Restaurant And Hospitality Roundup – August 24, 2015
By Christine Kern, contributing writer
In news this week, research shows that hotel guests will trade info for clear rewards via apps; restaurant execs talk about the pressures of labor and wages; and McDonald’s is unveiling its mobile app and loyalty program.
Guests Will Reveal Personal Information On Hotel Apps For Clear Rewards
A new study by Drs. Cristian Morosan and Agnes DeFranco at the University of Houston Conrad N. Hilton College of Hotel and Restaurant Management has found that more than one-third of all hotels guests said they would reveal personal information on hotel apps if the benefits for doing so are clearly visible. “Guests weigh the risks and benefits of information disclosure and are willing to disclose personal information to apps if the hotels make the personalization benefits clear to them and design apps that stimulate positive emotions, such as joy, pleasure and excitement,” researcher DeFranco said. “Hotel apps should be conducive to trust, and allow guests to reduce their search time and conveniently find/personalize services that are relevant to their consumption.” Research also demonstrated that guests were also more willing to share information regarding room preferences, amenity preferences, or gender than they were to share details about income, credit card information, or identification numbers from driver’s licenses or passports. Moroson explained, “Through smartphone apps and tablets, hotel apps can become rich portals for guests and superb tools for hotels to learn about their clients, anticipate their needs, and provide outstanding service.”
Restaurant Execs Talk Labor and Wage Concerns
This article from the Nation’s Restaurant News highlights the responses of ten restaurant executives regarding labor and wage concerns, in light of local minimum wage rate hikes across the country and increasing competition for workers. The NRN reported that the most recent earnings figures from public restaurant companies demonstrate growing pressure on margins as a result of rising labor costs. So how are execs responding to these pressures? Mike Bufano, CFO of Panera Bread Co. said that “Wage pressures and the war for talent continue to make labor our single biggest source of inflation,” while McDonald’s CFO Kevin Ozan recognized the impact of these incremental labor costs, stating “For us, margin is essentially our top-line gain. So we need to grow sales….The specific labor moves that we have taken are what we believe we should be doing as a business to make sure that we attract, recruit, and retain the best employees we can for our business.“ Executive responses were taken from Seeking Alpha transcripts of recent earnings calls. Chipotle Mexican Grill Inc. has been forced to raise menu prices in some markets to counter minimum wage increases, but CFO Jack Hartung explained, “Our objective will always be to keep our menu accessible to our customers while being able to recruit the best people we can with competitive wages in each market and also while considering the overall cost of doing business and competitive prices.” The article also includes insights from Domino’s, Buffalo Wild Wings, Wendy’s, Texas Roadhouse, the Shake Shack, El Pollo Loco, Habit Restaurants, and Noodles & Company.
McDonald’s Launches McDonald’s Mobile To Reward Customers
McDonald’s has finally jumped on the loyalty program bandwagon with the launch of its new McDonald’s Mobile app in Dan Diego and New York City, according to Payments.com. They join Starbucks, Chipotle, and Burger King, who have already launched the own mobile apps. According to their website, McDonald’s is offering a free sandwich to the first 8 million users who download the app, which features a store locator, menu, nutritional facts for their products, access to coupons and discounts, and a drink loyalty program. The loyalty program, which will only last until the end of this year, allows customers to earn a free drink after purchasing five McCafe drinks. McDonald’s CEO Steve Easterbrook told the press that the fast food chain is “a little behind some others” with the new app, but the company will be testing rewards and looking to expand the app as time goes on.