The restaurant industry is facing new challenges as customers expect a great experience across every touchpoint and channel. Winning restaurants embrace technology to create the customer experience of the future, while finding new ways to diversify revenue, transform operations, and rethink store formats. At Fahrenheit 212, we have partnered with some of the best-in-class CDRs/FCs/QSRs to bring new experiences and products to market. In the process, we have identified four emergent business opportunities based on the ever-evolving landscape around us. If these key opportunities aren’t on your radar, or don’t occupy a line on your strat planning gantt, they should be. 

Preserving brand experience amidst the boom of off-premise dining.

Within the four walls of the restaurant, consumers engage with more than the menu -  they immerse themselves in the complete brand experience, engage with bespoke service touchpoints, and explore the dining atmosphere. As such, players in this space don’t just charge for their food, but also put a price  on the complete value proposition that they provide. 

But today, off-premise dining is bigger than ever (take out, delivery, and catering) - and in these moments, food is the only component of the brand’s value proposition  that consumers engage with. Without the complete brand experience, the competitive set becomes vast (Is your brand known for its burgers? Every diner and bar on Seamless delivers burgers.), but also the offering becomes commoditized. This leaves the off-premise value proposition vulnerable.

We believe the paradigm that restaurants can only export their food should be turned on its head. Instead of focusing solely on the food, brands need to ask, “What is the complete off-premise value proposition that brings my brand to life?” 

Technology integration that enhances both a brand’s value proposition and its bottom line.

Rising costs of labor have given technology companies a compelling platform. But service and labor aren’t just expenses - they are tied to key drivers of the guest experience and overall value proposition, and therefore deeply connected to revenue. 

Before adopting and implementing technology, it is essential to understand why guests are visiting a brand’s establishment: the objective and benefits of service and labor in those moments, and how they contribute to the experience, both positively and negatively. For example, bartenders do more than just mix drinks. They are companions for guests who dine solo, and brand ambassadors who guide guests in making the best menu choices. But bartenders can also slow down service during peak hours. While tech may harm guest experience in the companion and brand ambassador moments, it improves it during happy hour chaos. 

We believe tech is the how, not the what. Before tech is adopted, brands must first ask themselves - which moments are right for technology, and how might our service and  labor need to evolve around this technology? Only then can tech truly lower costs while enhancing the value proposition.

Rethinking the franchisee relationship.

While profitability is top of mind for all franchisees, their motivations, level of experience, and needs vary drastically. Standardization is critical for franchised brands to scale and maintain a consistent experience, but that same rigidity can be frustrating and demotivating for franchise owners who see themselves as innovative, entrepreneurial, and deeply immersed in the challenges affecting their business. 

When it comes to consumers, brands have acknowledged the need to segment and design against different personas, so why do brands insist on a one-size-fits-all approach with their franchisee partners? We believe the differences among franchisee owners should be acknowledged, embraced, and designed around a portfolio approach of franchisee solutions. Instead of treating all franchisees the same, brands should ask, "what are the different franchisee personas, and how will that inform my programing and initiatives strategy?"

Designing the store experience to meet the demands of new channels.

Convenience has reached a critical pitch and as the future of delivery and autonomous driving converges on us, brands need to think about how their experience should  evolve - or change completely. They need to look at product design, the physical space, and even the primary “customer” (consumers, delivery drivers, autonomous cars, drones, etc.) they serve.

While many brands are thinking about this future, most are thinking about it in the context of the assets that they have today - an inside out approach. Conversely, many consultancies take an outside-in approach - imagining a future state with no guardrails, which leaves little to no action for brands to take toward that end state in the near term.  

We believe brands should ask, “what is the optimal future experience, and what is the actionable path of progress toward that future in the short, medium, and long term?”  

 


At Fahrenheit 212, we have already taken on many of these challenges for our clients, and are happy to discuss macro insights with you, as well as find ways to unlock value within your key initiatives. 

If you are interested in learning more, please reach out to:
Jamie Podhaizer
Director of Strategy

Kate Fairweather
Sr. Innovation Consultant

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