In times of tumultuous change in the restaurant industry, brands can no longer afford to work with firms that offer single solutions to the multitude of challenges and opportunities. Instead, they need to pick partners who understand the intersection of four critical factors—data, communications, technology, and organizational execution—and can develop and implement programs that effect transformation at scale.
In short, brands need a holistic approach—“comprehension of the parts of something as intimately interconnected and explicable only by reference to the whole.”
More than 20 years ago, King-Casey developed a proprietary research & development tool that takes into account the four critical factors noted above. COZI, which stands for Customer Operating Zone Improvement, is an analytic, data-driven approach. It is based on a fundamental truth that the most successful restaurants recognize, namely that stores are not just big-branded boxes. Each store is actually a collection of many individual “operating zones” in which “customers” behave differently. Their needs and expectations are different. By identifying these zones and understanding how customers behave in each one, a brand can develop zone-specific communications and merchandising strategies and other improvements that respond directly to customer needs and make the customer experience faster, easier and more enjoyable.
Let’s look at how COZI addresses data, communications, technology, and organizational execution, and some of the restaurants that have adopted it successfully.
Zone Assessment is Step One. Begin by identifying your different zones. Using a quick-service or fast-casual restaurant as a template, they usually include (sequentially):
Then determine how customers act and behave in each of these zones and the amount of time they spend there. Probe customer needs, expectations and attitudes. Do they understand your communications? Do you have the right message for the right zone? What problems do customers have?
Clearly, data plays the central role in answering these questions. It can come from a broad variety of sources: operations data that measures through-put and the time spent in each zone, product sales data that shows preferences and related costs, employee data that highlights labor intensiveness. A combination of qualitative and quantitative data is ideal. Focus groups, in-depth interviews and video behavioral tracking studies can provide critical customer insights. There should be no shortcuts here. The goal is to establish a statistical foundation for the customer experience.
That’s what SABMiller did in Colombia when it wanted to better emotionally connect with customers in its largest sub-channel—“tiendas sociales”—independently owned bodegas in neighborhoods throughout Bogota. Researchers met customers at their homes and then spent evenings with them observing buying and consumption behavior. One of the “aha” moments was the importance of the first order. It usually dictates what they drink the rest of the night. Learnings like these informed an SABMiller program aimed at becoming the beer brand of choice for the first order and encouraging customers to trade up to more profitable premium beer brands.
Zone Strategy is Step Two. Start by determining the business objective and strategy for each zone. They may differ from zone to zone but should be grounded in data developed during Zone Assessment. A critical question at this point is: how will we measure success?
With data-based objectives set, you move to communications. What message must you communicate to achieve your objectives? Content should reflect the data and be zone-appropriate, e.g., no detailed messages in the entry zone. Del Taco, which continued to grow in 2017 as many quick-serves stumbled, used COZI to optimize its Order Zone. The assessment process included more than 300 consumer interviews and data analytics that identified opportunities for growth in menu item prioritization. As a result, the company revised its menu strategy generally and specifically its communications messaging and menuboard architecture. It successfully encouraged higher-priced premium products without losing customers who loved “Buck and Under” specials.
Zone Strategy is more than just messaging—how do you display it? Determine which physical elements work best in each zone, choosing from among posters, menuboards, window decals, etc. Note that technology has geometrically expanded possibilities here, as we discuss below. Finally, you come to “design”—the creation of graphic images, typography, branding etc.—or what the communication will look like. Don’t fall into the trap of starting with this step. It is the logical end-product of a thoughtful strategy process.
The Starbucks’ drive-thru provides a dramatic example of how technology can upgrade visual presentation. A COZI analysis determined that the company was missing an opportunity by not having its drive thrus reflect in-store excitement, particularly the vibrant personalities of the “baristas.” In response, Starbucks created video baristas who now give drive-thru customers a personal taste of the total Starbucks experience.
Now it’s time for step three—Zone Implementation, where organizational execution comes into play. You know your goals, what you want to say and how you’re going to say it. This is the time to “road test” and finalize your zone merchandising strategy and communications. Select several stores that will serve as pilots for the new initiative. Monitor results during the test period against the criteria and measures you initially developed in the Zone Strategy process. The success of this road test will help convince franchisees that your new direction is worth the time, effort and investment.
Improvement & Roll-Out, Step Four, continues the emphasis on organizational execution. Continue to monitor key measures of success to identify opportunities for improvement. What’s working? What’s not? Why? Feed these “lessons learned” back into the planning process, as you roll-out your enhanced strategy to other stores in the system.
The COZI process depends on data and demands intellectual rigor. That’s why it ends itself so well to scale. Starbucks’ decision to upgrade its drive thrus became the largest capital program in the company’s history. For those who follow the guidelines, the upside is enormous.
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