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Venture Capitalists Are Going for Data Driven Restaurant Concepts

There is no doubt in anyone’s mind that technology has dramatically changed the restaurant industry, with new concepts popping up seemingly every day. The data driven approaches of newer brands such Blue Apron, UberEats and PostMates are leveraging smartphones to bring convenience to the masses. Meanwhile, traditional restaurants are jumping on the technology train with customer-facing tech like table-side tablets, and back-end systems that analyze enormous amounts of customer and trend data.

As reported by Wired, venture capitalists are “hungry for fast-casual ‘Food Platforms’”, restaurant concepts that leverage customer data and technology to personalize and streamline offerings. Last year, fast-casual concept Sweetgreen raised $200 million in funding, as investors turn their attention towards millennial friendly “early-stage scalable restaurant concepts”. By scalable, they mean concepts that have the potential to become large enterprises driven by customer data. As Wired mentions, a large chunk of Sweetgreen’s customers use the food service through the official app, which is able to collect data on what, where, and when customers are using the service.

Just like analytics data on a website or social media network, app data allows operators to trim fat and improve efficiency by zeroing in on exactly what customers need and expect. Sweetgreen even goes so far as to use “IoT sensors at suppliers’ farms” to enable “tracking produce from seed to store”, allowing them to minimize waste (and lower costs). There are even plans to tailor food offerings based on a customer’s genetic tests (think 23 and Me), an unproven idea that nonetheless is sure to intrigue the technophiles among us. This kind of business model has only recently become possible with the advent of comprehensive and affordable technologies. Take a step back to look at the bigger picture, and it’s no surprise that venture capitalists are interested in throwing huge sums of cash at these concepts; they are very reminiscent of the silicon valley start-ups that have become meme-level ubiquitous in the technology space. Food delivery companies like UberEats and PostMates which also have acess to a lot of customer data, are in the same vein.

For existing restaurants, there is still a lesson to be learned here. Even if you are not looking for investors, the growing success of companies like Sweetgreen demonstrate the immense value of data that technology can collect about customers and supply chains. Offline restaurants (those that use minimal or no technology in their operations) are quickly learning that the days of creating a simple website are over. While there are always outliers, success today means adopting a comprehensive online strategy complete with a mobile friendly website, a heavily managed social media presence and a command of review sites such as Yelp!. Across the entire hospitality industry (and most other consumer-facing industries) collecting and analyzing data has become a critical tool for guiding operational strategies.

What technologies are you using in your restaurant, and what have they taught you about your offerings, your customers and your operations? Have you made any changes to your business based on feedback from technology? Let us know what you think on Twitter, Instagram and Facebook.

via Wired