improve the guest experience
3. Optimize Your Social Media Efforts
Managing multiple social media accounts for a restaurant brand is a daunting task. To stay on top of the workload, consider using a posting tool such as Buffer or Hootsuite, that enables you to create and schedule content in advance for automatic publishing across platforms.
If you’re struggling to maintain a steady stream of posts, user-generated content can be a great resource. Reposting photos taken by restaurant guests is an easy way to show them love and add authenticity to your social feed.
Lastly, be sure to repurpose evergreen content so that you’re not constantly reinventing the wheel. Just remember quality over quantity.
4. Retarget Website Visitors and Social Followers
While guest acquisition is a critical part of any restaurant marketing plan, so is retention. It’s essential to not lose sight of those people who have already expressed interest in your brand: website visitors and social media followers.
By setting up a retargeting campaign, you can ensure that your brand stays top of mind long after website visitors leave your site—without doing any extra leg work. An eye-catching ad featuring messaging that resonates with your target audience can be the difference between someone returning to order or not.
Similarly, you can keep social followers engaged with your brand using targeted ads that remind them why they love your restaurant.
5. Leverage Your Existing Guests
When it comes to attracting new, high-value guests, your best resource is your existing base. By targeting lookalike audiences that mirror the interests and behaviors of your current guests, you can save time, lower acquisition costs, and boost ROI for digital marketing across social media and Google.
Sources for restaurant lookalike audiences can be CRM-based—email list, SMS subscribers, etc.—as well as online orderers, social followers, loyalty members, website visitors, and more.
What’s Next for Restaurant Marketing
Looking ahead, restaurant marketers will continue to seek out new solutions and strategies to optimize campaigns, work more efficiently, and maximize their budgets. Here are two examples:
Customer Data Platforms: A CDP like Olo’s restaurant-specific Guest Data Platform gives marketers a holistic view of their guests, which they can then use to power hyper-targeted digital ads and personalized communications.
AI: With the introduction of ChatGPT, the powerful new chatbot tool, the opportunity to do more with less, particularly from a marketing perspective, is sky-high. From writing social media copy to tailoring marketing messages and informing SEO strategy, the applications are endless.
While restaurant brands are faced with a variety of challenges right now, marketers can do more with less by concentrating on attainable, high-impact goals, using marketing automation tools to deliver personalized and timely guest communications, and leveraging existing guests to find and attract new ones.
There was a time when the only way to keep a pulse on guest satisfaction at a restaurant was to hire secret shoppers or collect comment cards. Now, the Internet gives guests the power to share their thoughts—positive, negative, and everything in between—24/7 on review sites, social media, and directly with restaurant brands.
But what do you do with all that feedback? Enter sentiment analysis, a tool that is quickly becoming essential for restaurant brands to manage their reputation, enhance the guest experience, and curb negative trends before they impact sales.
Why Guest Satisfaction Matters More Than Ever
Before we explain what sentiment analysis is and how to use it, let’s talk about why guest satisfaction matters in the first place.
Everyone knows that guest satisfaction can directly impact check size, tip amount, and the number of return visits, but with the ubiquity of online reviews, feedback can also make or break your brand’s reputation, acquisition efforts, and bottom line.
For context, according to the 2020 Local Consumer Review Survey, 93% of consumers look at restaurant/cafe reviews before deciding where to eat—the highest percentage of any industry. The majority of consumers (63%) use Google to find information about local businesses—including reviews, contact info, hours, etc.—and only 48% would consider using a business that has fewer than four stars.
In other words, happy guests equal more revenue.
The Challenge of Managing Guest Feedback
Considering how influential restaurant reviews can be, it’s not enough to simply monitor what’s being said online about your dining experience. Brands must actively engage with all guest feedback—good and bad—whether it’s shared on a public platform like Google, or privately via an automated survey.
Take a second to think about how your brand currently manages feedback. How many platforms do you have to log into to monitor reviews? Do all the right people in your organization have access? How many reviews has your team responded to, and how quickly?
If you’re like most restaurant brands, there’s some room for improvement.
Identifying trends when feedback comes in from multiple disparate sources is nearly impossible. And without context from your restaurant's customer relationship management solution (CRM), there’s no way to connect the dots between reviews and everything that happened during the guest’s visit. On top of it all, few restaurant operators have the bandwidth to manually comb through dozens of reviews and respond thoughtfully.
How Sentiment Analysis Can Benefit Restaurants
Sentiment analysis—the automated process of determining whether guest feedback is positive, negative, or neutral—helps you convert the noise of all those reviews into a crystal-clear signal that allows you to take one-to-one action with guests and team members.
With the right tool, you can:
See reviews from multiple sources—surveys, social media, and Google—aggregated in a single dashboard
View guest sentiment overall, by location, or by category (i.e. service, food, etc.)
Connect individual reviews to guest profiles within your restaurant CRM for added context about their recent visit, frequency, lifetime value (LTV), etc.
Filter reviews by source, location, date, rating, keywords, etc.
Respond to individual reviews without having to log in to multiple platforms
Quickly see which comments have not yet received a response
Monitor trends over time and, when necessary, escalate reviews to the appropriate department
Stay on top of new reviews with custom daily reports delivered right to your inbox
Sentiment analysis can tell you what your guests are thinking, but then what? How do you act on that feedback?
How To Act on Guest Feedback
With sentiment analysis, you have a single source of truth that allows you to evaluate reviews—by content and context—not just the overall rating. Restaurant brands can use this information to identify trends and make targeted improvements that build long-term loyalty and grow profits.
Here are a few ways to make guest feedback actionable:
1. Seize Opportunities for Improvement
The best sentiment analysis solutions categorize feedback by content so you can easily identify opportunities for improvement in all areas of the business, like service, food and drink, value, facilities, overall experience, reservations, waitlist, pickup, and delivery.
You can then drill down into each category to diagnose negative trends before they impact sales—and, most importantly, make the appropriate changes.
For example, if you notice a lot of negative comments about wait times, you can see which shifts are having the most issues, and look for ways to improve. It might mean you need a new restaurant waitlist system that reduces manual work and guesswork for the host staff, uses automated text updates to keep guests informed, and offers the ability to join the waitlist remotely right from your Google listing.
Don’t be afraid to get creative. If multiple commenters say the drink list is too limited, you might consider launching a cocktail naming competition to engage guests and let them know you are working on expanding the menu.
2. Start a Dialogue With Guests
By directly responding to feedback in an authentic and caring manner, restaurant brands can express gratitude, demonstrate hospitality, and show respect and empathy, which builds trust with current and potential guests.
A modern sentiment analysis tool will enable you to reply directly to guests across platforms from a single dashboard with one login. When you spot opportunities to win back guests, invite them to contact you directly so you can make it right. As for positive feedback, be sure to thank the guest and encourage them to connect with you the next time they visit.
3. Personalize the Guest Experience
When feedback is tied to guest profiles in your restaurant CRM, you can use context about their visit history to engage with each guest on a more personal level—online and during their next in-person visit.
Within the reply to an online review, you could reference the anniversary that the guest was celebrating or the seasonal milkshake they enjoyed. And, as a follow-up during their next in-person visit, you could show a positive reviewer your gratitude by having their favorite beverage prepared ahead of being seated, or slip some branded swag into their curbside pickup bag.
This additional layer of context also ensures that operators know which feedback deserves the most attention (i.e. high-LTV guests vs. a one-time guest from a year ago), and can escalate it if needed.
4. Foster Accountability Among the Team
The fact is that restaurant operators simply can’t witness every single guest interaction. As such, they need a way to keep a pulse on their team’s performance. By starting each day engaging with guest feedback and sharing key takeaways with the team, managers can foster a culture of shared accountability.
Consider each guest review and survey an opportunity to praise and constructively coach team members, so that everyone takes pride in the restaurant’s success. Transparency ensures that every team member feels recognized, valued, and aware when improvements need to be made.
For a real-world example, check out this case study to learn how BelAir Cantina, a Wisconsin-based restaurant brand, leverages sentiment analysis.
Signing Off on Sentiment
Feedback management has come a long way since the days of secret shoppers and comment cards. If you’re not leveraging a sentiment analysis tool to monitor guest satisfaction over time, respond directly to feedback, and enhance the dining experience, you risk losing valuable guests, and ultimately, revenue.
In an effort to integrate social responsibility and impact into our business, Olo joined the Pledge 1% movement and created Olo For Good in March 2021. Since then we’ve committed one percent of Olo’s time, product, and equity to foster sustainable contributions to the communities in which we live, work, and serve.
Olo For Good supports organizations that are aligned with our mission and values, including those focused on:
Advancing all aspects of racial, ethnic, and gender diversity, equity, and inclusion
Providing relief for the restaurant industry and its front-line workers
Ending childhood hunger and increasing access to food
Protecting natural resources and reducing waste and emissions
As part of that commitment, we intend to donate one percent of Olo shares over 10 years to an independent donor-advised fund sponsor, Tides Foundation, in conjunction with our Olo For Good initiative. So far, a total of $7 million in grants has been donated to the following organizations:
These nonprofits are focused on diversity, supporting restaurant workers, environmental initiatives, and the fight against hunger. We are committed to working closely with each organization to ensure continued success.
Here are a few examples:
Emma’s Torch is a nonprofit social enterprise that provides paid culinary training to refugees, asylees, and survivors of human trafficking and helps them find meaningful careers in the food industry.
When the pandemic forced Emma’s Torch to halt in-person dining, the organization needed a way to scale its business, including adding pick-up options for guests. And so, in addition to a grant, we donated our time and resources to get them set up with Online Ordering and Dispatch for restaurant delivery, and waived the usage fees.
Since then, Olo has helped Emma’s Torch streamline operations by eliminating manual work, improve order accuracy, and increase its reach throughout New York.
We remain committed to increasing online ordering capabilities for Emma’s Torch, assisting the organization as it expands to new locations, and leveraging each team’s strengths within the culinary industry to build a stronger community.
Giving Kitchen supplies emergency assistance to food service workers through financial aid and a network of low or no-cost community resources.
When a food service worker experiences an injury, illness, housing disaster, or other trauma, they can apply for financial assistance to cover living expenses. Additionally, Giving Kitchen’s Stability Network connects people to resources related to mental health and substance misuse, employment, housing, social services, and more.
Formed out of an overwhelming community response to the terminal cancer diagnosis of Chef Ryan Hidinger, the nonprofit has provided over 6.7 million dollars to food service workers in crisis since 2013.
The pandemic underscored the value of Giving Kitchen, with 2,500 individuals served in 2020 alone, and set its intentions for the future. We’re proud to help the organization in its efforts to increase awareness within the restaurant industry and expand beyond Georgia and Tennessee to serve food service workers in need throughout the United States.
Partnership with Native Americans
Partnership With Native Americans (PWNA) provides consistent material aid, educational support, and community-based services to Native Americans living on remote, isolated, and impoverished reservations.
After an Olo employee nominated the nonprofit, PWNA received a grant to support its first-ever ancestral foods distribution to Tribal communities in the Northern Plains and Southwest regions of the U.S. Alongside PWNA’s Native-led, peer-to-peer ancestral foods training that teaches individuals how to prepare traditional Indigenous meals, this distribution will complement the organization’s food sovereignty efforts.
PWNA will also use a small portion of the grant to purchase and distribute portable solar lights from Watts of Love to Tribal communities that lack sufficient electricity and lighting infrastructure to be safe and productive.
We’re grateful to partner with an organization that is working to eliminate food insecurity and increase safety among the Native American population.
How to Get Involved
Individuals or nonprofit organizations that want to get involved with Olo For Good or explore potential partnership opportunities are encouraged to reach out to [email protected].
Stay tuned for the announcement of our next batch of Olo For Good grant recipients in April 2023.
For more information about how Olo supports nonprofits via Olo For Good, and our ESG work, visit www.olo.com/esg.
Restaurant CDP, Restaurant CRM, Guest Data Platform, Customer Data Platform
To help you make sense of the ever-evolving restaurant tech ecosystem and how it all works together to benefit restaurants, we’re breaking down two of the most talked-about newcomers to the restaurant tech stack: Customer Relationship Management (CRM) and Customer Data Platform (CDP).
At a high level, both of these tools are used to personalize the guest experience with cross-channel communications that are timely, relevant, and tailored to the behaviors of each individual. Though both can add tremendous value to businesses, they function very differently.
What is a CRM?
CRM stands for Customer Relationship Management. A standard CRM system collects data on a company’s direct guest interactions—like contact details and previous conversations—from a variety of communication channels, including their website, email, social media, and more. In other industries, sales teams utilize CRM systems to track and manage customer and prospect contact information, accounts, leads, and sales opportunities in one location.
Given that restaurants see thousands of guests per day, it would be unreasonable to expect operators to collect and store every nuanced guest data point by hand. A restaurant CRM like Olo’s eliminates that issue by connecting data from systems like your POS and online ordering solution as well as other custom-built (restaurant-specific) integrations—and making it actionable.
The action aspect of a CRM is not only critical but also differentiates solution providers. Every CRM has a unique set of actions you can take within the platform leveraging collected guest data—at minimum offering a way to create segments, engage guests via email, and so on. A restaurant CRM is built to take actions unique to engaging a restaurant guest like automating feedback surveys following an online order, incorporating offers into triggered email and SMS campaigns, and more.
In a nutshell, a CRM enables businesses to collect their guest contacts from select sources and organize them. And CRMs often also enable brands to communicate with their guests through integrated channels (e.g. via email)—and track those interactions over time.
What is a CDP?
CDP stands for Customer Data Platform. The Customer Data Platform Institute defines a CDP as: “packaged software that creates a persistent, unified customer database that is accessible to other systems.”
In general, a CDP connects all types and sources of customer data, including transactional, behavioral, profile, product, CRM, and offline, to create a single guest profile. Then, it can send that data to a myriad of destinations to make it usable.
A restaurant CDP like Olo’s Guest Data Platform creates individual guest profiles by connecting data from restaurant-centric systems including POS, loyalty programs, payment processors, reservations, guest feedback, mobile apps, online ordering, WiFi, waitlist, events, and e-commerce. It can then push that data to, again, restaurant-specific destinations like the host stand, menu engineering tools, real estate site selection vendors, a marketing automation solution, media channels, and the list goes on.
This gives every department—from marketing and finance to operations and culinary—a holistic view of guests, so they can sort, analyze, and act on those insights instantly.
The Main Differences Between CRM and CDP
Both Customer Relationship Management (CRM) and Customer Data Platform (CDP) solutions collect guest data for businesses. However, there are a few important differences.
CDPs are designed to ingest massive amounts of data from a large number of sources. CRM data integrations tend to be more limited or require significant customization.
CDPs dedupe guest records automatically, which is vital when the data is being piped in real-time to several external tools. CRMs are built to make use of guest records from directly within the system itself and often include reporting or audience-building filters manually controlled by the CRM admin.
CRMs track known guests, whereas CDPs combine data from known contacts and reduce the number of anonymous profiles by connecting the dots between guest behaviors (e.g. a frequent diner could remain anonymous until their first online transaction—but their profile is zippered together with a unique credit card token)—to create a single source of truth.
CDPs are not designed to take action to the end guest. Outside of data consolidation and identity resolution, CDPs only send data to external tools. CRMs, on the other hand, regularly have action baked in.
Which is Best For Restaurants: CRM or CDP?
There is no one-size-fits-all solution to optimizing a restaurant tech stack. There are numerous factors to consider including, but not limited to, overall business goals, budget, guest experience, operations, marketing, and beyond.
Restaurants can use the Guest Data Maturity Pyramid (Fig. 1) as a guide to determine which technology will best suit their business needs. Most brands start at the base of the pyramid to build the foundation of guest data architecture. At this stage, a brand may simply need data that is accessible and usable, in other words, a CRM.
As brands mature, they start to move up the pyramid. A CDP can help these brands with things like unifying and enriching guest profiles, gathering additional insights, piping data to other business intelligence tools, marrying data to financials, and leveraging lifetime value (LTV) throughout the organization.
It’s important to note that a CRM and CDP are not incompatible—more often than not, they’re interconnected. In fact, the best CRM for restaurants is one that can act as both a source and a destination for actionable data coming in through a CDP. For example, having your CRM and CDP connected would give you the ability to enrich guest data back into the CRM.
How Restaurants Can Benefit From a CRM
Good restaurant GMs and team members store personal details about regulars—favorite dishes, hobbies, family, etc.—in their heads. The problem is: It’s not scalable. They cannot easily share that information with other teams, especially corporate functions like marketing, culinary, or real estate. And to make matters worse, with staff turnover, those crucial guest details can be lost altogether.
A restaurant CRM eliminates those issues by collecting vital guest intel, along with contact information, communication history, and engagement channels, in one location so it’s never lost and can be accessed by others.
Keep in mind that not all restaurant CRMs are created equal. Some are integrated with other tools—like waitlist, reservations, POS, and more—while others are more limited in functionality. Additionally, only some CRMs offer analytical capabilities that enable operators to segment guests or export data. And when it comes to actually acting on that data, some CRMs feature SMS or email marketing automation, while others do not.
Given that no two CRMs are built exactly the same, it’s important to thoroughly vet any solution before adding it to your restaurant tech stack in order to get the best bang for your buck.
How Restaurants Can Benefit From a Customer Data Platform
When restaurant brands are ready to do more with their guest data than a CRM can offer, they graduate to a CDP. A restaurant CDP can fuel the next phase of growth by making data more accessible to everyone, integrated with a wider-reaching set of sources, and actionable across an essentially unlimited number of destinations.
Restaurants often struggle to access their guest data due to archaic systems or limitations set by tech vendors. With a CDP, restaurants gain access to usable data from countless sources—online and offline—merged into a single guest record. Here are just a few of those sources:
Even brands that have access to their guest data typically do not have the team or the technology to stitch it all together. And systems that strictly unify data add another layer of costs. Some of the primary benefits of a restaurant CDP are that it eliminates data deserts, manual workflows, tech-stack dependency, and vendor lock-in.
With a CDP, restaurants can push a singular, enriched guest record to the destination vendor best suited to meet the brand’s business goals, including marketing, business insights tools, or data warehouses. For example, brands can use lifetime guest data to tailor email and SMS marketing efforts, as well as search and social advertising, with conditional messaging that drives guests through the funnel based on their engagement.
Through unifying and enriching guest profiles, a CDP can tell a brand exactly where and why guests spend money. By piping data to business intelligence tools and using the lifetime value (LTV) metric, brands can quantify the results of marketing dollars spent, staff training, menu optimization, real estate selection, etc.—and make strategic business decisions based on the behaviors and preferences of high-value guests.
Still on the Fence?
If you’re still unsure of which solution is right for your restaurant brand, you’re not alone. For some, the data accessibility that a CRM provides is enough to satisfy their business needs. For others, the extra layer of data integration and flexibility that a CDP offers will be key to growth.
The truth is, that a CRM and CDP are not mutually exclusive. Each works with the other to provide a holistic view of the guest.
With a restaurant CDP, specifically designed to integrate with (often antiquated) POS systems, brands finally have the option to move up the Guest Data Maturity Pyramid and maximize lifetime value with enriched, actionable guest data.
In the end, restaurant brands that invest in technology that harnesses data—and act on it—will provide the best guest experience, edge out the competition, and build a profitable future.
Many restaurant brands have found themselves in a predicament when it comes to delivery.
Fifty-four percent of adults now consider purchasing takeout or delivery food essential to the way they live, with delivery accounting for approximately 9% of total U.S. restaurant sales. Furthermore, IMARC Group expects the global online food delivery market to reach $223.7 billion by 2027, exhibiting at a growth rate of 11.44% over the next five years.
And yet, the industry is still down 750,000 jobs—roughly 6% of its workforce—from pre-pandemic levels as of May.
How do you satisfy growing consumer demand for delivery when you’re short-staffed?
Stiff competition for workers and a tight budget may seem insurmountable, but you’d be surprised what even the most resource-strapped brand can achieve with the right tech stack and some strategic planning.
Restaurants of all service models can take steps to streamline operations and reduce stress for staff, all while providing guests with the convenient delivery experience they crave.
Start with these seven tactics:
1. Pare down your delivery menu
Offer a limited or less complex delivery menu using guest feedback and order history as your guide. Identify opportunities to simplify recipes using fewer ingredients and carefully consider how well the food will travel. Regularly test different delivery menu items to ensure guests are getting the best off-premise dining experience possible.
2. Create separate areas for delivery prep and handoff
When a restaurant is short-staffed, the potential for confusion and mistakes goes way up. You can help create a smooth process for staff, delivery couriers, and guests by assigning separate areas for delivery prep and handoff with prominent, straightforward signage.
3. Designate a team member to oversee delivery orders
If your restaurant is receiving 30+ delivery orders per day, name a Delivery Specialist to oversee each part of the order lifecycle: receiving orders, preparing food for handoff, checking for accuracy, passing food from kitchen to courier, and providing communication and support for delivery issues. Alternatively, if the order volume isn’t high enough to demand a full-time role, make it the responsibility of one of your team members to ensure delivery orders are not overlooked at the beginning of their shift.
4. Integrate all online orders with the POS
Consolidate all online orders—direct, third-party, delivery, and pickup—into one dashboard through a single digital commerce engine so that your staff doesn’t have to juggle multiple tablets or manually input transactions into the POS. You’ll spend less time training, improve order accuracy, boost guest satisfaction, and reduce employee stress.
5. Prep what you can beforehand
Think about what can be done during the pre-shift prep period to speed up the delivery process. Have restaurant staff members fill sauce containers, pre-package sides, fold to-go boxes, and other related tasks to boost efficiency and decrease anxiety during peak-volume times.
6. Control delivery order volume with throttling
To control the volume of delivery orders that restaurant locations receive within a particular time frame, brands can take advantage of order throttling strategies. By setting a maximum number of make-time minutes or orders-per-window that can be accepted during a certain time slot, you can ensure that delivery orders get fulfilled in a timely manner and staff aren’t overwhelmed.
7. Leverage an integrated delivery network
Managing a courier fleet in-house can be stressful and expensive. By tapping into an integrated delivery network, restaurants can offer direct delivery without the hassle or commissions. Here’s how it works: Delivery orders placed on your restaurant website or app are automatically paired with third-party couriers so guests get a seamless experience, while you control the order data, guest relationship, and revenue.
To find out how Olo can help launch or strengthen your delivery program, contact us today.
While workplace diversity training first emerged in the mid-1960s, many businesses have recently made diversity, equity, and inclusion (DEI) a priority by rethinking hiring practices and company culture and even enlisting the help of specialists to lead the effort. At Olo, we recognize that meaningful change takes time and dedication.
That’s why our team regularly analyzes company data, surveys employees, and creates policies and resource groups that celebrate our differences, support underrepresented individuals, and foster a community of belonging.
Before we provide specific examples of how we put DEI into action at Olo, let's break down the acronym:
Diversity refers to acknowledging, understanding, and appreciating individual and social differences (age, gender, race, sexual orientation, religion, physical abilities, socioeconomics, etc.). In the workplace, it means giving everyone a seat at the table and celebrating differences.
While equality ensures each person or group receives the same resources or opportunities, equity recognizes that each person has different circumstances and provides the exact resources and opportunities needed to reach an equal outcome. In the workplace, this means ensuring every employee can succeed.
In the words of Vernā Myers, “Diversity is being invited to the party. Inclusion is being asked to dance.” In other words, inclusion is the extent to which each person in an organization feels welcomed, respected, supported, and valued as a team member. This type of environment requires people from diverse backgrounds to communicate and work together, and to understand one another's needs and perspectives.
Olo’s Journey To Becoming a DEI-Focused Organization
Olo has made DEI a core component of our business. To foster a culture of inclusivity, we believe it’s important to look inward, listen, and take concrete action. We started with these three steps:
To become a DEI-focused organization, Olo’s leadership first made the commitment. Our team recognized that only if leadership set the tone and clearly communicated expectations and goals, could the rest of the company engage and help see it through.
Next, we needed to evaluate the current state of DEI at Olo, from a qualitative and quantitative perspective. To establish a baseline for measuring progress and to identify areas of improvement, we had to do a bit of self-reflection.
For one, we had to find out how employees viewed the company. Do they feel like they belong? Do they feel like there’s a safe place for conversation between teammates and leaders? Understanding the core data (e.g. the breakdown of men and women, race, and ethnicities at the company) was key.
Finally, we had to be willing and able to take action. Reporting data and taking the pulse of employees is great, but unless we were prepared to take concrete steps to address areas of improvement, the rest wouldn’t really matter.
How Olo Puts DEI Into Action
The work began with the creation of our Diversity Statement and the enhancement of our recruiting efforts. We created a dedicated DEI function within the People + Culture team, expanded our Talent Acquisition team to actively source diverse candidates, implemented ongoing DEI training for all employees, helped launch Employee Resource Groups, and more.
By the end of 2024, Olo aims to have a team composed of at least 42% women and 18% underrepresented ethnicities (employees who voluntarily self-identify as Black/African American, Hispanic/Latinx, Two or More Races, Native American, Alaskan Native, Native Hawaiian, or Pacific Islander). And thereafter, we hope to set additional targets to continue our efforts.
Here are some of the ways we’re moving toward our goal:
Annual DEI Survey
We have an annual DEI survey that asks employees questions like, “Do you feel like you belong?” and “Do you feel like your voice matters?”, in addition to capturing demographic information like age, ethnicity, department, and gender identity. By analyzing the responses, we can compare the experience of different groups and develop a plan to address areas in need of improvement.
Composed of a group of diverse employees from across the company, the DEI Committee’s role is to raise a voice for all Oloites, advise the Diversity, Equity, and Inclusion Director, and create and facilitate events and initiatives to increase DEI at Olo.
To increase representation across the company, we’ve taken a number of steps, including:
Pre-screening all job descriptions to ensure we’re using inclusive language
Posting on diversity job boards
Proactively sourcing diverse candidates
Including our diversity statement in our job descriptions
Anonymizing profiles when reviewing assessments
Removing college degree requirements where possible
Training hiring managers on interview strategies to reduce bias
Forming a diversity hiring committee to evaluate every step of the process and identify areas for improvement
We’ve also expanded our recruitment efforts at diversity-focused events, such as the National Society of Black Engineers and the Grace Hopper Celebration of Women in Computing, to hire more junior engineers and interns.
We have a robust training curriculum that includes guest speakers, panel discussions, and leading inclusively training specifically targeting managers and leaders.
We launched Olo Ties, a mentoring pilot program that gives women and underrepresented minorities at Olo an opportunity to work with mentors at the company and get help in their career paths.
Employee Resource Groups
We encourage employees to create Employee Resource Groups (ERGs) and provide support when they want to bring in guest speakers and hold events. We currently have six: Olo Women’s Network, Oloites of Color, Olo Pride, Olo Green, Vets @ Olo, and Olo Parents.
Job Leveling and Compensation Calibration
We regularly review our job leveling—the systematic method of objectively and actively assigning value to positions—and compensation across the company to ensure that we’re being equitable and consistent across all departments and positions.
Every month we look at our statistics across gender, ethnicity, and racial demographics across the company and track our progress with consideration to hiring, acquisitions, and attrition.
Publishing DEI Data
Many businesses are hesitant to publish DEI data because the numbers aren’t ideal. To help hold ourselves accountable for improving our stats, we publish our DEI data on our website.
Allies play an important role in building an inclusive workplace by recognizing their own privilege and using their skills, knowledge, and position to drive real change.
At Olo, we encourage individuals who want to show support for underrepresented groups to demonstrate their allyship by listening, being receptive to feedback, having a willingness to change behavior to be respectful and inclusive, challenging inequities and attempts to marginalize individuals, as well as letting them know that they care and stand by them.
Companies don’t become DEI-focused organizations overnight. But, everyone wins when leadership makes a public commitment to positive change and actively works to build a culture that promotes growth and equity for underrepresented groups. The key is empowering employees to take action and help move the company forward.
Restaurant Marketing, Restaurant Guest Segments, Email Marketing, Social Media Marketing
People increasingly want to hear from their favorite brands, but blasting the same email to every guest—with no regard for their unique preferences, behavior patterns, or level of engagement—can be a costly mistake.
With restaurant guest segmentation, you can tackle a myriad of strategic objectives: win new guests, see them more often, boost online ordering, keep regulars engaged, and more.
5 Restaurant Guest Segments to Set Up Today
The best way to jumpstart a restaurant marketing plan is to build these five guest segments, which will enable you to personalize omnichannel communications and maximize lifetime value (LTV).
1. High-Value Guests
Segmenting by high check average is a foundational step toward targeted restaurant marketing. A good baseline is the top 10% of spenders. Why? Guests who spent a lot at your restaurant once are likely to have a high check average again, and therefore should make up a larger portion of where you invest your marketing dollars.
2. Loyal Fans
If a high-value segment is foundational, a segment of guests that is highly engaged is the second layer in that foundation. A loyal guest with a slightly lower check average may prove to have a higher lifetime value in the end (e.g. they spend less but they visit frequently). Plus, they’re more likely to be brand loyal if marketing communications speak to their personal preferences. This segment is made up of guests who come in regularly, order online often, and open most of your emails.
3. Churn Risks
It is proven to be more expensive to acquire new guests than it is to retain existing ones, so it’s worth putting time and resources into retaining lapsed visitors. When creating this segment, consider setting up filters to capture restaurant guests who used to visit or order regularly, but haven't in the past 6+ months (depending on your guest frequency averages).
4. Online Orderers
Restaurant delivery and curbside pickup are essential and will continue to grow in the future. A segment of online orderers allows brands to suggest high-value takeout items to interested diners, but also market in-restaurant experiences to increase on-premise sales.
5. Daypart Devotees
There are many ways to slice, dice, and cook up strategies to leverage daypart segments. One approach worth testing is using a segment of current daypart devotees to target lookalikes—meaning guests who mirror those already visiting regularly during your slower shifts. Want to drive business on Monday or Tuesday night? Targeting lookalikes of guests who have proven to be weeknight warriors in the past is a great place to start a paid search or social effort.
Restaurant Marketing Ideas
Restaurant guest segmentation is only the beginning. The real fun (for marketers at least) starts when those segments are put to work through personalized communications geared toward each segment’s preferences and purchase behavior. Here are a few examples of restaurant marketing campaigns that leverage segments:
Goal: Boost Online Order Frequency with a Triggered “Inside Scoop” Email Campaign
Segment: Guests who have ordered online, but haven’t ordered within the last month
Trigger: It has been 30 days since their last online order
Campaign: Personalized email campaign promoting special takeout-only menu offerings. “Hey, Naomi! We want to let you in on a sweet secret. *Whispers* Did you know we have a s’mores kit that is only available to-go?”
Win New Guests | Social Media Marketing for Restaurants
Goal: Attract Guests to a New Location by Targeting Lookalikes with a Lead Magnet
Segments: Top 1% most frequent visitors and/or top 10% most valuable guests
Lead Magnet: $20 toward your first meal (with a qualifying minimum spend)
Campaign: A social media campaign promoting your grand opening and the first week of specials targeted to lookalikes of your current regulars who live nearby your new location. For added effectiveness, require people to first share their email to access the $20 gift card (aka “email gate”) and grow your marketable guest database.
Boost Brunch Business | Multi-Channel Restaurant Marketing Plan
Goal: Drive Brunch Sales with a Multi-Channel Campaign Promoting New Menu Offerings
Segment: Saturday and Sunday Regulars who visit between 9 a.m. and 1 p.m.
Campaign: Send a personalized email campaign promoting your brunch cocktail menu on Tuesday, then launch a re-targeted social media campaign to the same segment featuring your signature cinnamon roll on Friday to keep brunch top-of-mind as guests head into the weekend.
Segments are just the beginning of a personalized restaurant marketing strategy—once built, you can start to track their growth, frequency, and check average. For more inspiration, check out 6 Guest Retention Strategies that Actually Work.
Technology is key to efficient restaurant management and a positive dining experience for guests in this digital age. The right tech stack will reduce manual work and stress for employees, decrease human errors and miscommunication, boost guest satisfaction, and ultimately, enable the brand to serve more people.
As the industry juggles a labor shortage and a resurgence in dine-in, many brands are looking for ways to do more with less. But with a rapidly growing restaurant tech ecosystem, it can be difficult to tell the difference between nice-to-have and must-have solutions.
Knowing that every brand has unique needs, we’ve narrowed down the list to the most impactful tech solutions for boosting front-of-house efficiency.
6 Restaurant Technologies That Streamline FOH Operations
1. Online Order Management System
With online orders streaming in from multiple sources, brands need a way to effortlessly manage orders and handoff without leaving the counter. A tablet-based online order management solution can enhance the front-of-house workflow by enabling team members to manage all orders (direct and marketplace), view by handoff mode (inside, drive-thru, curbside), early fire if needed, set custom labels and alerts for large orders, request new drivers, receive curbside arrival notifications, and set menu item availability—all from a single screen.
2. Table Management System
A modern restaurant table management system provides real-time, streamlined party management so that full-service operators can efficiently manage dine-in parties, off-premise orders, reservations, and waitlist parties from a single list. That means more guest-facing interaction, far less training, and no more bouncing between apps that don’t share data.
With the right system in place, restaurant brands can optimize operations as service unfolds via automated table status updates through a POS integration and customizable configurations like push notifications, smart tags, and more.
3. QR Code Ordering
Restaurants can leverage QR code ordering to optimize operations and create a seamless dining experience by enabling guests to view the menu, order, and pay at the table, all from their phones. Guests simply scan a QR code on a sign or sticker at the table and order, without needing to wait for a server or stand in line
Increased staff efficiency resulting from fewer nonessential touch points between employees and guests, and faster table turnover are just a few of the benefits of QR code ordering.
Read our Nando’s case study to find out how QR code ordering has transformed on-premise operations and the dine-in experience at the fast-casual restaurant brand.
4. Reservation System
Reservation systems help full-service restaurant brands strategically map out their dining rooms in order to serve more guests as well as provide more accurate wait quotes. Reservations give operators the ability to prepare the kitchen and waitstaff ahead of a busy shift, and less wait time means happier guests.
With the right restaurant reservation system, guests can book a table directly with the restaurant via Google, social media, website, app, etc. for a seamless user journey.
5. Waitlist Management System
Forget pen and paper. A waitlist management system can enable full-service restaurant guests to join remotely and offer automated, real-time updates so they know exactly where they are in line.
With fewer people crowding the entryway and less time spent manually texting guests, hosts can focus their attention on thoughtfully greeting and seating. And, when everyone is in the know, brands can expect fewer unnecessary phone calls, texts, and host interruptions, which can lead to happier employees and guests.
A modern restaurant waitlist system can also accurately predict wait times using sophisticated algorithms, so the host staff doesn’t have to guess and risk upsetting guests.
Hot Tip: Even at times when there is no wait, operators can turn on a 0-5 minute waitlist to capture guest data that would otherwise be lost with an unidentified walk-in.
6. Scheduling Software
Staffing challenges are a major headache for brands and can negatively impact operational efficiency, quality of service, guest satisfaction, and team member retention. To combat these issues, some restaurant operators leverage restaurant scheduling software to quickly organize shift schedules, anticipate scheduling challenges, and communicate with team members about last-minute shift changes.
A Virtual Helping Hand
Restaurant brands should consider technology a virtual helping hand that makes it possible to do more with less. By automating tedious tasks and empowering team members to focus on making meaningful connections with guests, everyone wins.
For more inspiration, read How tech can ease the FOH labor shortage. And stay tuned for the next installment of our “Do More With Less” series, wherein we’ll cover restaurant delivery strategies and solutions.
To find out how Olo can help your restaurant brand do more with less, contact us.
Every day, restaurant CFOs field numerous requests to spend more money. If they approve the wrong expenses, the brand ends up in a ditch. Spending too much on labor or spending too little. Spending too much on food costs or too little. The same is true in every department.
To make matters worse, what you should spend varies from brand to brand—and location to location. Some guests will pay up for better food ingredients, others won't. Some guests will pay for a location that offers a unique dining experience, others won't. These decisions are all shades of gray, and they're endless.
Certain Costs and Uncertain Benefits
The reality is that every restaurant CFO is forced to predict what their guests are willing to pay for, and to what extent. Over the years, tools have emerged to help CFOs understand what's working and what's not, including:
Each is insufficient.
Online Reviews: Do the opinions of these people represent our guests in general?
Secret Shops: Even if we deliver our brand standard to one party, does it resonate with all guests?
Traffic Counts: Are we churning through guests, or are we doing a good job retaining them?
To this day, CFOs are faced with certain costs and uncertain benefits—the balancing of guest experience and cost. When faced with enough of these decisions, most people will start indexing toward reducing cost—it's the logical thing to do.
In his book “Restaurant Man,” Joe Bastianich shared that his secret to success in restaurants was "watching costs while focusing relentlessly on exceeding customer expectations." Restaurant margins are often tight; there's no room for error.
Like other complex ecosystems, it's difficult to quantify the effect of forces interacting with each other. (Aside: For an interesting read on ecosystems, I'd recommend “Serengeti Rules,” written by evolutionary biologist Sean B. Carroll.)
The net of all this: CFOs and the brands they lead sink or swim based on the strength of their judgment (and their luck).
It doesn't have to be that way.
Why Lifetime Value is a Critical Guest Health Metric
In other industries, especially retail e-commerce, brands optimize everything around Lifetime Value (LTV). LTV is the predicted cash flow from a guest, based on their recency, frequency, and monetary spend. You can think of it as a guest-level Discounted Cashflow Analysis.
Professor Peter Fader of The Wharton School at The University of Pennsylvania pioneered the LTV field 20 years ago, and it has since gained traction across industries. In 2016, Fader founded a company called Zodiac, which calculated customer lifetime value and was later acquired by Nike. Recently, Fader founded another company called Theta, which calculates company valuations based on guest data. Fader's and Theta Equity's work is used in tech, e-commerce, and hedge funds to help leaders fine-tune day-to-day operations.
The LTV science applies as much to restaurants as any other business. Legacy POS systems, tech vendors that "own" the guest data, and fragmented SaaS systems are the root problem. It's impossible to know the value of each individual guest when the data resides in disconnected silos.
In three years, harnessing the power of guest data will be table stakes. Today it differentiates—the Roark portfolio, Panera, and just a few others do it well.
Retail e-commerce nailed it. Restaurants can take lessons on six fronts: Strategy, Marketing, Operations, Menu, Labor, and Real-Estate.
How Restaurants Can Use Lifetime Value
According to Olo data from more than 18 million guest records, the top 5% of restaurant guests (by LTV) drive about 30% of revenue, and the top 20% of guests drive 60% of revenue. This is a law for every restaurant business. The entire executive team should understand:
Who those top guests are (psychographics and behavior most importantly)
Why they visit (purchase patterns, daypart patterns)
Why they stop visiting (NPS, feedback)
How we find them (acquisition channel)
Based on a strong foundation of understanding of the guest, now marketing can drive guest counts. In the future, marketing will be increasingly precise and measurable. Top guests spend 6x the average and 25x the bottom. On the side of acquisition, marketing can seek out those guests and justify paying a higher price to acquire each of them.
I don't know of a single CFO who would complain about spending $20 to acquire a guest who spends $750/yr as opposed to $5 to acquire a guest who spends $50/yr. Knowing the guest teaches you where to fish. Historically, the challenge has been tracking a single guest across visits.
From a frequency perspective, marketing teams can now nudge guests in exactly the right way at exactly the right time. If frequency dips, or it's been a while since they've visited, or they give you poor feedback, send an automated message (or series of messages) to the guest on the channels where you can reach them. The work here is testing and improving those messages—not sending or measuring campaigns.
Growing up working in restaurants, the CRM was in my brain. I had an anecdotal inventory in mind of who the valuable guests were. I knew their names, what they liked to drink, and their hobbies. I really cared.
But guest relationships can’t be entirely dependent on individual employees. Otherwise, every time you hire someone new, they have to rebuild that CRM from the ground up. It puts employees in an unfair position and alienates regulars. No regular loves the "have you dined here before?" question.
To ensure that guests keep coming back, even when staff turnover occurs, brands need an institutional memory rooted in data. Today's restaurant systems ensure that all employees know the regulars—whether they're in the building or ordering online. But we shouldn't stop at regulars. What about people who had a bad experience last time, haven't been back in a while or might like a new item on the menu?
It may seem like magic, but all this information can be displayed in the host stand system and pushed into the POS in real time.
If a server (full-service) or cashier (limited-service) gets guests to return more than the average employee, they should get rewarded. In full-service, that means better sections, and in all service types, that means better schedules. That part is obvious, yet mostly subjective.
The simple metric to provide managers is an employee’s Repeat Customer Rate: the number of guests who come back for another visit divided by the total number of guests they see. Managers should know an employee's Repeat Customer Rate within the first 90 days of hiring a new front-line employee.
What if you indexed your hourly pay to Repeat Customer Rate? Employees who drive high repeats should get paid more per hour. Repeat Customer Rate is a simple, transparent, fact-based metric to align employee incentives with those of guests and shareholders.
As a thought experiment, how much would you pay a server if they got every guest to visit again?
If you're not making menu decisions based on reorder rates, you're doing your guests a disservice. Let's explore a few theoretical menu items:
High volume, high repeat = All-stars, put these everywhere in your acquisition campaigns.
High volume, low repeat = Guests want to love this item, but they don't. These are the worst items of all because they turn off droves of new guests. Test new recipes here, fast!
Low volume, high repeat = It may seem like a bummer of an item, but your regulars are the ones who buy it. These kill you when you take them off the menu.
Low volume, low repeat = Not worth the space on the menu, and not the complexity to carry the food costs. Kill these items.
Every restaurant brand wants to pick locations near where their guests live, work, and play. In order to do that, you need to know exactly who your guests are and their respective lifetime values.
Brands can identify sites with high ROI potential by leveraging restaurant technology and analytics firms that provide actionable insights rooted in data, including mobility, demographic, LTV, purchase history, preferred sales channel, etc.
Give your real-estate team a spreadsheet with this intel so they can ensure your newest locations are set up for success.
How to Get the Restaurant CFO On Board With LTV
Today, you'll be uniquely good if you embed lifetime value into your company. In three years, you'll be uniquely bad if you haven't. LTV is the most critical guest health metric.
For non-finance types, if you're wondering how to convince your CFO to spend more money—prove to them that your project will drive LTV through:
Acquiring enough new target guests
Maximizing the "lifetime" of each guest
Maximizing the transactions guests make over their lifetime
Maximizing the margin per transaction
To find out how to unlock LTV and leverage those insights across your entire business, contact us.
Silicon Valley began funding delivery-only startups in 2016, but it wasn’t until 2019 that virtual restaurants started making waves. With the advent of COVID, the trend has taken off with some of the largest concepts, like MrBeast Burger, generating $100M in revenue across 1,600 virtual kitchens in roughly 15 months.
With that level of success, it’s no wonder restaurant brands of all types are seriously thinking about launching one of their own. But there’s a lot to consider—from unique offerings and packaging to competition, location, and marketing.
To help you determine if a virtual restaurant is right for your business, we’ve compiled a guide of opportunities, challenges, and best practices based on our experience launching over 75 virtual restaurant brands.
What is a Virtual Restaurant?
A virtual restaurant is a delivery-only concept with a full menu that exists solely online and is often listed on third-party marketplaces, with no traditional, brick-and-mortar restaurant space.
Virtual restaurant brands can operate out of an established restaurant or a ghost kitchen. While the terms are often used interchangeably, a ghost kitchen (aka a dark/cloud kitchen) is a shared commissary space without a dining room that one or more virtual restaurants can rent to prepare off-premise meals.
Guests can place an order for delivery via a virtual brand’s website or a third-party marketplace.
While virtual restaurants have proven to be a worthy venture for some brands, there’s plenty to consider before diving in. Here are just a few of the potential opportunities and challenges of launching a virtual brand.
Minimal Overhead: Without a dining room and front-of-house staff, there are fewer ongoing expenses, such as utilities, equipment, salaries, etc.
Additional Revenue: Virtual brands can be a valuable source of incremental revenue for established brands with underutilized kitchen space.
Flexibility to Test: Brands can iterate on menu favorites or repurpose ingredients to create new dishes.
Less Food Waste: By leveraging delivery data to make food preparation decisions, as well as splitting and reusing ingredients within a shared kitchen space, virtual brands can minimize food waste and help the environment.
Reach New Guests: Established businesses can breathe new life into their brand—or reinvent themselves altogether—to reach new demographics.
Quick to Set Up: Without a brick-and-mortar location or a large staff, standing up a virtual brand can be far less intensive than a traditional restaurant.
Room to Expand: If successful, a virtual concept could seamlessly transition into a traditional restaurant or even be absorbed by a parent brand, just as Wingstop incorporated Thighstop into its permanent menu.
High Partner Commissions: To drive sales, many virtual brands are reliant on third-party marketplaces, which can charge commission fees as high as 30%.
Harder to Form Relationships with Guests: Building trust and long-term loyalty can be difficult for virtual brands that have fewer ways to interface with guests.
Brand Building: Virtual concepts that don’t have an established parent brand have to build everything—from an audience to branding and marketing—from scratch.
Quality Control: Quality can suffer if kitchen staff have to juggle orders from multiple concepts. And if third-party providers are entirely responsible for delivery, brands have less control over order accuracy and customer service.
Reputation Management: Reviews can make or break any restaurant’s reputation, but virtual brands are especially vulnerable since they operate entirely online.
Inaccessible Data: Unless virtual brands take orders directly through their website, guest data can be difficult to access and leverage when owned by third-party marketplaces.
Staff Burnout: Brands run the risk of overwhelming staff if they’re unable to effectively manage the flow of orders from a virtual concept and their typical restaurant operations.
Virtual Brand Best Practices
In the process of helping dozens of virtual restaurant brands get off the ground, we learned a thing or two about how to set a concept up for success. Keep these tips in mind for a strong debut and sustainable growth over time.
Well-Researched Business Plan: You wouldn’t open a brick-and-mortar restaurant without a solid business plan—a virtual concept should be no different. Thorough market research, competitive analysis, budgeting, a comprehensive marketing plan, business structure, and financial projections are critical.
Small, Focused Menu: Winning virtual brands have unique but simple menus. They’re straightforward, optimized for quick conversion, and accompanied by mouthwatering imagery.
Professional Branding: Every guest touchpoint—from your website to packaging, and marketing—should be uniquely branded to help generate awareness, provide a consistent guest experience, and establish trust.
Direct Ordering: Marketplaces can be a powerful tool for driving first-time orders, but to build an actionable database and deepen guest relationships, a direct ordering restaurant website and/or app is critical. That’s why Virtual Dining Concepts leveraged marketplaces to garner interest in MrBeast Burger alongside social media and giveaways encouraging people to download its branded ordering app.
Know Your Audience to Grow Your Audience: While some brands, like Wingstop, have successfully tapped into an existing fanbase to find an audience for their virtual concept, others have teamed up with celebrities to generate buzz. Mariah’s Cookies, for example, targeted Mariah Carey’s 10 million-plus followers on Instagram to build awareness across 30 major U.S. markets. Ultimately, brands should play to their strengths and pursue strategies that appeal to their target market.
Multiple Delivery Service Providers: Since virtual restaurants need fast and reliable delivery to be successful, brands should consider enabling multiple delivery service providers.
Retention Campaigns: To keep guests coming back and ensure they become more valuable over time, virtual brands need to prioritize retention campaigns (e.g. direct online orderers to download your restaurant app for quicker service; encourage email subscribers to sign up for SMS messaging for insider perks; give weekend regulars a reason to order during the week, etc.)
Engage With Reviews:Restaurant reputation management is paramount for virtual restaurants. Brands can make guests feel heard and appreciated by responding to online reviews—good and bad—promptly.
Test and Adapt: Successful virtual brands continuously refine their strategy based on what’s working and what isn’t according to guest data and feedback.
What’s Next for Virtual Restaurants?
It’s estimated that virtual restaurant brands will become a $1 trillion industry by 2030, but it’s important to remember that the trend is still in its infancy. Many virtual brands are actively trying to figure out their niche and the key to earning repeat business.
According to research from Datassential, the future of virtual brands is mainly dependent on consumer education and transparency. While the research firm estimates that more than 13,000 virtual brands are operating in the U.S., it found that half of restaurant-goers had virtual brand awareness and just 34 percent have ordered from one.
To establish trust with consumers and gain a loyal following, virtual brands must prioritize quality, consistency, transparency, and exceptional service. By following the best practices above and teaming up with a knowledgeable tech partner, virtual restaurants can be a lucrative venture for traditional brands and startups alike.
To satisfy demand for off-premise dining, restaurant brands of all sizes have embraced delivery. But in order to effectively grow a delivery channel, you need a multipronged approach centered around optimization, education, and promotion that will appeal to existing and potential guests, as well as encourage repeat orders.
Here are eight ways to increase restaurant delivery sales through your brand website and app, as well as marketplaces and listings:
1. Website and App Optimization
The first step to increasing delivery sales is to optimize your restaurant website and mobile app for conversion. In addition to being mobile-friendly, and quick to load, there should be a prominent “Order Delivery” button that’s easy for guests to find.
The fewer hoops guests have to jump through, the more likely they are to place a delivery order. So, be mindful of potential barriers to conversion, such as lengthy forms, limited payment options, account creation prompts, fees added at checkout, etc.
2. Leverage Delivery Service Providers and Marketplaces
Brands can bypass the complications of managing drivers or contracts with multiple delivery service providers (DSPs) by leveraging an integrated delivery network. Using third-party delivery couriers to fulfill native orders from your website or app can increase guest loyalty while offering a direct digital experience wherein you own the data.
Additionally, through a single integration to multiple third-party marketplaces, brands can consolidate all online orders into one location (e.g. POS system, tablet, etc.), regardless of where they originated. This benefits everyone involved in the delivery process: guests receive accurate information, delivery couriers can execute more deliveries per hour, and restaurants stay in control.
3. Order With Google
Brands can turn Google Search and Google Maps inquiries into delivery orders with Order With Google. By accepting delivery orders directly through Google, restaurants can boost their ranking in search results, stand out from the competition, and reduce the number of steps to conversion.
Since new and existing guests likely already use Google every day, restaurant brands can (and should) meet guests where they are and drive delivery orders at the same time.
4. Menu Engineering
Restaurant brands should use menu item profitability, popularity, and lifetime value (LTV) data when designing their delivery menu. Through strategic placement of menu items and upselling, brands can positively influence guest behavior and, ultimately, increase sales.
A restaurant CDP is key to effective menu engineering because it enables brands to connect guest data from their POS, payment processor, online ordering platform, loyalty program, and more to a menu engineering tool. And, by unlocking LTV, brands can quantify the results of menu optimization.
Keep in mind that menu engineering is an iterative process. Regular testing and analyzing trends are key to continuously driving results.
According to Google Trends data from the last five years, the search term “restaurants near me” reached peak popularity in July 2021. To ensure that your brand ranks high in search results when people are looking for food nearby, prioritize SEO across all platforms.
For example, a Mexican restaurant brand that wants to increase delivery awareness and sales should incorporate relevant keywords such as “Mexican food delivery [name of city]” and “Mexican restaurant delivery near me” into its website, social media pages, digital ads, and third-party listings.
6. Omnichannel Marketing
In-store and online restaurant marketing is critical for educating guests about delivery options and encouraging adoption. Each location should display prominent signage and a clearly marked pickup area for delivery couriers. Additionally, staff T-shirts, door decals, receipts (“Next time, order delivery at [URL]!”), bag stuffers and stickers can help spread the word.
With countless meal decisions being made online every second, restaurant brands should leverage email, SMS, social media, and geo-targeted digital advertising to reach a wider audience and boost delivery sales. Focus on the benefits of delivery (convenience, speed, ease of ordering, etc.), enable anyone to start an order with one click, and consider incentivizing guests with an introductory offer, such as free delivery or $5 off $20 on their first order.
7. Solicit and Engage with Feedback
In order to scale delivery, brands have to know what’s working and what isn’t. The best way to find out is to solicit guest feedback about the delivery experience proactively.
With automated surveys, brands are able to show guests that their opinion matters, quickly address issues, spot trends that could impact future sales, and optimize the experience for both first-time delivery orderers and repeat guests.
Monitoring and engaging with restaurant reviews is also important. If guests are complaining about the delivery experience on Google and the brand has not responded in a timely and professional manner, those reviews will negatively affect the brand’s reputation and likely dissuade first-time guests from placing an order.
8. Retention Campaigns
After a guest has ordered delivery once, it’s up to the brand to convince them to do it again. And considering that traditionally, the cost of acquiring a new guest is 5 to 25 times more expensive than retaining an existing one, retention campaigns should play a big role in any delivery growth strategy.
Restaurant brands can motivate guests to order delivery again with personalized offers based on their order history, by promoting new menu items that complement their favorites, or by letting them know about the latest specials just before they make plans to eat. For more inspiration, check out these restaurant retention strategies.
It’s All About the Guest Experience
The most profitable restaurant delivery programs meet guests where they are and offer a frictionless, personalized experience—while also seamlessly integrating with the brand’s existing tech stack.
Omnichannel marketing that educates guests about the benefits of delivery is essential for a successful launch, but the work doesn’t end there. To successfully scale delivery, brands need to continuously market the program to new and existing guests, analyze data, gather feedback, optimize, and test.
Learn about our restaurant delivery solutions, Dispatch and Rails, and ask us how we can help boost sales for your brand.
Faced with a labor shortage and budget constraints, many restaurant brands are looking for a quick marketing solution that’s going to drive ROI. But in reality, what works for one brand may not work for another. Why?
Your guests and their relationship with your brand are unique
The most effective marketing campaigns are rooted in data
As tempting as it might be to test out every marketing channel and tactic at once to see what works, don’t try to boil the ocean. It’s the quickest way to overwhelm any team and, frankly, waste your time and resources.
Instead, consider narrowing your focus to one marketing objective.
Yep, you read that right—one.
Here are a few examples:
Move guests from one visit to five visits
Ensure every guest tries your most popular menu item within 90 days of their first transaction
Drive restaurant app downloads
Build up your SMS subscriber audience
Motivate online orderers to try delivery
Incentivize guests that typically use marketplaces to order direct
Now you’re probably thinking, how do I pick just one objective when we have countless initiatives?
Start by getting your data in order.
Determine what restaurant data sources you currently have access to, including email opt-ins, online orders, POS transactions, loyalty members, CRM, etc.
Next, it’s time to analyze. As you look at the data, ask yourself questions like, who are your guests? How do they behave? What is your average guest frequency? What is your most lucrative sales channel? Can you segment guests by lifetime value (LTV)?
By focusing on even one of these insights, you can figure out which marketing channel (search engine, social media, email, SMS, etc.) and strategy have the highest ROI potential for your brand. For instance, is your restaurant app more effective than social media for guest engagement?
If you can’t answer these types of questions because of a limited data set, a good marketing objective would be to connect more of your restaurant systems so that you have a holistic view of each guest. Cross-department collaboration will be key, so make sure your Marketing, IT, and Finance teams are looped in.
Remember, it’s impossible to create a marketable database and treat every guest like a regular if you have disparate systems and no shared understanding of who your guests are or how they behave.
Once you’ve picked a channel and settled on a plan of action, start executing marketing campaigns. Here’s some inspiration depending on your objective:
Drive foot traffic to a slow daypart: Launch geotargeted Google Ads during those hours of the day, bidding on relevant keywords (e.g. Smoothies near me) and featuring an attractive offer.
Target cart abandoners with remarketing: Invite cart abandoners back to your website to complete their online order with personalized remarketing ads that follow them as they surf the web.
Gather guest feedback at scale: Collect valuable feedback to power your business decisions via automated post-visit surveys. Add a tasty incentive—like free chips and queso on their next visit—for good measure.
Grow your social media following: Launch an email campaign featuring your most popular dishes on social media with an invitation to follow along. Drive engagement by encouraging guests to use a branded hashtag on their posts for a chance to be featured on your feed.
After you’ve gained some experience and insight into what works (and what doesn’t) for your brand, you can graduate within each channel. Think of it as building blocks and treat each marketing bucket as a progressive opportunity.
For instance, if your goal is to increase the number of direct online orders by driving traffic to your website, you could start by launching Google Search Ads targeting people looking for similar cuisine within 10 miles of your restaurant. Once you’ve honed in on the messaging most likely to convert window shoppers into paying guests, set up website retargeting to ensure your brand stays top of mind and invite visitors back.
Whatever your chosen marketing objective, make sure to share your plan—including what you’re testing and why—with your franchisees so that they’re aware and can provide support.
Ultimately, restaurant brands that take a data-driven, hyper-focused approach to marketing will see the highest ROI, not just in terms of sales, but also in terms of guest acquisition and retention. So the next time you’re tempted to do it all, think quality over quantity.
Restaurants typically have a handful of loyal regulars who GMs and bartenders know by name, but behind the scenes, restaurant marketers are on a never-ending treasure hunt to find and attract new guests. While there are numerous restaurant guest acquisition strategies that marketers can leverage, it’s important not to underestimate the value of current guests. After all, research tells us that increasing guest retention rates by 5% increases profits by at least 25%.
Since retention is critical at all stages of the restaurant guest lifecycle, we’re breaking down some proven strategies, with frameworks you can actually use.
6 Winning Restaurant Guest Retention Strategies
1. Use Data for Good (Especially When It Comes to Your Regulars)
Personalization is no longer just a nice-to-have. Guests are beginning to understand the power of their data, and increasingly want brands to use it to serve their interests via personalized offers, experiences, and suggested products. Tailoring what you sell to a guest’s purchase history, preferences, and what they have engaged with is a crucial strategy to build restaurant brand loyalty.
Framework You Can Use
If you’re not already looking to retail for inspiration, start now, paying close attention to personalized marketing. When a guest on the waitlist leaves before being seated, treat it like an abandoned cart and send a strategic email to prompt them to return (stats suggest a 48% open rate for emails like these). Make like retail giants and bundle items—when a guest orders tacos, trigger a campaign suggesting the tacos are frequently enjoyed with an agua fresca and salsa trio. Best use case: A/B test different bundles to see what drives higher check averages and visit frequency.
2. Like Rome, Guest Relationships Aren’t Built in a Day
When it comes to those guests you’re just getting to know, winning second and third visits is a leading indicator of a “guest for life.” The means to that end is a structured cadence of personalized outreach—said differently, giving new guests more chances to engage increases your opportunity to build brand loyalty. And, consumer research shows that personalization increases visitor engagement by 55%.
Framework You Can Use
Build a scalable, repeatable framework for your new guests with a variety of ways to engage as they move through the lifecycle. Pay attention to what works, and tweak accordingly. Try this cadence:
First Visit/ WiFi Signup/ Online Order >> Welcome email promoting your insiders' club (the more tailored you can make this to their experience the better, e.g. drilling down by location visited or the channel via which they first made contact)
After Second Visit >> Let them know you’re listening with a triggered survey: “Hey Caleb, how’d we do? Would you recommend us to a friend?”
After 30 days >> Email campaign featuring occasion-based messaging such as “Did someone say Happy Hour? Right this way…”
After 3 months >> Email campaign featuring your most popular dishes on social media with an invitation to follow along and share: “Tag your posts for a chance to be featured on our feed.”
After 6 months >> Seasonal menu reset with an invitation to get involved: “Be one of the first to taste the new dishes on our menu at a special event for loyal fans …”
After 1 year >> Anniversary perk “Have this cake … on us. And yes, please eat it too!”
3. Go with the Flow (of Guest Frequency)
The Gartner Group found that the Pareto principle holds true with consumer behavior: 80% of your future profits will come from just 20% of your current guests. It’s worth putting time, effort, and resources into guest retention, but not equally for all guests. The key here is segmenting by value and analyzing each segment’s frequency. With that, you can allocate time and resources according to value, and build outreach aimed to increase their known frequency.
Framework You Can Use
Guests with a high check average may be occasion-based guests with a twice-per-year frequency for birthdays and anniversaries. Send them a personal invite to join for a New Year’s Eve toast or Mother’s Day brunch to increase their frequency to quarterly.
Meanwhile, a segment of high-value guests may have a lower check average and bi-monthly frequency. Aim to get them coming in once a month by sending them an easy-to-use offer that appeals to convenience.
4. Go Outside the Inbox
To reach guests who have stopped engaging with your brand, try a structured cadence across multiple platforms. Research shows that companies using multiple channels to connect with guests increase satisfaction by 15-20% and boost growth by 20%.
Framework You Can Use
Build a cadence around lapsed guests that includes personalized email, targeted social, and paid search outreach. Keep your automated lapsed guest content up-to-date with regular maintenance. Every six months, pull the entire list and test new platforms. Make sure to track engagement so you know what works.
5. Optimize for Conversion
If you want guests to keep coming back, you need to make sure that all sales channels are optimized for conversion. Otherwise, they’ll choose a different restaurant that meets their needs.
Framework You Can Use
Online Ordering: How easy is it to place an online order and checkout? If your menu is difficult to navigate or the checkout process is cumbersome, for example, your cart abandonment rate is going to be high. Ensure that your online ordering system enables guests to place an order quickly and securely. Bonus points if they can easily reorder their favorite items.
Convenience is Key: Can guests pick up their order curbside or in-restaurant? Is delivery an option? The more handoff options, the more likely guests will follow through with their order and keep coming back. In fact, according to Olo data, brands that enable four or more handoff modes typically see a 12%+ increase in conversion rate.
Google: Can people join the waitlist, book a reservation, or place an online order directly from your Google listing? If not, that’s one unnecessary hoop for returning guests to jump through. Eliminate friction by ensuring your Google listing is fully optimized for conversion.
6. Tighten the Feedback Loop
While 72% of guests will share a positive experience, for every 26 unhappy guests only one is likely to say anything to you. Good, fast, empathic guest feedback management is crucial. In addition, being proactive about collecting feedback is a great loyalty builder—77% of consumers view brands more favorably if they seek out and apply guest feedback.
Framework You Can Use
Build trust with a multi-level feedback strategy.
When a guest reaches out with valuable feedback in any way (third-party reviews, social media comments, survey responses), it’s essential to engage quickly. Acknowledge their experience and let them know from the beginning that you value their feedback, positive or negative. Take action to fix the problem. Say thank you.
Continue to build relationships by proactively asking for feedback (automated post-meal surveys work great). When guests reply, thank them and reward them.
For the super loyalist, consider consumer panel special events. “You are an important part of growing our brand and your voice matters.”
Take a moment for meta-feedback and ask how your engaged guests like to be contacted. Do they prefer a quick text survey, an email, a social form, or an in-person menu workshop? Are they okay being contacted after every visit, or do they prefer a couple of months between surveys? Make sure to contact them accordingly.
As a remote-first company, we work hard to keep our distributed team connected and provide an environment where employees can grow, learn, and celebrate their authentic selves. Our employee resource groups (ERGs) play an essential role in that effort by expanding our culture to be more inclusive.
[email protected] was one of the first ERGs to be formed, with the goal of connecting employees who have served in the U.S. Armed Forces, their families, and nonveteran colleagues to foster a culture of camaraderie, offer support, and advocate for veteran recruitment, retention, and promotion.
In honor of Veterans Day, we sat down with the ERG’s leader, Zach West, Director of Customer Success Management and former Green Beret in the U.S. Army Special Forces, to get the inside scoop on [email protected], why veterans are an asset to companies, and the importance of celebrating service members.
We have about 20 members, including 11 or so veterans. In addition to being a community and support forum, we’ve done a few events over the years, including interviewing a veteran business owner about his journey from the Armed Forces to running Southern Pines Brewing Company, and hosting a donation drive to benefit Razom, a nonprofit sending emergency supplies to Ukraine.
Why are veterans an asset to companies?
People who are involved in civic organizations are doing something that's greater than themselves. They tend to walk away with a better understanding of how to operate as a team and stay focused on their work. That type of selflessness benefits businesses as a whole because people are committed to the cause and will look out for one another. Veterans come from a mission-first background, so we will do whatever it takes to accomplish the end goal, leading to more efficient and productive companies.
What are some challenges facing veterans in the workplace?
Companies often overlook veterans as an underrepresented community. In reality, veterans are a diverse and vibrant group whose members intersect lines of gender, sexuality, and ability. What ties us together is a shared commitment to service, patriotism, and volunteerism. Companies should lean in and learn from their veteran community through inclusive practices, celebration, and recognition.
I want to make sure that our group is not just a support forum, but also focused on celebration. We highlight veterans in our company by honoring their service, engaging in conversations around current events, assisting non-profits who benefit places like Ukraine, and ultimately doing the best we can to create a welcoming environment.
Looking ahead, I’d love to see our company benefit the broader community, including hiring more veterans, partnering with other ERGs at Olo, and donating to a veterans-focused organization.
How can nonveterans show their support on Veterans Day and year-round?
Simply by being involved in different veterans organizations or nonprofits. There are a lot of awareness and support runs/charity races that exist out there. If there are local events going on, just showing up to support the cause is great.
Head to our People & Culture page to learn more about our ERGs, what it’s like to work at Olo, and our current job openings.
With the holidays right around the corner, restaurant brands of all types and sizes are gearing up for one of the busiest times of the year. To help you maximize revenue, guest loyalty, and employee satisfaction this season, we’ve compiled a comprehensive list of winning strategies—from menu optimization to ticketed events.
When creating your plan of attack, consider the time investment, resources, value-add, and potential ROI—short-term and long-term—for your specific brand.
1. Holiday Promotions
Get in the holiday spirit with an irresistible limited-time offer that motivates guests to take action. Fear of missing out (aka FOMO) can be a powerful tool.
Food For Thought: Give guests $20 off orders of $100+, free delivery with a purchase of $50+, or a free appetizer with their first online order.
Level Up: Generate excitement around the promotion on your brand’s social media channels via a holiday-themed countdown or photo contest that incentivizes participation and helps to grow your following.
Launch an omnichannel marketing campaign across email, SMS, social media, and digital ads to inform new and existing guests about your holiday offerings. This multi-platform approach will increase your brand’s reach and help you meet guests where they are.
Food For Thought: On Dec. 23, ask guests if they forgot someone on their list and need a last-minute gift. Use this opportunity to promote your best-selling cookie cake, gift card, merchandise, etc.
Level Up: Leverage your restaurant CRM to segment guests—high-LTV, big spenders, churn risks, online orderers, etc.—and then personalize communications based on their order history and preferences. A tailored message, served at the optimal time, on a guest’s preferred channel is a recipe for marketing success.
3. Restaurant Gift Cards
Gift cards have been a staple in the restaurant marketing playbook for years, but demand has never been higher. According to research conducted by the National Restaurant Association in 2021, “62% of consumers hope to receive a restaurant gift card for the holidays.”
Food For Thought: Give guests the choice of purchasing a physical gift card that can be sent by mail or a digital gift card that can be sent electronically.
Level Up: Offer a “Give a gift, get a gift” deal to incentivize gift card purchases (e.g. Earn a $10 bonus coupon for every $50 spent on gift cards).
4. Retail Items
Retail can serve as an additional revenue stream, advertising vehicle, and method of strengthening guest loyalty during the holidays and year-round.
Food For Thought: Restaurant regulars go wild for branded merchandise like BBQ sauce, T-shirts, and tote bags. Not to mention, they pair well with restaurant gift cards. Put them front and center in your restaurant, on the website, and on social media.
Level Up: A wine or beer club with membership perks like exclusive events, discounts on food, and priority seating can provide a predictable revenue stream for restaurants. Plus, subscriptions make great gifts at any time of year.
Restaurant brands can put a festive spin on their menu with holiday meal kits, family bundles, and/or seasonal items such as hot drinks and other cold-weather favorites.
Food For Thought: Alleviate the stress of cooking for a crowd with “Thanksgiving-to-go” or appeal to your guests’ nostalgia (and tastebuds) with LTOs like hot toddies or pecan pie.
Level Up: Full-service restaurants can offer an exclusive, holiday prix fixe menu for guests that want an elevated dining experience.
6. Online Ordering
Given how busy we all are during the holidays, online ordering is a no-brainer for maximizing revenue. Just be sure your digital order management solution can keep up. The right system will enhance front-of-house operations, streamline the order flow, and provide capacity management tools (e.g. throttling, item availability customization, lead time extension, etc.), so your team feels supported and can focus on guests.
Food For Thought: Encourage guests to order holiday favorites like honey-baked ham in advance. Then, recommend menu items that pair well or irresistible add-ons to upsell during checkout and increase average check.
Level Up: Provide a suggested tip during checkout to ensure team members get an extra boost during the holidays.
7. Multiple Handoff Modes
Consumer demand for convenience is at an all-time high during the holidays. Restaurant brands can ensure that every guest has access to their preferred method of ordering by enabling multiple handoff modes, including curbside pickup, delivery, and dine-in.
Food For Thought: According to Olo data, brands that enable four or more handoff modes typically see their conversion rate increase by at least 12%.
Holiday parties present a valuable opportunity to boost restaurant revenue via catering. With many businesses and families gathering to celebrate, brands should consider offering holiday packages for pre-order that meet the needs of guests and also increase brand awareness.
Food For Thought: Promote your Christmas feast or taco party pack—complete with utensils, napkins, plates, reheating instructions, etc.—on your website, social media channels, and digital ads.
Level Up: Create a catering-focused marketing campaign, including email, SMS, and/or digital ads, specifically targeting guests that have placed large orders in the past.
Reservations play an important role during the holiday season when demand for dine-in soars due to cold weather and the desire to celebrate with loved ones. They can be a source of stress relief for guests who want to plan for an occasion and make guests feel special by eliminating the wait. On the flip side, reservations enable restaurant staff to better prepare for busy shifts and large parties.
Food For Thought: Boost reservations by enabling guests to book from any platform—your website, app, Google Business Profile, social media channels, and beyond.
Level Up: Paid reservations or prepaid bookings are proven to drive down no-shows. Consider introducing a nominal, nonrefundable reservation fee to improve guest show rates and generate revenue.
10. Ticketed Events
Build a community around your brand and maximize revenue at the same time by hosting holiday-themed ticketed events at your restaurant. These events can appear right alongside your regular reservations, piquing interest among repeat and new guests.
Food For Thought: Host an Ugly Sweater Party, Friendsgiving, or a cooking class geared toward achieving guests’ New Year’s Resolutions, and promote the event(s) across your marketing channels.
Level Up: Use your table management solution to create customized floor plans and table assignments before the event, and be sure to accept payments ahead of time to take the guesswork out of your guest list and drive down no-shows.
11. QR Code Ordering
QR code ordering can boost revenue by enabling guests to access the restaurant menu, order, and pay, all from their own mobile devices while sitting at a table. When guests order from a digital interface—without having to stand in line, wait for a server, or stress about indulging in add-ons—check averages and tip income increase.
Food For Thought: To encourage adoption, display eye-catching signage in the restaurant with straightforward instructions for how to order and pay at the table, and designate a team member to assist guests if they need help.
Level Up: Incentivize guests to use QR code ordering during the winter months with targeted marketing campaigns that feature a special holiday deal (e.g. Free dessert with your first QR code order).
12. Outdoor Dining
To extend the outdoor dining season and maintain a steady flow of revenue in winter, restaurants should think creatively about their physical space and offerings. Outdoor heaters, branded blankets, a thoughtful menu featuring warm drinks and hearty fare, and a little bit of ambiance (bistro lights, anyone?) can transform any restaurant patio into a culinary destination.
Food For Thought: Promote an outdoor Winter Ale tasting or turn the parking lot into a drive-in theater with a family-friendly menu.
Level Up: Add a fire pit or an Instagram-worthy backdrop—think flower wall, large mural, patterned wallpaper, or a neon sign—to attract guests and generate buzz on social media.
13. Make Every Guest Feel Like a Regular
A lesser-known but highly effective way to boost restaurant profit year-round, but especially during the holidays, is by personalizing the guest experience. Brands can thoughtfully tailor every guest interaction, whether dine-in or takeout—no matter which team members are on duty—with an integrated tech stack that ties order history and other guest details in the CRM to the waitlist, reservations, order, and table management solution. In other words, make every guest feel like a regular.
Food For Thought: Alert managers about which table touches to prioritize during a busy shift or have a regular’s favorite drink prepared upon arrival.
Level Up: Send a targeted and timely SMS message to guests featuring an image of your new candy cane milkshake (or another seasonal menu item) that feels like it’s coming from a friend.
Contact us to discover more ways to maximize restaurant revenue during the holidays and year-round.
Inspired by Olo’s growth journey and steadfast commitment to helping restaurants do more with less, Priya Thinagar took on the role of Executive Vice President of Technology in late 2021.
Since joining, she has led our Product, Engineering, and Design teams to create best-in-class digital ordering experiences for off-premise and dine-in guests.
We recently sat down with Thinagar to find out why she chose to work at Olo, highlights from her first year on the job, the key to effective leadership, and more.
Why did you join Olo?
Restaurants are the stronghold of local communities. They act as impactful gathering places where people build relationships and make memories. But it's tough running a restaurant business—dealing with labor shortages, talent acquisition, and low margins. I thought of how cool it would be to help these local businesses thrive and do more with technology. Working in the intersection of two things I like the most, technology and food, is one of the reasons I chose Olo.
Additionally, as an aspiring entrepreneur, working in a founder-led organization meant learning from the best to focus on long-term guidance. A founder sees the company as their life’s work, so they are highly motivated to think about the long-term. I know from reading about successful founders that they have an owner’s mindset—speeding up decisions and a bias for action. Add a notch of purpose and you have this amazing formula that can drive individuals to impactful careers.
Lastly, when I started a year ago, Olo was going through a phase of intense scale. Having read “Blitzscaling” by Reid Hoffman and seeing the energy in fast-paced scaling to build sustainable organizations, I wanted to be at the center of the action-packed journey on this rocket ship.
Tell us a little bit about what you do.
I lead Product, Engineering, and Design for Olo’s core products and platform. Our mission is to remove any friction in the ordering experience, irrespective of the medium chosen to order. Our teams focus on reliability and scale, deeply embracing a data-driven culture to push our limits on being an elite organization.
Looking back on your first year at Olo, what are you most proud of?
First of all, I’m proud of the Omnivore acquisition, where we saw the potential of the data and sync with POS which unlocks new product opportunities and a strong technical team. In the last few months, bringing the Omnivore data together with Olo’s rich order data, and being able to drive insights for capacity, has been fun to watch. The best is yet to come.
The second is Borderless Olo Pay—from ideation to minimum viable product (MVP) in less than two quarters of bringing together a team. We set a clear vision and focus for them and let them autonomously deliver. To see guests saving credit card information so they can checkout without friction across Olo’s network of restaurants has been rewarding.
Looking ahead, what are you most excited about?
I see the potential of bringing the best guest experiences and operational excellence for our brands through our data science initiatives. We have seen accuracy in order promise times with just the order and make-time data. The possibilities are limitless.
The next generation of guests is technologically savvy, prefers personalization, and expects brands to meet them where they are. With restaurants investing in digital enhancements to appeal to this hyper-connected guest population, I see a lot of opportunities for Olo to help our brands revolutionize their business through technology.
Name three things you love about working at Olo.
1. The problems we solve with a ground ball mentality—there is never a dull moment. 2. The pace at which we operate helps our brands solve complex problems in a timely manner. 3. And, most importantly, my team and the leadership on my teams.
What makes a great leader?
Great leaders make hard choices in order to enhance the lives of others around them. They also have a blend of humility and unparalleled will to lead others in service of a cause that is bigger than themselves.
Any advice for aspiring women in tech?
My favorite woman leader, Eleanor Roosevelt, said, “The future belongs to those who believe in the beauty of their dreams.” Remain positively curious and remember that the future is what you make it to be, so dream big.
To learn more about Olo and apply for one of our job openings, visit our careers page.
CDP, Restaurant CDP, Restaurant Customer Data Platform, GDP, Olo Guest Data Platform
Despite the last decade of focus on the topic, restaurant brands of all sizes still struggle to collect, analyze, and most importantly, act on guest data to grow their business.
Restaurants face a mix of challenges with their guest data that fall into a handful of categories:
Lack of Access: Data is stuck in archaic systems and some tech vendors block access altogether
Lack of Integration: Data can be accessed, but, no team has the time or technology to stitch it together (or systems that strictly unify data add another layer of costs)
Lack of Actionability: Integrated data isn’t being passed to the tools that Ops, Culinary, Marketing, and/or Finance teams can actually use in their day-to-day
Lack of Ability to Test or Experiment: Any combination of the above makes it nearly impossible to test and pilot new strategies—from menu engineering to online and offline restaurant marketing efforts
With the rising importance of technology, many brands were just waking up to the fact that they didn’t have the data infrastructure they needed to succeed.
Practically overnight, brands were forced to confront these obstacles as they had to digitize their business and, in many cases, adopt tech solutions that threatened to disintermediate restaurant brands from their guests. This set the stage for the next frontier of restaurant growth, specifically, guest centricity and the ability to build an on-to-off-premise experience that is seamless, personalized, controlled by the brand, and driven by data.
Definition of CDP
Customer Data Platforms (CDP) exclusively serve the purpose of ingesting data, creating a single view of the guest, and piping that data to end platforms where it can add value.
So how does this new tech category fit into the restaurant tech stack? And is a CDP right for your restaurant?
Start by evaluating where your brand is today and then identify the data architecture that will serve your brand for the next decade.
Signs You Need a Restaurant CDP
Data deserts: “I wish I could do X, but can’t get the data from A to B”
Manual workflows: “We will need another person just to analyze X data”
Tech-stack dependency: “We can’t implement X until we have Y in place”
Vendor lock-in: “We can’t afford to leave X—they just have too much control over valuable data about our guests”
Say Goodbye to Data Silos
Here’s the real revelation of CDP: it’s a single solution to ingest data from any source, merge that data to a single guest record, then send it to the right destination.
With a restaurant CDP, you don’t have to think about whether the vendors you’re working with will give you useful data—your CDP is there to ingest and make that data usable.
To help visualize this point, see the graphic below. While everyone looks at charts like this and gets excited about “dream scenarios” in the top right—without a clean, usable, data foundation, they’re just that...dreams.
Benefits of a Restaurant CDP
To determine what a restaurant CDP like Olo’s Guest Data Platform could unlock for your brand, start by mapping out your current tech stack, with a specific lens on data sources and destinations.
Destinations are vendors who will help you act on the data. Examples include email and SMS marketing, search and social ad platforms, business insights tools, and even data warehouses.
It’s worth noting that sources can be destinations as well. An example of this is enriching guest data back into your restaurant CRM to fuel more impactful, targeted search, social, and even email/SMS campaigns.
This data source/destination exercise will get you to somewhere like this:
How a Restaurant CDP Works: The Loyalty Program Use-Case
Imagine you’re a restaurant brand years into a loyalty program offering, yet, your loyalty vendor’s messaging solution doesn’t fully meet your expectations. Or, you want to facilitate personalization based on more data than just what’s within your loyalty/offers solution.
Are you stuck? Marketing leaders at many brands have said they feel that way. But, that doesn’t have to be the case.
By adding a restaurant CDP to your tech stack, you’d be able to—in this example—ingest points, spend, offer, and redemption data back to a centralized guest record that can also include data from web, social, or on-premise interactions not captured by a loyalty solution. Data could then be pushed to the destination vendor best suited to meet your goals. The bottom line is that the added flexibility of a CDP ensures you don’t have to switch one vendor to accommodate another or to adopt a new strategy.
Further, you can push this singular, enriched guest record to a marketing execution platform of your choice. This unlocks the ability to build conditional messaging flows that drive guests further down the funnel to habituation, all based on their unique interactions with your brand.
It's Time to Harness and Act on Restaurant Data
To remain competitive, leading restaurant brands will create data architecture that puts an accessible guest data layer at its core—combined with modular, best-in-class applications to act on the data. This idea is not new to digitally-native companies, like e-commerce, that are disciplined at tracking every step of their guests’ journeys because the needed data architecture is already built into their platform and experience. Now is the time for brick-and-mortar businesses like restaurants to reclaim their guest data and put it to work.
In an increasingly contactless world, payment processing for digital transactions has become a priority across industries. But for restaurant brands that have spent years bemoaning antiquated payment systems for their endless fees, security issues, and lack of tech integration, it can be a sore subject.
The truth is: A traditional payment processor simply doesn’t cut it anymore. Restaurant brands must have a comprehensive payment platform to streamline their tech stack, drive direct sales, and unify siloed data.
But implementing any new system is no small undertaking. Budgets are tight, labor is strained, and yet, innovation is key to remaining competitive.
So when is the optimal time to upgrade?
Start by asking yourself the following questions.
10 Things To Consider Before Implementing a New Payment Stack
What are your current authorization rates? Have they been increasing or decreasing?
What are your cart abandonment rates? Are they trending up or down?
Which fees on your payment service provider’s statement can you not confidently explain?
How do your payment acceptance costs vary from quarter to quarter?
What are your current rates of fraud and chargebacks? Have they changed over time?
What are your costs of chargebacks, won and lost?
What are your administrative costs for handling chargebacks?
What kind of payment tokens do you use and what is the cost?
What are the costs of maintaining your payments platform as it relates to keeping up with new network rules and requirements? (PCI compliance, reporting, interchange changes, etc.)
How is card life cycle management handled?
If your restaurant brand is consistently embattled by fees, struggling to manage chargebacks and PCI compliance, and/or experiencing high cart abandonment rates, it’s time to update your payment system.
What To Look For in a Restaurant Payment Platform
A modern restaurant payment platform will not only simplify operations but also enhance the guest experience. It shouldn’t just solve existing problems, either; it should be future-proof to ensure that as you build out the rest of your restaurant tech stack, it will continue to meet your needs.
To set up your brand for success, make sure your payment system checks all of these boxes.
Transparent Fee Structure
The cost of accepting payments goes beyond the processing fee and often includes other charges. Traditional payment processors will sometimes hide fees, overcharge for services, or charge for unnecessary items.
Hidden fees are often considered markup costs and can be charged on a transaction basis or monthly. They can include PCI fees, software fees, gateway fees, CPU fees, AVS fees, equipment costs, and more.
All of these fees are negotiable and should be reviewed prior to implementing a payment system.
Multiple Payment Options
To effectively drive sales, restaurant brands need to optimize for conversion. That includes offering a seamless checkout process with multiple payment options for guest convenience.
Look for a payment platform that enables guests to pay with their digital wallet (Apple Pay, Google Pay) and save a card on file for faster checkout on subsequent visits. The fewer barriers—manual credit card entry, password management, etc.—the better.
Advanced Fraud Protection
As the number of digital transactions continues to skyrocket, restaurant brands need to be vigilant when it comes to fraud. Each restaurant transaction could be made by a real guest or a scammer.
While many restaurant brands are forced to purchase fraud protection from a company outside of their payment processor, a comprehensive payment platform will include it within their offerings and the upfront cost.
A modern payment stack can tell the difference between scammers and actual guests by leveraging machine learning to catch fraud and accept legitimate transactions. While some chargebacks are unavoidable, the right technology will limit fraud to a bare minimum.
In order to truly know your guests, you need a restaurant tech stack built with systems that talk to each other. That way, you can collect, analyze, and act on unified data. If your payment processor, online ordering solution, CRM, POS, etc. do not share data, you’re not getting the full picture of the guest's journey.
By eliminating data silos, you can gain a comprehensive understanding of each guest, including their purchasing behavior, preferences, and long-term value to the business. So, before selecting a payment platform, ensure that it fully integrates with your existing tech stack.
One of the biggest challenges of implementing a payment platform is the amount of time and resources it takes for a successful roll-out brand-wide. Between staffing challenges and razor-thin margins, quick and painless onboarding is key to successfully standing up any new restaurant system.
When vetting payment solutions, find out what the onboarding process entails and approximately how long it will take—depending on the vendor, it could take days or weeks to set up a new merchant account—so you can anticipate the impact on operations and prepare.
While no single payment platform works for all restaurants, the right system will lay the groundwork for sustainable business growth while improving day-to-day operations for staff and the overall guest experience.
For example, since switching from a legacy processor to Olo Pay, our restaurant-specific payment platform, WaBa Grill has seen a significant reduction in fraud and fees, as well as an improved authorization rate that has resulted in additional revenue. Read the case study for details.
Before implementing a new system, it’s good to know what’s working and what isn’t with your current setup—and the direction you want to move in. Once you have a baseline established, you can better evaluate each vendor’s differentiators and how they can meet your brand’s needs today and in the future.
QR Code Ordering, Dine-In Ordering, On-Premise Ordering
The pandemic made QR codes ubiquitous, particularly in the hospitality industry. Contactless menus and payment quickly went from being a safety precaution to a staple at many restaurants.
While diners had to initially adapt out of necessity, many have come to accept and even embrace QR codes for their convenience. Now that dine-in is back in full force, restaurants can further leverage QR codes to optimize operations and create a seamless guest experience.
What is QR Code Ordering?
QR code ordering enables guests to scan a QR code to access a restaurant’s menu, place an order, and pay for a meal, all from their own mobile devices. The QR code is typically found on a tabletop sign or sticker affixed to a table inside the restaurant.
With QR code ordering, guests have the flexibility to choose how, when, and what to order—without having to stand in line or wait for a server. Additionally, guests benefit from faster service, more control over order accuracy, the ability to easily add items to their meals, and quickly pay when they’re finished.
QSR and fast-casual brands like Nando’s offer QR code ordering inside some of their restaurants and the reception from guests has been overwhelmingly positive.
5 Ways Restaurants Can Benefit from QR Code Ordering
Though QR code ordering is a guest-driven dining experience, the technology can support restaurants in a myriad of ways—from financial, to staffing, to data collection, and more. Here are five examples that come directly from Olo data and feedback from restaurant brands that we support.
1. Revenue Boost
According to Olo data and industry data at large, check averages increase by $2-4, or roughly 12%, when guests order from a digital interface. Why? Because guests can spend more time perusing the menu, easily add and pay for items, and indulge in add-ons without fear of judgment.
As a bonus, generally, there are limited costs for restaurant brands to get started with QR code ordering (keep scrolling for setup details).
2. Increased Staff Efficiency and Satisfaction
By eliminating unnecessary touch points between restaurant employees and guests, QR code ordering optimizes staffing needs. Fewer trips to and from tables mean brands have the freedom to reallocate employees to greet guests, prepare food, etc.
When guests have the power to determine exactly what and when to order, their satisfaction tends to go up, which can lead to an increased tip income of $1.50 per hour on average.
Higher pay, less stress, and the freedom to put in more face time with guests can boost job satisfaction and retention of restaurant employees.
Since QR code ordering puts guests in control of placing and paying for orders directly from their phone, communication issues with staff often decrease, and order accuracy increases. Fewer mistakes mean less food waste and a smoother experience for all.
4. Faster Table Turnover
Restaurant guests often wait anywhere from 15 to 20 minutes for their check to arrive at the table. It’s a common pain point that can easily be resolved with QR code ordering.
When guests aren’t waiting for a server to order or pay for their meal, orders get fulfilled faster and there’s less delay for incoming guests. In other words, with QR code ordering, more people can ultimately be served—a win-win for the restaurant brand and its guests.
5. Data Collection
Restaurant brands that leverage QR code ordering can see up to a 5x increase in first-party data collection compared to traditional dining experiences.
While historically dine-in guests have been difficult to identify and learn from, QR code ordering enables brands to better understand dine-in guests’ preferences and behavior, as well as grow their marketable database, by digitizing every transaction.
When brands analyze and act on those insights, they can create Digital Hospitality at every touchpoint and maximize lifetime value (LTV) through personalized service, 1:1 marketing, and more.
Getting Set Up with QR Code Ordering
Unlike some restaurant technologies, QR code ordering is generally quick to stand up for brands that already have online ordering and can be very cost-effective. In most cases, no hardware is needed since the ordering platform is a guest’s mobile device. The only out-of-pocket costs include training employees, setting up QR codes at each table, and developing promotional materials.
To boost awareness, educate guests, and encourage the adoption of QR code ordering, brands should display positive, straightforward messaging in and around each restaurant. Eye-catching door and window decals, signs in traditional ordering areas, table displays, and even staff T-shirts or buttons, are great ways to get the word out at each location. And don’t forget about online—a restaurant website, social media, and email marketing are important channels for educating guests.
To find out more about QR code ordering and how it can support your restaurant operations, visit our Ordering page and contact us.
Photo Credit: Alba Lantigua from Unsplash and Blue Bird from Pexels