Insights
After outdoor hospitality was able to reopen on the 12th April, operators reported that their early days were successful, yet challenging. With more venues opening every week, the industry is gearing up to the next big step on the Government Roadmap, which is, of course, allowing hospitality to reopen indoors as early as 17th May.
With consumer demand continuingly high for hospitality experiences, and limited availability for venues, it's important to find tactics to manage demand without creating friction. We recently surveyed our panel of consumers to help alleviate some of those pressures.
Reinvigorating staff from a long furlough slumber is seen as a key challenge for many operators across the sector. Front of house teams will be expected to provide the usual friendly, efficient, and effortless service, despite motivation being at an all-time low - this has been observed across all industries - and it will be incredibly difficult for staff to ‘snap’ back into those roles.
However, operators must succeed in getting teams back to their best selves before pulling that very first pint, because results from our latest consumer survey show - customers may be less forgiving than you’d think. In those early days after re-opening, consumer expectations will be highest, and there is a big risk of disappointing loyal customers who have waited so long for a visit to their favourite local, if the service is less than perfect.
Despite 68% saying they would be more forgiving of minor service blunders (e.g. a wrong order or delayed service) because of the pandemic, almost a third of the respondents were unwilling to give any leeway at all. We asked them to rationalise their position and have shared some of their responses below.
Customers expect their chosen venues to deliver great experiences from day one, otherwise they might not be returning in May.
Defining the booking strategy
Is it better to allow every seat to be booked up in advance, or to keep it casual with walk-ins only? Unsurprisingly, consumers want… both.
Despite many pub gardens and restaurants advertising as fully booked, there is an opportunity for venues to appeal to a demographic that just want to turn up at a venue – in fact, 60% of our panel expressed that whilst they want to be able to book in order to make plans, they would also like a small number of tables to be left for walk-ins only, so that they could be spontaneous. There is a large market made up of customers who have been either too slow to book or those that just don’t want to – but they need to be able to find this information in a deluge of noise.
Whichever strategy works best for your venue – make sure your guests know the approach you are taking by keeping the website up-to-date, sending email campaigns and posting regularly on social media, in order to both capitalise on the unprecedented demand and to manage expectations.
Deposits
Having guaranteed revenue in the form of a fully booked venue well in advance can be extremely comforting in this economic climate, not to mention it helps with the planning of budgets and rotas, but blocking off a large number of your total available covers as bookings isn’t without risk. With a bit of bad luck, a fully booked venue will have to deal with cancellations and no-shows - this is exactly what operators experienced in August 2020 – another blow to the already precarious balance sheets, stretched thin from a year of trading restrictions and lockdowns.
Careful operators, to reduce risk, are taking deposits for bookings. For those managers who are wary of potentially upsetting customers - our study shows that the majority (63%) are very happy to pay a deposit for a table. The change in attitude towards booking deposits, in comparison to pre-pandemic times (2019), when that figure was only 30%, is remarkable. This was recorded in one of our earlier studies.
Back to 2021 – whereas 63% of all respondents were happy to pay a deposit, that figure is only 50% amongst the Gen Z (18-25) age group. The rate follows an upward trend, increasing to 56% between ages 26-45, 72% between the ages 46-65, and peaking at 80% for people aged over 66.
Another important question - how much to ask for a deposit, so that it covers some of the potentially lost income, whilst not putting customers off? Almost half (47%) of our panel said they were happy to pay up to £5 per person, 42% were happy to pay up to £10 per person and 9% thought it would be acceptable to pay up to £15 per person for a deposit.
Virtual waiting lists
Another option to help manage excess demand for bookings is to integrate the bookings platform with a virtual waiting list, allowing consumers to enter a virtual ‘queue’ for their preferred dates and times. It allows greater flexibility for customers, and helps operators fill up last-minute cancellations. There are plenty of platforms on the market, such as Opentable, Hostme or Eat App.
Customers are adopting new technology very quickly right now, as we have seen with ‘pay & order’ apps, and our panel of consumers shares this sentiment with virtual waiting lists, as over 80% consumers stated they’d like the option to be added to a virtual waiting list, if their desired booking date or time was unavailable.
Interestingly, adoption rates are higher with women (86%) over men (70%). Naturally, adoption rates are high (86%) with Gen Z and millennials (18-35), the rates then decrease in a downwards trend as age increases, the lowest rate (60%) amongst consumers aged over 66.
Minimum spends & time limits
Managing a surge of bookings is a challenge in itself, with good time management being the key success factor, as tables have to be turned on time, lest you keep customers having to queue for a table they already booked. With limited covers, restaurateurs and publicans also want to ensure the bookings are profitable, as nobody wants a table that's nursing two tap waters and a soup du jour to share, whilst you might be turning big spenders away.
Having time limits or minimum spends in place for bookings is a good way to mitigate these issues, and the good news is, over three quarters of consumers (77%) are happy to oblige, with 53% of all respondents ready to keep this up until hospitality re-opens fully, whilst almost a quarter gave no time limit. What’s fascinating is that people are now more willing to settle for a time limit than they did over Christmas 2020, when that figure was 62%.
The responses didn’t vary much by gender, however there was quite a difference in opinions between age groups. Only half of Gen Z respondents said they’d agree to spend or time restrictions, whereas customers aged 36-55 were most happy to comply, with that figure reaching 82%.
The panel did point out, however, that they expect a higher level or service with any additional booking terms, such as deposits or time / spend restrictions. A comment from one of the consumers: “If I'm booking and paying a deposit, I expect service to be better than before!”
Confidence amongst consumers is rising slowly but steadily. We have been keeping track how safe our panel of consumers feel at the idea of going out into hospitality venues.
Our most recent survey results reveal that the average figure is now 7.55 out of 10. That number was 7.51 over Christmas last year, and 7.07 in October 2020.
The survey results demonstrate that consumers are ready and waiting to go out into hospitality venues. They are aware of the enormous swell in bookings in the days after reopening, and therefore they are much more accepting of additional booking terms, however it is a fallacy to believe they are more lenient towards service issues, such as wrong orders or service delays. Customers have waited a long time to come back to their favourite locals, and expectations are exceptionally high – everything must be good, if not great. People are now used to pay-and-order apps and are eager to adopt any additional tech that makes their lives even easier, such as virtual waiting lists. Once they get used to this new feature, it’ll be a convenience they will come to expect – something that’s worth considering.
Customers have waited a long time to come back to their favourite locals, and expectations are exceptionally high – everything must be good, if not great.
