- December 18, 2017
- Posted by: Ryan Strategic Advisory
- Category: Industry commentary
For BPO providers, finding new sector niches is rare. Over the past decade, so many verticals have been prospected that there are not many left to tap. However, some emerging trends show that the restaurant component of the hospitality industry may be just the opportunity that so many BPO executives have been looking for. With rapid spending growth across demand markets, outsourcers need to figure out how best to take advantage of the bar and restaurant segment, positioning both front-line and back-end processes as a way to grow revenues.
It is fascinating how the culture around eating at restaurants has changed. Eating out was a rare treat for families just a generation ago; today it is a way of life in many countries. Consider that in the US eating at restaurants has surpassed buying food at grocery stores for the first time. In Great Britain, a recent PwC study estimates that nearly one-quarter of the population eats out at least once a week, up from seven percent in 1989. Canadians appear to be upping their spend at eating establishments more than ever, a trend that is also evident in Australia. For outsourcing executives eager to profit from a new revenue stream, servicing restaurants has potential.
But in order to take advantage of this culinary opportunity, BPO providers need to be smart in how to attack the relevant segments. Obviously, the local bistro is unlikely to require the functionality or economies of scale that an outsourcer brings to the table anytime soon. However, this will not be the case for restaurant chains, which still account for a sizable portion of the hospitality sector. Many of these businesses have been facing pressure on their own revenues in recent years, and need to drive end-user loyalty. Forward-looking outsourcers should be targeting these chains with a combination of customer experience delivery capabilities that drive efficiencies, encourage repeat business and also gather consumer intelligence.
Equally, an emerging part of the restaurant opportunity is online ordering, a segment of hospitality that continues to surge. Applications including UberEats, JustEat and GrubHub are no longer the exclusive domain of millennial hipsters, but can be found on the smartphones of practically all demographics in western markets. Where many of these online food portals fall down is in managing their customer experience delivery; as ‘born-digital’ enterprises, the concept of CRM as a differentiator for many of these organizations has not been a primary investment consideration. Thus, to grow loyal users in an increasingly crowded online ordering industry, these portals need to have outsourcers position end-to-end solutions that encompass cutting edge channel technology and excellence in execution of interactions with end-users.
Moving into 2018, outsourcers need to be creative in finding new vertical opportunities. It is clear that with the growth of restaurant spend in major demand markets, developing appropriate solutions for this sub-vertical makes a great deal of sense. BPO executives should look to act quickly, as the nature of the food services sector requiring customer experience support is high volume and low margin. Getting in the restaurant door early to secure contracts with prospects in the target segments should be a provider priority.