By Barbara A. Worcester H&MM Senior Editor
May 1998 - The Cafe at the Days Inn in Manchester, N.H., appealed to
no one. The 50-seat restaurant served hotel guests only, though not by
choice. While the chef prepared good food, it could not draw local traffic.
The problem was that the restaurant was a relic, and did not meet the needs
of potential patrons. So how did The Cafe go from a hotel restaurant with
revenues of $290,000 in 1997 with no local business to a projected
$800,000 steak-and- ale pub in 1998, with 50 percent of its business coming
from the local community? By tapping its
point-of-sale system to access guest information, and then using that information to determine the needs of its patrons.
"It was a sleepy little cafe," said Mark Bouzianis, owner of the now Sheraton Four Points hotel. In March 1997, the property underwent a franchise conversion. "We had adequate space, and were in a great location, but we couldn't attract the locals."
Bouzianis called on Charlotte Bogardus, president of the Gazelle Group,
a Needham, Mass.-based research, consulting and database-management company,
to survey guests, members of Sheraton's frequent-guest program and local
patrons to find what they wanted in a hotel restaurant-and, more specifically,
what type of
restaurant was lacking in the community. What Bogardus found was that everyone liked the restaurant/pub concept, particularly a steak-and-ale house.
Ten miles from the hotel was a microbrewery popular among the locals that brewed Nutfield beers. Bouzianis approached the Nutfield Microbrewery and asked its owners if the hotel could put the Nutfield name on its restaurant. In July 1997, the hotel opened the 76-seat Nutfield Ale & Steak House, featuring Nutfield beers on tap and Nutfield beer-cooked items on the menu.
"Our business has tripled in one year," Bouzianis said. "We've become
so popular, that we've added a frequent-diner program-after spending $100,
patrons get a $10 dinner gift certificate. We've also added the Nutfield
Mug Club, where for $45, patrons get a personalized mug, T-shirt and hat.
When they come to the
restaurant, they can use their mug to get a 20-ounce Nutfield beer for the price of a 16 ounce beer, and all appetizers are half price."
"The problem many hotel restaurants face is that they are product driven, not market driven," Bogardus said. "The restaurant is usually conceptualized around a theme or product idea. This usually happens when a chef has a particular specialty or when an idea is copied from a successful establishment in another city." Instead, Bogardus said restaurant and hotel developers need to talk to the locals and hotel guests and create a concept based on research to determine the market need.
"This is an industry that has traditionally relied heavily on intuition in deciding what hotel guests and local patrons are seeking in a hotel restaurant," Bogardus said. "We realized an opportunity to use our proven hospitality research methods to determine the best restaurant concept and execute that concept to fill a genuine customer-driven market niche."
Once the concept is executed, Gazelle's foodservice software integrates customer information with POS data and provides decision support on the hotel's desktop. "This is helping a lot of f&b operators stay ahead of the curve and lead the hotel restaurant industry's move into profitable, market driven, locally viable entities," Bogardus said.
When Gazelle is integrated with a POS system, it is able to extract customer data from credit cards, reservations, take-out services, comment cards, phone numbers and frequent-diner profiles.
"The software has more than 50 preformatted analytical reports and strategic goal-setting and database-management features for turning the data into actionable strategies and tactics for growth," Bogardus said.
The Sheraton Four Points will install the Gazelle software once an interface is worked out with its MICROS 2700 POS. Gazelle has a strategic alliance with MICROS to cross market their products.
ITT Sheraton Corp. recently completed a research project with the Gazelle Group on a corporate level. "Having completed a research project with the Gazelle Group, we can now feel more confident that we will provide the right restaurant concept and menu to satisfy our diners' tastes and desires, and contribute to success in an increasingly competitive restaurant market," said Denise Coll, senior v.p. with ITT Sheraton.
While several of the industry's property-management systems interface with restaurant POS systems to provide hotel-guest information, the data typically retrieved is used for operational reporting, such as number of guests and overall revenues. Until recently, hotels haven't used customer information from the POS to help them market their restaurants.
Jennifer Maggard, marketing manager Santa Barbara, Calif.-based InfoGenesis, said the InfoGenesis POS is unique in that it can capture any data down to the check level that allows hotels to do market-based analysis. In addition, the InfoGenesis POS is able to collect customer identifier numbers, such as credit- card numbers and zip codes, to allow hotels to capture and sort demographic information.
"We haven't seen our hotel customers using the POS to build their marketing programs yet," Maggard said. "A few are looking at the possibility, and some will actually implement frequent-diner programs in the next few months." She said the InfoGenesis POS is Windows NT-based and uses Microsoft Access and Sequel Server as its database. By clicking on a toolbar button, users can export any report filed to Microsoft Word or Excel.
"InfoGenesis' POS is a user-friendly export utility," Maggard said. "You can export data from the POS and manipulate it for a number of different applications."
Mike Duffy, manager of information systems at the Four Seasons Hotel New York, said he is researching Gazelle in the hope of convincing management that an automated customer-information tool is needed to help pull data from the hotel's POS in its 57-57 fine-dining restaurant. Currently, the property uses the NCR 2760 POS, but will move to the MICROS 8700 later this year.
"Right now, our POS isn't providing us with anything in terms of data or patron information," Duffy said. "It's simply acting like a big calculator-and it's a neat way to place orders with the kitchen." Duffy said the only information the hotel accesses is what comes from canned POS reports. Any additional information, such as server productivity and top menu sellers, is being put into a spreadsheet manually to see what is profitable.
"We have manual reporting tools in place that give us monthly revenues,
cover counts and average check information-the things you need to run an
operation overall," Duffy said. "But I want to start getting underneath
those numbers to see more specifically what's selling in the appetizer
area and where restaurant patrons are coming from. We know who our hotel
guests are, but we need to know more about the local market."
Duffy said that Gazelle caught his attention because it allows hotels to tap into marketing information that is sitting within the system and is not being utilized.
"We could get to the information manually, if we had the manpower and the time to sift through credit-card receipts and check vouchers," Duffy said. "But I know there is software available to do the legwork for us, and it doesn't make sense for us to do it manually any longer."
Duffy said he will continue to research products on the market and hopefully will propose an automated customer-information system solution to management soon.
The Le Meridien Hotel in Boston is the first luxury hotel to install the Gazelle software system. Bryan DeLonais, director of f&b , said he is constantly looking for new ways to enhance revenues.
"F&b used to be an amenity," DeLonais said. "Now, from an owner's
point of view, it's a business. Any f&b operator will tell you that
you need to continually produce a bigger bottom line. That's what Gazelle
is going to help us do." DeLonais hopes to produce that bigger bottom line
by identifying who his core guests are at The Julien, the hotel's fine-dining
French restaurant, and the Cafe Fleuri casual-dining restaurant. "It's
so important to know who your guests are, where they come from, their ages
. . even what they read and what they drive," DeLonais said. "The Gazelle
software can do all that for me. It allows us to better service our guests
will put us ahead of the curve."
Riad Shalaby, general manager of Las Vegas-based Data Designs, a division
of Group 1 Software, said database marketing applications for f&b are
not inappropriate, they're just typically not available. Data Designs builds
warehouses and data marts for hotel companies that wish to use the information for database marketing applications.
"POS systems in most automated hotels have interfaces to the PMS," Shalaby said. "If a hotel guest eats in the restaurant, chances are high that the meal was charged to his folio. This interface will enable a hotel operator to get profile information on the hotel guest-but not on a walk-in restaurant guest." Shalaby said that for marketing purposes, the POS must contain the name of the individual and have some other ability to link data to that name.
"It's very difficult for an f&b manager to take credit-card information and integrate it into a marketing program," Shalaby said. "I've never seen it implemented or executed reliably in my travels." He said that restaurant managers are much too busy with managing the overall operation to worry about tracking credit-card information.
"We are seeing an increase in the sophistication at the POS level, and
devices will probably be modified to add a marketing utility. Marketing
managers and Credit-card processing companies can immediately provide hotels
with specific demographic information on guests. Hotel operators should
contact the local newspaper and cable company to purchase data on potential
patrons by zip code, Shalaby said. "There's a lot of opportunity out there
to take information from f&b guests and use that information to create
customer relationships," he said.