Editor’s Note: In September we announced that Skift was expanding into food and drink with the addition of the Chefs+Tech weekly newsletter.
We see this as a natural expansion of the Skift umbrella, bringing the big picture view on the future of dining out, being fanatically focused on the guest experience, and at the intersection of marketing and tech.
Interested in more stories like this? Subscribe to Chefs+Tech Newsletter to stay up-to-date on the business of dining out.
Recommendations, Chatbots, and OpenTable in Facebook Messenger
At its F8 conference Tuesday, Facebook announced several business-focused updates to its Messenger app. Facebook estimates 48 million businesses have enabled Messenger to communicate directly with new, potential, and existing customers. New Messenger functionality announced at F8 includes a directory, spotlighting popular and local businesses, bots, and, of course, restaurants.
I consider the terms “bot” or even “chatbot” a little off-putting; they sound way too techy and not nearly hospitable enough for the hospitality industry. Instead, think: businesses can automate certain conversations — location, hours, directions, menu information — and simulate a human conversation, increasing engagement and, presumably, customer satisfaction. Last September, Pizza Hut and TGI Friday’s got in on the bot action; expect a lot more restaurants to jump on this soon. As we noted in September, bot functionality starts off a bit limited (in this case, information about hours and specials.) But because users are asking these bots questions, companies can quickly see exactly what consumers are looking for and program that specific functionality, making the chatbot a lot smarter and more useful. Restaurants and other businesses can also enable a feature called Smart Replies, which Engadget calls “a way to enable automated answers to frequently asked questions.”
Also included in the announcement: the ability to chat with a group and a bot. Most notably, users can make restaurant reservations directly in Facebook Messenger using a new OpenTable bot without leaving a Messenger conversation or launching a separate app. Coming soon: smart integration with delivery.com, including recommendations, ensuring we can continue to get exactly what we want exactly when we want it, now with fewer clicks.
No One Talks About the Real Food Business
Food and restaurants are having an inarguable moment, with more attention and excitement around the space every day. Understandably, we get caught up in the glamour and excitement of new restaurant openings, big-name chefs, food television, must-eat lists, and restaurant recommendations from every corner of the planet. Less talked about is the actual economics behind the business — i.e., how do these businesses stay in business amid financial challenges and legal regulations and red tape?
To understand the industry is to understand all its workings, and three recent stories paint an interesting picture of the business today. The Boston Globe has a piece explaining how chef-owners actually make a living in Boston (it’s tough.) The New York Times profiles a day in the life of a street food vendor, from wake up to food sourcing to recipes to pricing strategy. And a news story out of Bangkok reports a major change to tourism in the city as city officials crack down on street food; those famous sidewalk stalls had to pack up their tables and cease operations by April 17. (Mobile food carts are still allowed in certain locations.)
All three stories do a good job of reflecting the food-culture ties we’ve become so familiar with, but also detail the serious challenges and impediments associated with running these businesses. Food cart licenses in New York are hard to come by and sold at a crazy markup (the profiled vendor paid $25,000 to take over a license that cost the original holder just $200). In Boston, occupancy costs for restaurants in prime locations can run tens of thousands of dollars a month, and that’s before shelling out for food, labor, decor, utilities, and, maybe, hopefully paying yourself a salary as a chef-owner. And in Bangkok, the food vendor crackdown is literally robbing the city of a part of its soul (and some real tourist cash, too). All three pieces are worth a read to understand a little more about the businesses that have become cultural centerpieces.
Snapchat’s Latest Ad Product Is Good for Business
As stakes increase and competitions stiffens for advertising dollars on social media, Snapchat is set to offer retailers data about whether or not an ad campaign actually drives users to a physical location. Snapchat has been testing the product, called Snap to Store, since last year, according to the Wall Street Journal.
It works like this: restaurants (or any business, really) purchase a sponsored geofilter (one of those image overlays snapchat has become known for). A person in the restaurant uses that geofilter, posting a story or sending a snap to friends. Then, the app tracks friends who saw the geofilter and visited the restaurant — and it also tracks friends who didn’t see the geofilter and visited the restaurant. Put those statistics side-by-side, and the advertiser gets a picture of the ad’s effectiveness. It’s worth noting Snapchat isn’t tracking your location unless the app is open — but users open the app an average of 18 times daily, so it’s a bet a lot of restaurant chains would likely consider strong. It’s especially strong when you consider 80 percent of Snapchat users open the app while at a restaurant. (Wendy’s tested this functionality last year, and found one sponsored geofilter drove 42,000 people to a Wendy’s location within seven days. Solid.)
Unhealthy Obsessions on Social Media
In case you need something else to worry about, according to the National Osteoporosis Society, “clean eating trends” that have gained popularity thanks to social media might be causing serious problems for young people. The problem: these often restrictive diets eliminate major food groups, setting the stage for future health issues. When people see these fad diets touted on social media, they often join in without seeking expert facts or advice. This isn’t a brand new problem, according to Food & Wine, but it is a tech-driven problem: health bloggers and other non-accredited health websites extol potentially unhealthy fad diets and detoxes that can do real damage.
- Kimbal Musk, brother of Elon, redefines farming with technology in Brooklyn — Backchannel
- A look (finally!) at Made Nice, the new fast-casual spot from the team behind the world’s best restaurant — Eater
- Whole Foods may have mainstreamed “organic,” but when it comes to purchasing, customers always prefer the cheaper option — Quartz
- One group is aiming to make Chicago the “Silicon Valley” of the food industry — Chicago Tribune
- A new ratings system measures restaurant sustainability — FoodTank