Innovation and Guest Experience in Restaurants

Speaker 1 0:01

Welcome to another edition of Give an Ovation , the Restaurant Guest Experience podcast , where I talk to industry experts to get their strategies and tactics you can use to create a five-star guest experience . This podcast is sponsored by Ovation , a two-question SMS-based real-time guest feedback platform that helps restaurants measure and improve their guest experience . Learn more at ovationupcom . And today's guest is Derek Rosenbaum , and I am so excited to have him on because he is the president of an 80-year-old 30-location Groucho's Deli and they are just crushing it with innovation . Derek , welcome to the podcast . How are you , man ? I am great .

Speaker 2 0:40

Zach , I'm super stoked to be here . Always great to spend a few minutes with you .

Speaker 1 0:44

And I love the shirt . Look at that Sunday swagger Ovation branded . I don't know how you got that .

Speaker 2 0:50

Yeah , custom gift from a some guy wearing a pizza shirt .

Speaker 1 0:52

So I know , yeah , I'm wearing the sister shirt of it , also branded Ovation , Nice . Well , first of all , derek , you've been at Groucho's for like 20 years . You've been there for a long time . You've worked pretty much every angle at Groucho's . How do you look at ? There's two factors of innovation that are super impressive because you're really pushing the envelope , doing some incredible things . One , how do you do that with a brand that's 80 years old ? And two , how do you do that when you've been at the brand for so long it's being at a place for 20 years ? It's hard to see the warts from , just like the regular bumps that are part of the business . So , how do you differentiate ? There's two angles of innovation here that are pretty impressive . Right , how do you look at that ?

Speaker 2 1:44

I think it's twofold One . Personally , I'm a builder . That's what I do . There's some processes , teams , restaurants . I build . That's what I do . As far as the brand , we like to look at it , as we adapt , we don't change and I think , in order to compete , you have to stay relevant , especially digitally relevant . In order to do that , especially today , post COVID , during COVID and post COVID , I mean , you have to constantly be thinking about what's next and meeting the customers where they are , the guests , where they are , the channels they're in , whether it's third party , whether it's native , whatever the channel . We have to be there , we have to be able to service them in that channel and provide them the experience that they want at that given moment .

Speaker 1 2:29

And has there been a time that you looked at innovation that you really wanted to push it through , but it just didn't make it through the gauntlet to actual implementation ?

Speaker 2 2:39

Yeah , I'm a big , I like to prove things out completely . So everyone on my corporate team , except for maybe a few new team members , is a franchisee in some capacity , whether they're a managing member or they're an investor . So I think that brings a different perspective to our decision-making process , because we know the decisions we make A cost money . B do they generate better productivity , do they generate product and can we scale them ? Some products can't scale , especially in the tech world . There's a lot of overpromise , underdeliver . I tend to work the opposite way I want to underpromise and overdeliver . So we like to vet things all the way through in our units first , before we even give a tech platform an opportunity to even speak to our franchisees .

Speaker 1 3:31

Interesting . What's one of the solutions that maybe you tested out and you don't have to tell me the company name but maybe something that you guys tested out that you realized just wasn't moving the needle for you .

Speaker 2 3:45

You know , pre-covid we were kind of transitioning from that legacy POS world into this cloud-based or hybrid-based solutions and getting these technologies to talk to one another . It's always a challenge because in the tech world most people are like this it's his fault . No , it's his fault , yeah .

Speaker 1 4:07

It's like when I call DoorDash , when my order is wrong , I call the restaurant . The restaurant's like call DoorDash , I just call the restaurant . I'm like call Google , I don't care Right .

Speaker 2 4:15

Yeah , bye , I try not to let it get to the point I try to pre-vet most products before we even get to that point . I like to weed it out . I ask lots , you know this . I ask lots of questions and I make sure it's a good fit before we even start doing a pilot . If I can find the roadblock before we even implement , then I'm going to do that Interesting .

Speaker 1 4:40

What are some questions you think people should ask as they're vetting tech companies , are you ?

Speaker 2 4:46

open ? Do you play well with others ? Will you give me a sandbox ? Can I test this with my systems ? Does it integrate properly ? Does it talk together ? There's two different methodologies right now . So one is open and one is this closed loop model . I'm pro open , not pro closed loop . Closed loop definitely serves a purpose for certain people , not for us . It's really you get in a sales meeting , you go through some due diligence , you ask some questions and it's time to put the rubber to the road . And let me take the Ferrari out for a test drive and it performs the way you say it does , then it should be a problem , right ? But if you tell me you're not going to , let me test it before I sign a 12 month agreement , I'm out Like I'm done . It's not going to happen . I think the days of legacy systems where you're on the hook for three to five years or that's a long gone era , long gone era .

Speaker 1 5:38

And I just , personally , I don't understand it . We've always had Ovation believe that you should do month to month agreements . Now , granted , there could be some , you know , especially if we're building , like some , some custom work for someone , and , yeah , maybe there's an agreement there , but 99% of the time it's month to month because I want to , you know , I want to make sure that we're doing a good job , right , there's a reason why , if there's a huge development lift , yes , you need to be able to recoup some of those costs .

Speaker 2 6:01

But I think you're going to be much further down the due diligence path before you get to that point when you say , okay , I will commit to 12 months or whatever Like what happens if Netflix stops producing good content or stops getting good shows . I'm in .

Speaker 1 6:16

Or at least I sign out of my parents account , right , and I feel like we should be able to do that with software too . Like I don't want to be locked in . Why should I be locked in ? Like , if you're producing a good , if you have a good product , then great , I'll stay with you . And if it's not , then look , that's not my problem , and don't make it my problem by making me sign a three year agreement .

Speaker 2 6:39

Yeah , I'm looking for vendor partners . I'm not looking for somebody to just looking to grow their ARR for the next 12 months . I'm looking for long haul , genuine partners . Change resistance is very real . It's very natural , especially at the store level . So the more I can prevent that from happening and find the right partners that are open and we're willing to integrate . So if we changed out POS systems , we could plug in this partner or this partner or this partner . And that's kind of the approach we generally take up here .

Speaker 1 7:09

Love it . What do you think flipping the script to the other side of the counter ? What's the most important aspect of guest experience nowadays ?

Speaker 2 7:17

Ooh , that's a big question Finding the right balance and confluence of FIDGITAL right , so the FIDGITAL and the physical space and the digital space , because we're now swimming in all those channels all day long . And we were both at FAS Tech last week . A lot of the operators I talked to , I mean , whether it's first or third party , digital is 40% to 50% of revenue , now , right , so we have to be there . And then still maintaining those traditional roles of hospitality . So AI and machine learning are so popular now right , big hot buzzwords and we're using it every day in different platforms . But we still add HI to it , which is human intelligence and hospitality intelligence . If you don't have those , you can't set automation and just trust robots to run your systems , your processes , your reputation management . You can't do that . Right , you still have to bring the voice of your brand , the voice of your people . You still have to deliver hospitality .

Speaker 1 8:25

Yes , and I think that is such a good concept we talk about all the time in the podcast is you can't take humans out of hospitality Now . You can augment them , you can empower them , you can supercharge them , but you can't remove them .

Speaker 2 8:43

And you let it do the automated , mundane tasks that are repetitive , right .

Speaker 1 8:49

Yes , yep , exactly , and make sure that the things that humans should do , like looking at the whites of the eyes or communicating back and forth , have humans do that . So I love that . In terms of tactics that you've used to improve the guest experience , any insights on that ?

Speaker 2 9:12

I mean we're big believers in reputation management , especially in the digital space . So I mean we're using tools like you . We use tools like Marky . We respond to every piece of feedback , whether it's native to us , coming from you , direct consumer feedback , or whether it's third party for online feedback from Google , yelp . You know , we want to hear from our customers , we want to figure out ways to remove the frictions , we want to identify pain points in our operations and be able to correct those . And you know , previously you really couldn't , you didn't have any visibility to that per say , like you know , because I mean I'm old school , like if I have a bad experience , I'm not going to go online and leave you a one store review , I'm just not coming back . Right , exactly , the game's changed , you know . Now everyone has a narcissistic platform at their fingertips and then go say whatever they want to say good , bad or indifferent .

Speaker 2 10:02

And so we invite our guests to leave lots of feedback . And then , as far as on the ground training , you know we're working with we're in the final stages of relaunching OPUS with our teams to get down and teach at the level that today's workforce is learning

Customer Engagement in Hospitality

Speaker 2 10:18

at . You know it's different than the way I learned and , just like you said , teaching eye to eye contact and putting your phone down and engaging with the customers , it's simple things smiling , saying hello , it's not complicated , right , we're not looking to make relationships and along , before social media and all that . I've always called it the art of the perceived relationship , because that's what it is Like . When I used to run my franchise and I ran , sat at that cash register when we were still 80% cash and 20% credit cards , like if someone came in and they had a scallop in their face , my whole goal was to make you smile or laugh before you left , because that's what stays with the customer , right , the food's part of it , but all of it makes up the experience the bathrooms , the service , the food , just the general way you make you feel Like .

Speaker 2 11:04

Recently I went to a restaurant with my family in new place in town and like we walked in . It was just this weird vibe dude , like you could tell the staff didn't want to be there . I mean , the space was beautiful , the food was good , it was just weird . And you know , teaching and still in that culture . Yes , I sell sandwiches for a living . So it is not fine dining , it's not . You know , it's a little different , but it's the principles of hospitality . The same . No , whether you're selling an $80 stake or a $10 sandwich .

Speaker 1 11:33

Absolutely , and I feel like , at the end of the day . I learned this in advertising in New York when I worked in the agency there is that everything communicates , and do you know what ? Every single thing , from the bathrooms to the way that you wrap the packaging , to the way that you hand it to the guests , to the way that you interact with them , to the ease of online ordering , to how it's delivered . Do you know ? All of that communicates , derek ? It's communicating whether or not every single thing is binary , yes or no . Does this thing prove that that restaurant cares about me ?

Speaker 2 12:05

It all goes down to that one word here , and that's what's missing today , I think , in hospitality , especially in the QSR space , because it's a different animal right , it's a very different animal .

Speaker 1 12:23

I totally agree with that and love that concept . And one of the things you know you use some great technology , marquis . I know you use Bickey Ovation , opus . You use some great tech there . I'd love to just ask you real quickly how has Ovation been helpful for you and Groucho's ?

Speaker 2 12:40

So many levels . So , yeah , we can provide instant . I mean so when we turned on ovation , it was , I don't know , it was on a Friday in November of last year . We turned on a Friday afternoon and my team's like , well , let's go ahead and build a can response . I'm like no , we're not doing anything . I want to let it run all weekend long .

Speaker 2 12:58

And when I see what we're dealing with right , I want to see the feedback that comes back . And it was so apparent . The immediate need right was like when a customer I mean , we've had we've had our own native online ordering and application ordering since late 2014 . So we were way ahead of the game on that , and so we've had a strong base of that for a long time . And the number one complaint and it still is today is food's not ready when I pick my designated pickup time . And I'm like this expectation has been set If you're too busy , we have the tools to throttle on the fly . Use them right .

Speaker 2 13:34

So that's one component is the learning and the insights and aggregating those . We use it operationally daily on the insights level to . We have a benchmark right across all the stores and we use the heat map and your insights tool to immediately identify problematic stores . And now problems don't go 30 or 45 days , I mean , we can see patterns within days . If you know a manager is if things are decompensating at a location , right , we can see that pretty quickly . And then so the insights are amazing , the feedback is amazing , and what we've really learned is that guests just want to be heard . You don't necessarily have to give them a discount , you don't necessarily have to cop , whatever the problem was . Yes , we do . If we really screwed the pooch , we're going to take care of you on that level . But and we're all about service recovery and the data shows you that if you provide the service recovery , you have a more than likely you're going to have a loyal guest for a very long time , right ?

Speaker 2 14:32

So those are the two biggest ways we use the tool . But we use it at the store level and we definitely use it at the corporate level all day long and our operations team between Marquis on the reputation side and you is like that's our source of truth . My field inspector , when he goes , before he walks into a location he pulls up the marquee , he looks at all the insights , he looks at the feedback , does the same thing with Marquis , while inspections are generally the same . That gives him a target path to go hone in on and try to identify the root cause of the problem . I mean , yes , you can put band-aids on symptoms , but you really got to get down and figure out what is the root cause of the problem and how do we take corrective action .

Speaker 1 15:11

Well , that's so awesome . I love to hear people using the system to the full extent . Right that you're seeing both the guest voice , helping them feel heard by responding , making that easy for the guest to give feedback , easy for you to respond . But then I love that you're getting to the root issue , because it's not just about solving it for the one person , it's about solving it for the other 26 people who had the same issue that didn't share it . And by fixing the root you're preventing that negative experience in the future .

Speaker 2 15:40

Now , the last few weeks , our director of operations has been out on a family matter , so I've kind of been overseeing the support component of our operations , which actually , for me , I like to do a couple of times a year because it's enlightening and it gives me a different viewpoint , like , yes , I look at it in a roll up forms and this , but doing it daily like it gives you a different perspective , right , and so , like I sent out a chain of email yesterday , an internal email to the whole chain , I was like these are the repetitive things we're seeing over and over and over . We have tools and mechanisms to address all of these . I mean , what we've found is , generally speaking , operators want to operate . Right , it's our job to go out and find the tools to empower them , to educate them , to do their jobs , and I mean , ultimately , that's what we try to do .

Speaker 1 16:26

Love that . Who's someone , Derek , that deserves an ovation in the restaurant industry . Who's someone that we should be following ?

Speaker 2 16:32

Wow , that's so tough because I'm like in the middle between operations and tech . I live in this weird world and I'm gonna choose Rev Ciencio because he is an ambassador . I mean that dude is awesome , like he's connects restaurants with the right people . He connects technologies with the right customers . He genuinely cares about this industry as a whole .

Speaker 1 16:57

Yeah , and I love Rev and he's not only does he care , but he's a good time man . I love hanging out with him . We do it at trade shows . We hang out all the time at trade shows . We hang out whenever I go to Jersey or New York , whenever he comes to Utah . So , anyway , he's a good time man . And Derek , where can people go to learn more about grouchos ? Where can they go to get a bite ? Where can they go to learn more about Derek ?

Speaker 2 17:20

Grouchoscom is probably the easiest place to start right . You can find me on LinkedIn . It's about the only place you'll find me socially . I'm still a little old school on that front . Yeah , I mean , grouchoscom is the greatest place to find those locations . Us contact us , anything around that will get you to where you need to go .

Speaker 1 17:38

Awesome . Well , derek , for not just being a thought leader , but for also being an action

Appreciation and Sponsorship by Ovation

Speaker 1 17:43

leader . Today's Ovation goes to you . Appreciate you spending some time with us and giving Ovation .

Speaker 2 17:48

Thank you , sir . It was awesome to see you . Just saw you last week , but anytime I can spend some time with the Zotes , I'm in .

Speaker 1 17:54

Hey man , thanks for joining us today . If you liked this episode , leave us a review on Apple Podcast or your favorite place to listen . We're all about feedback here . Again , this episode was sponsored by Ovation , a two-question , sms-based actionable guest feedback platform built for multi-unit restaurants . If you'd like to learn how we can help you measure and create a better guest experience , visit us at ovationupcom .