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Fri 20th Mar 2020 - Friday Opinion
Subjects: Adapting to the outbreak, new channels step up, happy to help, and contact-less
Authors: James Hacon, Dominic Allport, Ann Elliott and Glynn Davis 

Adapting to the outbreak by James Hacon

The world has turned upside down. Italy is still in lock-down while France has entered it, parts of the US have banned restaurants and bars from opening, there’s a ban of ten or more people gathering in Denmark, Spain has closed all its hotels and in the UK the government has advised the public to socially distance and discouraged visits to bars and restaurants.

Steal with pride, share with joy!
We’ve seen incredible responses from operators to try to maintain as much of their business as possible, keep their teams employed and support communities. I’d like to feature just some of the businesses that have become shining lights of hope. Steal whatever inspiration you can from and share ideas!

Takeaway and delivery
The most obvious opportunity for most has been to turn to delivery. McDonald’s is perhaps the biggest player to have announced a major move to drive-thru and takeaway only, closing its in-store seating – something many other quick service and to-go brands have also done.

For businesses that are usually full service or experience focused, this is a less natural move. Those brands that do will need to be extra creative to cut through the white noise of communication. Many brands are doing just that.

– Indian restaurant brand Dishoom launched its menu on delivery platforms accompanied by a teaser about its legendary bacon and egg naan 

– Michelin-starred chef Sasu Laukkonen has switched his 20-cover restaurant, Ora in Helsinki, into a sushi production facility

– Lucy Pedder and Natasha Cooke, founders of Lupins restaurant in London, have set up delivery service Women On Wheels offering healthy food delivered by “girls whizzing around the city on mopeds”

– Damian Wawrzyniak, who runs House of Feasts restaurant near Peterborough, is offering a special menu for takeaway and delivery and encouraging guests to order directly from his website or Facebook page

– Danish brand Sticks ‘n’ Sushi is offering a “unity” menu, with its best-priced family meals available for collection

– 25Hours Hotels, mainly based in German-speaking countries, has opened the majority of its restaurants for takeaway

– Mala Project has released a “quarantine food” offer to “spice up New Yorkers’ pantries”. It includes dishes in jars for delivery

– In Denmark, Brace restaurant went viral as chef Nicola Fanetti personally delivered meals to homes

– Whisper Sister, a speakeasy in Tallinn, Estonia, has pre-batched cocktails to take away 

– Oakman Inns and Restaurants activated takeaway of its menu quickly and will offer delivery, with a focus on Mother’s Day

– Coffeeology in Hammersmith installed a counter to trade street-side

– Brewdog was fast to react with its “drive-thru”, with food and beer ordered on its app brought to your car

– We have followed a similar lead at our venture, I am Doner, offering drive-thru at our Harrogate store and removing seats from our other stores to go takeaway only

We understand delivery and takeaway aggregators are working hard to get new businesses on to their platforms, while our technology partner, Vita Mojo, is working to extend its order and collect service to include steps to support client delivery.

For those looking for a free direct online platform in the UK, we have worked with Gloria Food, which offers a good entry-level system that can be implemented quickly. 

What we’re learning here – and from so many of the stories published by Propel this week – is restaurants, pubs and bars of all sizes are adapting to takeaway and delivery. In the rush to extend their business models, the winners ensure they don’t become just another brand that delivers but communicate their message to loyal guests in a way that gets them noticed.

Gift vouchers
Many operators’ first reaction was to encourage guests to buy gift vouchers – a move that has spread rapidly. While we’ve seen great stories of generous guests buying big vouchers and the move appears to be working in the US, the majority of operators we spoke to in Europe have had limited success as guests tighten their spending.

– Renowned bar entrepreneur Ryan Chetiyawardana, aka Mr Lyan, is encouraging gift vouchers for his venues online. Lyan Cub is promoting a special voucher that includes set food and drinks for two plus an extra round of drinks and a cheese course

– New York restaurant publicists Steven Hall and Helen Patrikis have created the Dining Bond Initiative to bring in immediate cash in exchange for future restaurant purchases. Diners can buy gift certificates sold at a 25% discount to be redeemed later

– Harts Group, which owns Quo Vadis, El Pastor, Casa Pastor and Barrafina in London, are offering guests a £1,000 voucher that will be worth £1,250

– Modern Indian restaurant group Kricket is offering guests who buy their vouchers 20% extra when they cash them in, valid until the end of the year

If you’re keen to give gift vouchers a go, there are plenty of providers. One of our partners, RSVP, has turned its integrated gift voucher system into a SAAS product. 

Supporting teams
Many executives are having to make the miserable decision to lay-off staff. While countries such as Denmark, France and Ireland have announced schemes to support employees, others have yet to do so. In the UK, we await details of a support package from the chancellor today. In addition, the industry has developed a number of welcome initiatives. 

– Only A Pavement Away, the charity that supports homeless and vulnerable people into jobs in hospitality, has launched a pay gap fund 

– James Brown and the team at TipJar have launched the Hospitality Workers Emergency Fund in partnership with Hospitality Action, with 100% of donations going direct to hospitality workers in need 

– Hospitality icon Danny Meyer is creating a relief fund for Union Square Hospitality Group staff, seeding the effort by contributing his entire salary and a meaningful executive pay cut 

Proactive communication
In times of crisis, leaders are made and reputations destroyed. We’ve seen some incredible proactive communication we can learn from. 

– Peter Borg-Neal, chief executive of Oakman Inns and Restaurants, shared a video with his teams in which he was calm, reassuring and, most of all, set out a clear plan. In a multi-site business, video is a great way to communicate as it’s more personal and easier to trust than a letter

– Pret A Manger chief executive Pano Christou has been at the forefront of the company’s communication, personally signing the regular messages sent out. For a business of Pret’s size, this feels impressive and gives customers a figure they can trust.

– On closing their restaurants, Hawksmoor founders Will Beckett and Huw Gott publicly shared a letter on their social media channels. It was written with grace and decorum and detailed the challenge and their response, which showed them to be genuine and in touch

It’s important to remember that while this is a terrible time for our economy and sector, it’s primarily a public health emergency with healthcare professionals putting in even more hours while risking their lives. Several brands are supporting them during this time.

– McDonald’s is offering all health, emergency and council workers free hot and cold drinks 

– Domino’s is hosting Free Pizza Friday this week for all NHS staff

– Pret is offering all front-line NHS staff free tea and coffee, with 50% off other items in-store

– Brewdog and many other companies are using facilities to produce free hand sanitisers 

– Feya Cafe in London is giving NHS workers free tea, coffee or a meal while surplus food is sent to food banks

Keep reading Propel for the latest industry initiatives.
James Hacon, is chief executive of Think Hospitality Group and has written this article with its team of partners, associates and consultants 

New channels step up by Dominic Allport

There was a 20% increase in food deliveries in China in the last ten days of January, when the Chinese government began to implement restrictions. This affected the various foodservice channels in different ways. As expected, full-service restaurants, coffee bars and cafes were hardest hit. The quick service restaurant channel was relatively stable because selected outlets were able to migrate quickly to delivery.

We know in China that consumers continued to support foodservice outlets they knew well, while strong demand for food and beverages that could be consumed off-premises remained. Any outlet offering delivery, drive-thru or takeaway by click and collect, along with outlets providing pre-packaged food and drinks or vending machines, can mitigate some of the effects of the inevitable business downturn prompted by the coronavirus outbreak.

Pubs and restaurants are typically places in which people eat in close proximity, leading to hygiene concerns regarding table surfaces or pre-prepared food on display in a buffet format. Fortunately, more than three-fifths (62%) of Britain’s foodservice consumption happens outside the premises in which it is ordered.

The already burgeoning delivery channel is ideally suited to government advice to minimise person-to-person contact. Since 2017, delivery visits have grown almost 19% or nearly 100 times faster than the 0.2% visits growth seen in the overall British out-of-home (OOH) foodservice industry. Delivery visits now account for 8% of the total OOH or eat-out foodservice market in Britain and 9% of spend. Digital delivery visits – where consumers order by app or online – account for almost two-thirds (64%) of all delivery visits, 24 percentage points higher than 2017.

With the UK government advising us to avoid pubs and restaurants, consumers will understandably turn to foodservice channels that allow them to minimise human contact. Delivery, drive-thru and click and collect provide an opportunity to continue ordering-in food and drinks. These channels can provide much-needed business to some of Britain’s hard-pressed foodservice operators.

Drive-thru has increased its footprint in foodservice significantly and there are almost 2,000 drive-thrus in Britain. In 2019, there were 508 million drive-thru visits with spend of £2.5bn, up almost 19% since 2017, with those visits making up nearly 5% of the entire British foodservice industry. Coffee operators such as Costa Coffee and Starbucks have also invested in drive-thru, with coffee servings at drive-thrus growing 12% since the end of 2017.

Click and collect has grown 28% in visit terms since 2017, while spend hit £929m in 2019. Consumers can also use vending machines or buy pre-packaged items from a variety of outlets. 
Dominic Allport is insights director (foodservice) at The NPD Group

Happy to help by Ann Elliott

I didn’t really want to write this article. My opinion isn’t relevant or valid in current circumstances. Operators have too much on their plates at the moment and don’t want to be given advice by marketers when there’s nothing to market and no-one to market to. Their issues are far larger.

As Mark Ritson said in his Marketing Week article this week: “The first lesson of the coronavirus crisis is to shut up and let the experts guide us. I’m well aware at this point that expertise from the medical fraternity or our so-called political leaders seems in short supply. But that doesn’t justify marketers feeling they have some god given right to share their thoughts, solutions or recommendations. We are marketers – and most of us aren’t even any good at that. Let’s leave the epidemiology to the professionals.”

UKHospitality, however, has been a great source of information. Chief executive Kate Nicholls is doing an amazing job of bringing the sector’s needs to government. Jonathan Downey is worth following too for his take on the situation. Wireless Social has been publishing some interesting (but depressing) stats that give an indication of the broader picture.

Simon Kaye, an adviser at East Coast Concepts and a non-executive director of Morso, emailed an interesting summary of relevant information yesterday regarding a response checklist for hospitality businesses, while Andrew Ball, of haysmacintyre, has also been a good source of information.

I’ve set up a number of WhatsApp groups – two for operator managing directors and one each for operator marketing directors and suppliers. Let me know if you would like to be included. Anthony Knight has also set up a WhatsApp group for marketing directors and I’m sure there are loads more. You can get WhatsApp group overload, of course, but I’ve found them incredibly helpful and supportive during the past two weeks. 

Some key themes have emerged from them.

– Many operators saw closing sites as morally inevitable once Boris advised the public not to go to pubs and bars. How could they justify asking their teams to serve in establishments the public had been told not to visit? 

– Closure has also been the right and responsible thing to do for a huge number of operators to stop the virus’ spread. Closure has been a response to comments such as this in Mail Online this week: “Britain’s chief scientific adviser has begged young people to stop going to the pub and claims the UK won’t beat coronavirus if they keep flouting home-confinement rules. Sir Patrick Vallance slammed young people’s complacency about the virus and said ‘mixing’ in bars and restaurants ‘needs to stop’ because it’s allowing the disease run rampant. He warned a coronavirus vaccine was at least six months away and the only way the outbreak could be delayed until then was if everyone stuck to the government’s tough new social restrictions. His plea came after Britons were filmed partying into the early hours in packed pubs and nightclubs around the country, defying ministers.”

– Some operators, of course, want to stay open beyond Mother’s Day for the cash it will generate but may consider closing after that

– Many, but not all, teams seem to have been made redundant rather than being asked to work without pay for an unknown period of time once sites have closed. Some businesses are paying skeleton staff and key team members they want to retain (for the moment). A number of boards and directors have reduced their salaries to minimum-wage level in an attempt to minimise costs at “head office” 

– Most are looking to cut costs and are talking to their banks, landlords, HMRC and suppliers. The latter can’t be excluded from government discussions, though many recognise they aren’t a priority for operators and come at the pointy end of the scale 

– Delivery and takeaway-only options are being considered but these aren’t always practical or possible for many sites where the dine-in operation has been closed

– There’s strong belief the government isn’t doing enough for people in the sector who are about to lose their jobs, especially zero-hours contractors, minimum-wage earners or the working poor. They don’t have deep pockets, years of savings or easy access to help. Who’s going to rescue them and stop them going under? These are the people who are “only a pavement away”.

– I’ve also seen an enormous focus from the sector in helping their communities. This includes one managing director who works with isolated elderly people asking for additional food supplies, others wanting to donate to food banks and some asking how they can get food to those who are self-isolating, ill or can’t get out. I have found the altruism in this sector breathtaking.

If anyone would like help or advice in the coming months, let me know. I’m happy to work pro bono to help anyone who needs it. I don’t know a lot about coronavirus but I do know a bit about this sector – and I’m happy to help.
Ann Elliott is chief executive of Elliotts, the leading integrated marketing agency in the hospitality and leisure sector –

Contact-less by Glynn Davis

Drive-thrus haven’t played a particularly big part in my life – perhaps because I’ve never owned a car even though I passed my driving test decades ago – but it’s clear they have become increasingly popular in the UK since they crossed the pond.

Drive-thrus are a mainstay of automobile-loving, fast food-guzzling American society. Their place in the country’s psyche will be further cemented after US president Donald Trump asked the country’s major restaurant chains, including Domino’s, Subway, Wendy’s and McDonald’s, to keep their drive-thrus open while closing seated areas.

McDonald’s is adopting a similar strategy in the UK and Ireland by keeping its drive-thrus open while removing the dine-in option. The company is also providing takeaway options from within its stores or via Just Eat and UberEats. The objective is to cut interactions between people to a minimum during the order, pay and consume stages.

A growing number of operators including Pret A Manger, Dishoom and Grind are also closing dine-in propositions and switching to a combination of takeaway, click and collect, and home delivery. 

Such a process-driven scenario sits incredibly well with McDonald’s as it has been working hard in recent years to remove points of interaction – also known as friction – from its restaurants so it can process orders more efficiently and ultimately make its business more cost effective. 

An integral part of this has been the introduction of kiosks into its outlets, which will play a major part in servicing customers during the coronavirus crisis. Kiosks reduce interactions with serving staff including the often clunky payment element, which has become one of the worrying aspects for many businesses as physical cash is seen as a conduit for spreading the virus. The solution for many businesses in recent days has been to ban or at least discourage its use.

Even before the virus hit our lives, kiosks were accounting for serious levels of McDonald’s sales. Its restaurants in Roadchef motorway service stations generate a hefty 60% of sales. Roadchef chief executive Mark Fox has said the only people who don’t use them are younger people who have no choice but to use cash because they don’t own a payment card.

The eradication of cash – and the onerous charges involved in its handling – haven’t been the only upside to McDonald’s installation of kiosks in its restaurants. They are a terrific generator of extra sales and Fox points to kiosk-based breakfast orders, where up to 25% of customers upgrade their regular menu item – often the additions are so hefty the combination doesn’t fit in the regular paper wrapper! This compares with a lesser 10% to 15% of upgrades at the counters.

In the UK we can’t begin to comprehend the long-term ramifications from coronavirus but, with kiosks and drive-thrus playing an increasingly important role in the UK’s foodservice industry during the crisis, we could come out the other end of this with a drop in social interactions reduced and delivery even more ingrained. We could, of course, go completely the other way and revel in a return to embracing physical interaction! 
Glynn Davis is a leading commentator on retail trends

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