This article was initially published in the October issue of Global Drinks Intel magazine. For details on how to subscribe, click here.
Bar owners are navigating a minefield of staff shortages, energy costs and consumer demands. Millie Milliken asks tech companies how they’re helping the on-premise channel navigate the challenges.
When it comes to the hospitality industry, the last two years — much like other industries — have seen a huge acceleration in the adoption of technology, especially consumer-facing solutions. The pandemic accelerated the pace of digital transformation by ten years, according to McKinsey & Co, and the hospitality industry saw an influx of apps launched to aid businesses working around COVID-19 restrictions, from social distancing to track & trace, and everything in between.
Consumers became accustomed to ordering and paying in on-premise venues using QR codes and apps. And now, venues utilising a hybrid payment model (both QR codes and in-person ordering) are still keeping technology integrated into the out-of-home experience.
Despite the end of operating restrictions around most of the world, other factors continue to hamper bar operators and owners, so technology is proving to continue to be an important tool, both in front of and behind the bar, for helping venues back to recovery.
In August, according to the Office of National Statistics, 30% of UK hospitality businesses reported that job vacancies were more difficult to fill than normal, compared with 13% across all industries; the cost of living crisis is also hiking up energy bills for outlets, meaning that staffing costs and booking cancellations are having a major impact. Subsequently, a combination of consumer expectations and unpredictability have put technology companies under the magnifying glass, along with their ability to deliver in a slick and quick manner.
Brave new world
In recent months, late-notice cancellation solution app Ambl launched in the UK. Founded by Aaron Solomon, the new tech offering has been created to give consumers real-time information on table availability at bars, pubs and restaurants in their area, while also offering operators a solution to last-minute table and bar booking cancellations or no-shows.
Solomon was working in sales in the City when he had the idea of Ambl. “We came back from lockdown and my manager asked me to book a table for eight of us,” he says. “I went on Google ResDiary and it was a nightmare. I thought, ‘Why can’t I just broadcast this out to all these restaurants?’”
Three months later, Ambl has 14 employees and 1,300 venues.
Immediate, demand-driven expectations from consumers are driving innovation in on-premise tech. “Consumers expect much more from technology since the pandemic,” explains Patrick Clover, founder of data capture & marketing app Stampede. “The difference between a slick and clunky system is more obvious to consumers now and it affects their overall experience. We’ve always taken the approach of making things as frictionless as possible, both for our users and for customers that visit their bars.” Things like guest WiFi that remembers customers the next time they visit the bar and automated birthday offers, says Clover, can really make a difference.
Speed of service is also something that Luke Ireland, co-founder of online ordering, venue & event management app Creventa, has made a focal point of his service. “Our thing is always speed of performance and being able to order drinks in four clicks,” he says. “No barriers, no collecting a load of data — once you’ve set up your payment, it’s really easy to order.”
Online ordering system Hungrrr, which launched in 2018, has also discovered that consumers are looking beyond bars and pubs for seamless hospitality experiences that involve technology. “One of the most exciting growth areas right now is hotels,” explains co-founder Mike Callachan. “We’re helping drive incremental revenue for zero-night-stay customers, as well as the captive audience of overnight guests, who want to order from the hotel bar and restaurant quickly and easily and without having to pick up the phone and speak to reception.”
Return on investment
Of course, while keeping consumers’ needs met is a priority for tech providers, so are the needs of the businesses that invest in them. “Bar owners are looking for three things now: Simplicity, more sales and proof that the tool is doing its job,” Clover says, adding that Stampede makes sure to prioritise financial results and trackable return on investment.
There also needs to be quick training for staff and on-the-minute response times for operators, something that Ireland has implemented at Creventa. “Unfortunately, the bar tech industry has a poor reputation for customer service,” he says. “We support our customers via WhatsApp and also provide them with reference customers, so they can ask another venue about their experience.”
External marketing also means that on-premise outlets can have touchpoints with their consumers when they aren’t in the venue, which is the crux of what Stampede does. “When it comes to digital marketing, a lot of them are not sure where and how to start,” says Clover. “Many tools out there are overly complicated, which makes them hesitant. Stampede makes digital marketing simple for them — they also get much higher results by spending less time and money on it.”
Callachan also points out the power of indirect app marketing: “The value of having your company app as one of the icons on your customer’s home screen cannot be underestimated.”
Future-proofing
Following Ambl’s launch, founder Solomon and partnerships manager Drew Mallins — who has worked in hospitality for more than 12 years and runs the 30,000-strong Facebook community, London Bartenders’ Association — are keen to grow the app into an education and training source for the on-premise community and, in turn, contribute to the ongoing staff shortages impacting the industry. “I want to help with staffing in any way I can,” says Solomon. “When we get bigger, we can sponsor mixology and marketing courses, as well as help workers move up in what they’re doing in hospitality.”
Recruitment challenges are at the forefront of many operators’ minds. “We’re hearing a lot about the increasing costs to run a bar and the lack of labour,” says Callachan. “Our solution allows a bar to run with fewer staff, solving that problem at the same time as driving profitability through a lower headcount with fewer servers and higher average spend per head when ordering on our platform versus at the bar.”
Hungrrr has experienced “explosive” growth and Callachan has found that larger venues or those with terraces or outdoor table areas where servers might not be available — BrewDog, for example, uses it in over 100 bars across the UK, Europe, Australia and the US — are really seeing the benefits.
Rising prices also mean that some businesses are looking to maximise on their space by organising events on quiet days. In response, Creventa has added an event management element to its system, allowing operators to introduce measures such as food orders and table plans with ease.
The rapid evolution of apps is something Clover maintains is a strong offer for venues that don’t have to create an ‘integrated tech stack’, but can have a more hands-off experience by using minimal technology that covers a wider range of issues, or “more complete solutions”.
This article was initially published in the October issue of Global Drinks Intel magazine. For details on how to subscribe, click here.
