Insights
Oct 24, 2022
 – WRITTEN BY 
Tyler Felous
5
 min read

What Is a CDP and How Can It Fuel Restaurant Growth?

This article outlines:

What is a Customer Data Platform (CDP)?

Signs Your Restaurant Brand Needs a CDP

The Benefits of a Restaurant CDP

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.

Enter COVID.

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.

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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.

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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.

Olo Restaurant Data - CDP

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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.

Sources are any vendor or channel that captures guest data. Examples include POS, WiFi, waitlist & reservations, loyalty, email/SMS, brand website, guest app, online ordering, restaurant payment processor, social media, surveys, third-party reviews, etc.

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:

Olo Guest Data Platform for Restaurants
How Olo's Guest Data Platform—a CDP purpose-built for restaurants—works

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.

Learn about our Olo’s Guest Data Platform, a restaurant-specific CDP, and contact us to find out how it can take your business to the next level.

Main photo credit: Lexie Barnhorn from Unsplash

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.

Tyler Felous, VP Product, Guest Engagement
Olo

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