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April 25, 2016
Restaurant marketers still struggle to reach customers in the ages 18-35 demographic. But the results of a massive new survey backed by database and enterprise software giant Oracle provide plenty of clues about how they can. Not only does “Millennials and Hospitality: The Redefinition of Service” help define ways restaurants can establish and maintain relationships with tech-savvy young consumers; it also suggests that restaurant employees can be leveraged to streamline the process.
“The power of mobile technology is radically altering consumer expectations,” declares Oracle, which acquired hospitality software and hardware firm Micros in 2014. “Such change is requiring a redefinition of service—one that offers millennials choice, speed and personalization based on their individual preferences. Historically, service defined how technology was used in a particular operation. Today, mobile technology is requiring hospitality operators to reassess the service they offer—and redefine it.”
Oracle went big on this project. Early in 2016, the firm surveyed 9,779 millennials in eight countries. Questions were designed to gain feedback on how they use technology to interact with restaurants and hotels. Roughly 3,700 of the respondents had worked in one of these two hospitality industries during the previous five years. Members of this subset were also quizzed on how effectively their employers had used technology.
The survey first sketched the lay of the technological land. In the U.S. 89 percent of millennial respondents said they used their smartphone every day; 39.8 percent were daily iPad or other tablet users; 37.9 percent put in time on a desktop computer; 73 percent fired up a laptop; and 7.8 percent wore an Apple watch or other smart watch. Just one-half of one percent of respondents did not use at least one of these devices daily. If you were wondering how pervasive personal technology has become within the millennial demographic, here’s your answer.
Then the survey looked at how millennials use these devices as it relates to hospitality. It identified three disconnects between what restaurants offer and what customers want.
One discovery was a wide gap between the percentage of respondents who already manage hospitality loyalty programs via mobile device—23.2 percent in the U.S.— and the much-larger number who wished they could—51.68 percent. Oracle thinks operators are missing the boat on this one.
“This represents a huge opportunity for food and beverage operators,” the company declares. “Millennials are willing to share data in return for personalization and acknowledgment. This means that you can gather invaluable information on behavior, target promotions to increase average order value, and deliver special guest experiences that fuel repeat business.”
A second finding showed a similar gap exists for ordering food and beverage via a mobile device. In the U.S, 38.5 percent of millennials have already placed a delivery/takeaway food and drink order using a mobile device. Fifty-six percent want to.
“This shows that the expectation for mobile ordering exists, and when smartphone ordering is available, consumers will use it,” Oracle explains. “The other takeaway here is that demand for ordering via smartphone is not universal among millennials. There are plenty that want to give their orders in person and expect stellar service in the process.”
A third gap involves payment. 28.7 percent of U.S. millennials have already used a mobile device to pay for food and drink purchases; 43.6 percent want to pay that way.
If operators equip their restaurants with the necessary tech capabilities to meet millennial desires, will millennials actually use them? The numbers indicate they will. The survey found that only five percent of U.S. millennials said they would not use a mobile device in a restaurant.
However, Oracle cautions that traditional modes of interpersonal hospitality still matter.
“Millennials’ engagement with mobile devices is clearly evident, but it is by no means universal,” the company reports. “In other words, a large proportion of millennials still prefer the ‘human touch’ and want personal service when visiting restaurants, bars, coffee shops and hotels. Striking a balance to suit the needs of all guests will be critical.”
A restaurant’s current employees might be able to tell its operator how that balance might best be struck. When asked by the survey to evaluate their company’s use of technology, 32.5 percent of U.S employees agreed with the statement “I thought they made bad use of technology.”
That might be because most restaurants and hotels don’t bother to solicit feedback on technology from their front line millennial-aged employees. In the U.S., just 18.1 percent of hospitality businesses welcome this kind of input.
“Tapping the knowledge of millennial employees to better understand millennial guests is a no-brainer,” Oracle suggests. “Engage your staff and reap a host of other benefits, too: improved operations, better morale and less staff turnover. Everyone wants their voice to be heard, and millennials are no exception.”
Contact Bob Krummert: [email protected]
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