“For us to be able to have that data and be able to connect with our guests regardless if they choose to order on a third-party platform,” he added. “That’s one of the things we’re really excited about.” He said it would lead to “some really great marketing,” over time.
Garutti said Shake Shack knew the decision to pick a national partner was a critical call. It asked, “who’s got the best long-term revenue opportunity?”
But equally important, the brand wanted to know which setup delivered a quality guest experience. “Delivery is a hard business,” Garutti said. “Shake Shack’s food is hard to deliver and we need to do it really, really well.”
“The guest data and insights is a huge thing moving forward,” he said. “So, that's going to be new opportunity for us. And then really, the overall economics of the deal will lead to better economics for us over the long term, which everyone is battling right now in this part of the business.”
Garutti was asked during the call whether or not delivery is a more expensive channel than courting dine-in guests.
“Yes, the answer is yes,” Garutti said. Shake Shack has a commission in business off-site, naturally, plus there’s a significant paper cost to delivered goods.
“But in general,” he said, “look, we just want to find a balance of all the things that will drive long-term sales growth for this company and delivery is one of them. Sometimes, those come at a cost. Part of why we chose Grubhub in this new partnership will be to lessen that cost over the long term, and we thought we’re in a good place on that to help out as we look to the future.”
Considering throughput, Garutti said, “the proliferation of these additional ordering channels,” influences the company’s design strategy with new restaurants, as well as how it continues to tweak existing venues.
In the last few years, Shake Shack worked toward “split kitchens,” which allow it to deliver peak demand and handle digital mix. Garutti said the chain is now looking at pickup areas, shelving, and trying to make the courier’s job seamless. Also, helping ease app pickup orders.
“We're designing some restaurants that will really truly separate those areas,” he said. “So, next year, you'll see some Shack designs that will really have a completely separate section for the digital pickup from the in-house pickup because we really want to honor our guests who continue to come to Shake Shack. Obviously, the overwhelming majority of our guests remain people, who are looking for that great Shack community gathering experience, and we want them to have a great experience.”
Shake Shack will test different store iterations moving forward. All toward making sure it devises a digitally native restaurant that can be successful while also providing a stellar guest experience across multiple channels.
