Create a value exchange so customers want to give you their data

Liam and Sam Brown discuss the concept of value exchange in the hospitality industry. They highlight the importance of capturing customer data and offering something of genuine value in return. 

Sam shares examples of successful value exchanges, such as birthday clubs and personalised offers. He emphasises the need for a clear narrative and internal communication within the business. Sam also provides advice on choosing a value exchange that aligns with the brand and offers quick wins for time-poor operators to start collecting and using data effectively.

Takeaways

Hospitality operators should capture customer data and offer something of value in return.

A clear narrative and internal communication are essential for a successful value exchange.

Start with a simple value exchange that aligns with the brand and track the results.

Regular communication with customers is crucial for building loyalty and increasing revenue.

Chapters

00:00 Introduction and Congratulating Airship and Toggle
01:03 Busy Periods for Airship and Toggle
03:24 Introduction to Value Exchange
04:18 Hospitality's Data Collection and Marketing Challenges
05:47 Importance of Customer Engagement and Retention
08:16 Creating a Value Exchange
09:09 Examples of Value Exchange
12:09 Choosing a Value Exchange
13:15 Commercially Advantageous Value Exchange
17:16 Simplicity and Effectiveness of Value Exchange
20:59 Importance of Regular Communication with Customers
21:29 Quick Wins for Collecting and Using Data

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Transcript

1:01

Awesome and I've got Sam thank you so much for being here mate lovely to meet you. Yeah lovely to meet you too, thank you so much for having me Liam, a pleasure looking forward to this. Yeah same so first thing to say actually to you is congrats because we're recording this slightly after Black Friday and you guys over at Airship and Toggle had an amazing period. So well done. Yeah. Thank you very much. Yeah. It was, it was chaotic, but it all went well. I mean exceeded all expectations. So bravo to all the operators that we used in Toggle last week. There was a lot of money going through it every second. Yeah. And yeah, Christmas is coming, I guess. So that's another busy period for you probably, isn't it? Yeah. So Black Friday's pretty much one of our busiest days, uh, in isolation. But as Christmas gets closer each week. uh, breaks the record basically of all time because the platform gets busier each year and in December each week trumps the previous week. So between now and Christmas every week will be a record breaker. Fantastic. Toggle historically. So yeah, it's a Christmas Eve sadly, uh, is the busiest day of the entire year. It's mostly a certain gender and a certain age bracket. It's me. Bye. It's me. It's you. Yeah. Fine. If God's. My wife. So if, okay, people have clicked through to this because they're interested in what this value exchange thing is, you know, um, obviously we're, we're talking about your day job there, but just let's give people a full back backstory. So can you just take a minute or two to tell people, I guess, who you work for, um, what it does and why we're going to be talking about this, this value exchange thing? Yeah, absolutely. Um, so, uh, my name is Sam Brown. I'm the chief commercial officer for chief commercial officer. There we go. of mouthful for Airship and Toggle and that's one company and we're a tech supplier for two different tech platforms specifically for hospitality. We've been going for about 23 years and we've got two different platforms there which will keep completely separate and then today we're talking mostly about Airship which is our CRM platform. So it's a hospitality specific CRM platform that allows hospitality brands to have all their customer information in one place. whether it's collected through any combination of guest Wi-Fi or EPOS or order and pay or feedback platforms or table booking, et cetera, and send out marketing emails or text messages to get more people coming back in more often, spending more money. And then our other platform called Toggle, much younger, launched in 2018, is in its simplest form, a hospitality specific gift card platform, which allows any operator of any size physical and digital gift cards online and in venue, as well as hospitality experiences or retail or free of charge cards to drive more out of venue revenue. So it's just keep making revenue from your customers even when they're out of venue. And we're forecasting to have about 45 million pounds worth of revenue go through that platform in 2023, which realistically we're gonna exceed now based on having 5.2 million go through on Black Friday promotions alone. So. Yeah, lots going on between the two platforms, but we'll focus probably more on Airship with the value exchange. Yeah, superb. Big numbers there, mate. So the, this idea then of value exchange. So when we had our phone calls to kind of set this up and I was asking you, you know, what you would like to talk about, and you talked about this value exchange and it really kind of piqued my interest because I think, um, hospitality operators should be taking people's data. Okay. So we should be capturing people's data and a lot of them are not very good at it and we'll talk about that. But I think before you can even think about you taking someone's data, you know, you, you will have things you want to do with that data, but you've got to offer them some something, the customer, some sort of genuine value for actually doing that, haven't you? And I think the way you put that, I think it's fantastic. I want you to qualify for me though. What is the, what is the issue? If I. don't offer value? Yeah, it's a really good question. And it's far from me to instruct any operator how to go about their business. And I know there's many things they have to worry about other than just data collection and marketing. I have the luxury of my life being focused on a very small niche part of hospitality. But I think what we've seen as a business and something that's kind of been passed through our culture is that a decade or so ago, I think hospitality was actually much better. sweating its data than it is now. There's large teams and the large groups literally working through data, emailing, calling, having relationships with customers and really kind of sweating that data to try and push the maximum amount of revenue to come from an existing customer base as possible, you know, and there was big teams with big targets, big budgets to do a maximized value of that data. And I don't want to oversimplify it, but I think that when GDPR was introduced, there was a lot of fear from everyone. about what that meant you could and couldn't do with marketing and email addresses and contacting your customers. And therefore, I think people took a step back. A lot of people in the boardrooms were like, okay, this feels like it's more risk than reward, potentially we get this wrong, unlimited fines. And so people kind of took a step back in general. And also, we know in terms of team sizes, Hospitality is not famous for having huge marketing teams, so there's a lot of plates to spin. But in terms of the value exchange, our understanding or our belief, as you mentioned, Liam, is that if a customer is engaging with you as a brand, then it is much easier to keep that customer than win another customer. And it is easier for them to be cross sold to, cross sold to, and to keep them coming back in and spending more money on different day parts and different products with you. So a lot of hospitality brands, if you visit their website or any of their journeys through, say, table booking or buying a gift card or... being in the venue. There'll be an opportunity to leave your data, but it will almost be a sterile transaction. So on the website, you might see, sign up to our newsletter. But two things are happening. One, there's no incentive to grab you. So let's just sign up to hear what we're up to. And then there's no kind of narrative around what to expect because of that exchange of data. I mean, the worst example is people like Mothercare when they were still in business for someone who now has a lot of children. You would go and buy a pram or something from the physical retail shop. You go to the counter and they'd say, I need to take your email address to give you a receipt. It wasn't an option. You physically had to give them your data. If you wanted a receipt in case the wheel fell off your pram, when you got home that evening, and that almost left a bad taste in your mouth. If you weren't feeling positive about that brand because you were, you're being held ransom essentially with your data, because we all realize that to one level or another, our data is a commodity that has a price tag on it. And brands want to market to us and they want to market to us because they want to spend more money with them. Which I think almost at some point in the last few years, there was almost a negative connotation with this idea of handing over our data, but hospitality brands just want to match their right customer with the right food item or the right offer or the right event and give them something that they want. No one's going to force me to eat another Aberdeen Angus beef burger. I want to eat it. but my colleagues at Airship and Toggle, who are vegan and vegetarian, should probably be getting marketed a different food item, or they should be getting marketed at different times of the week or different times of year. I probably wanna hear about the family-friendly offers they have at the weekend, so my tribe can all come in together. But colleagues like our head of sales might wanna hear about the bottomless brunch or some evening events that are going on past my children's bedtime. So the idea of this value exchange, sorry, I'm waffling quite a bit here, but the idea of the value exchange is that, A, But any level, there should be a narrative within your business about why should the customer care about giving you as a hospitality brand their data? You know, what's in it for them? What is the value that is being exchanged by they're saying, I'm going to give you my commodity, which is my data so you can access me outside of venue and give me information and try and sell me additional products or retail or events or gift cards. What am I getting? And we work with lots and lots of brands on this, this kind of topic. And we've launched. hundreds over the years of friends of or a team or VIP lists or the birthday club. And it can be as simple as, if you join our mailing list on your birthday, you get a free cake or you get a free bottle of champagne. Or if you join our mailing list, you'll get first refusal to attend any of our events that we're hosting any of our venues. So if we're hosting a New Year's Eve or a Christmas bash or a World Cup, you'll get first refusal to book a booth for the football or to... attend on New Year's Eve bash, or you'll get discounts on certain items all year round, or you'll have a permanent discount, or there's all manner of these things that you can do. So for example, and we'll talk about how you land on what your value exchange is as well, because I think it's really important to include your team in the venues, your front of house team and your customers, whilst landing on what your value exchange is and as you evolve it. So When we try and work with brands to discuss this, we try and do a bit of a discovery with them and say, okay, well, what are you known for as a brand? What is important to your customers? Why do they love you? Why do they keep coming back? Because one thing that can happen quite easily is you might have a group. There was a pub group and I won't name who they are, but if you search on our website and look around their websites, enough, you'll find out who this is. Um, to sign up for their newsletter, there was 12 fields you had to fill in. You know, even if you scanned a QR code in venue or you book. table or you want to go to a site there's 12 fields to fill in so first name, last name, date of birth, mobile number, home address, you know all these different details and we sat with them and said okay let's reduce it to the minimum friction for someone to get onto your database and we found out what they were known for and one of those things was that they were famously popular for dog owners they're all dog friendly venues that were really quite a high quality. And so they have something on their value exchange where they've got a furry friends birthday club So when you're filling in the form you need to put in your first name your email address your mobile number your date of birth So only four fields so far and they can already contact you. They know your name and your date of birth and They actually for your anniversary because this is the sort of place you go for a special occasion And they also ask for your dog's birthday, which is optional. You might not have a dog but you put your dog's birthday in it says expect a special surprise near your furry friend's birthday and then an automated email will go out and say hey Liam we believe a special furry friend's birthday is coming up soon please see a QR code below for a free bowl of dog food and a free bowl of water it will expire 14 days after his or her birthday you know please come into the venue and redeem and then they can track that back but it's just this value exchange of okay by giving you the data i get this nice little special occasion for someone who's important to our family and we can go out and we know a welcome because they're not a common thing for dog owners. So it's about, it doesn't have to be that exactly of course. And it can be much more simplistic, but the value exchanges, do you have that narrative in your business of what the customer gets for giving you their data? Yeah, love that. You've just, you've just nailed me again because me and my wife don't go anywhere where you can't take your dog. Exactly. And the second part of that is, which we'll get onto is, does that narrative run through your business? Yeah. It's all good and well, the marketing team knowing it and it's on your website, but do you front of how staff team know it? You know, and I get it, there's a lot they have to know, but is there a concerted effort internally to speak to the team or GMs and everyone about this is what we do and this is why, and this is why customers enjoy it. And then is there a bit of an echo chamber going around the business of here's the results we've got back from it. Here's the high- that we saw here's some great feedback and is it feeding through to your Google reviews or TripAdvisor or Feed It Back or Yumping or HM? Is it continuing to do that? And if not, let's keep tweaking this value exchange, keep training. So they're the two parts. Does it exist and is it common knowledge across as much of the team as comfortably possible so that they can speak comfortably to the customers at the right time about these things? Yeah, yeah. I love that. I want to drill down a little bit into the idea of choosing the value exchange. I get, I think the easiest thing to understand there is that it should be in line with your brand. So if you're, you know, coffee, a, it depends on the coffee shop, maybe, maybe it should be coffee related or, you know, dog shop, like you say, it should be, um, dog related, but how would you, what advice would you give on choosing one, which is most commercially advantageous for you, let's say. Okay. Well, I think the nice thing about. is that there's so few people doing the basics of automated mass marketing communication well that just doing anything and then reviewing the results and tracking it properly gives you a massive advantage over 90% of the people out there. I mean we did this terrifying internal review about a year ago where we looked and said okay birthday journeys. I know we're deviating slightly from the value exchange, but how many of our customers in Airship have an automated birthday journey life? It's the simplest thing in the world to do. You know the birthday for all of your customers, pretty much all of them, because you captured that data. Do you have an automated email outgoing saying, hey Liam, your birthday's coming up. We'd love to give you X, Y, and Z. We'd love to invite you in to try X, Y, and Z. We'd love to give you this voucher, this gift card, to try and drive a visit. And over 50% of our customers... didn't have any birthday journey live at all, combined millions and millions of lines of data, millions and millions of opportunities to bring those people in or around their birthday. And they weren't. And we know that the average automated email for someone's birthday brings in around an extra £20,000 per location per year whenever we put it under the microscope and said, tracking redemption of vouchers or gift cards you've given and then comparing it to the basket on the till and then seeing the uplifting spend. So in fact, there's a group called, well, there's a venue called the Tap and Run that's run by Stuart Broad and Harry Gurney, the cricketers that had a wager with our CEO almost two years ago. He went there, sat in their beer garden, got very drunk, I imagine, and said, listen, I will bet you. that one automated journey, one automated email through Airship will pay for the entire platform several times over, otherwise you have the entire thing for free. So not using all the manual sends or doing all the automated emails or all the other things you can do through it, one automated email will pay for it several times over. And a year later we looked back and they had one email that just sent out a birthday message saying, hey Liam, your birthday's coming up, a tax as a gift card for a bottle of Prosecco. It expires in 14 days, we'd love to see you in there. and they could see that alone had generated an extra 13,000 pounds of spend in that one venue. And so in terms of what would work most commercially for you, there's so many options, but my, my advice would be just to start with something simple and something, and something widespread across all your customers, you know, what's your hero item or what do people know you for? What, what's the thing that you've got the best margin on that you don't mind sacrificing and just turn it on and then track the redemptions because through platforms like Airship or many other CRM providers that are out there now or other tech providers, you can usually track things like redemption and spend and items purchased. So even if it's not perfect, depending on who you use, you can probably track to within pretty close accuracy how successful it was and then just keep tweaking it. We see some crazy ones, we see some pretty simplistic ones, but just start. is the main thing. Don't worry too much about getting it perfect. It wasn't there yesterday. Your customers will not feel negative about the fact that you're trying to create a value exchange where there wasn't one previously. I think from a, from a customer's point of view as well, I think I would probably value something that was simpler rather than more complex of whenever I, I guess this is for any industry really, but whenever I get an offer that is quite complex, I'm usually slightly put off by it, whereas if I've got a nice, simple offer and like your pet, your example is perfect. Come in within 14 days and you'll get a free bottle of Prosecco. I know exactly what is that about? There's, there's absolutely no way you can confuse that, you know, and it's really simple, but when you start going into layering the offers together, spend this much and then you get 10% off. And then if you bring your dog and your dog got brown eyes and all this, it's kind of, you know, Yeah, it's so true. And There's some lovely ones and there are some out there that are a little bit more personal. So we've got this wonderful chain of Indian restaurants that have their own spin on a special martini, which is like a spice infused one. It's, you know, basically come in and get two of these for free within a certain number of days of signing up for our database. And it's a nice little thing. It's a personal item and it's a bit of a talking point and it's coming in, coming in for a cheeky chat. They call it. and it's you and a friend coming in to have an occasion and have two free drinks. And you're like, okay, well, that sounds like a special occasion, but other people take it in different directions. There's a small pub group that are quite well known in London, at three or four venues. And what they do is around birthdays for their value exchange. And they don't mention this during the narrative, but it works really well as they send that an email saying, hey, your birthday is coming up as a loyal customer and a value customer, we'd like to give you them. the option to book our private dining room free of charge, no extra cost for your birthday, full well-knowing, having it full with 16, 20 people and they're gonna make a fortune anyway, for something they usually charge a minimum fee or a booking fee for. And they turned that on this year. And by kind of start of Feb, they'd already had more private function room bookings than the entire previous year. And it's not because the wording's magical or that our emails are better quality than other people's emails. It's just that if you've got 200, 300,000 people signed up to your database, and they're all getting this consistent, pleasant, tailored, personalized message at the right time of year, if you ask 100,000 people something, you're probably gonna get 50 of them to say yes. And the other 99% probably aren't gonna be offended that you said, hey Liam, would you like this thing for free? Don't worry if not. And it's just about taking advantage of this. huge opportunity all hospitality brands have now because there's never been this much personalized data available for such little effort. Does that make sense? Like you, I know for a fact, a lot of our customers complain sometimes saying everywhere I turn, there's another bag of data and it's just everywhere. Like what, look at this, another Sainsbury's bag just full of data. And you're like, what am I going to do with all? And they need somewhere that's just going to store it all, keep it all organized, and then automatically just keep going through and go, okay, send that out. It's their anniversary. Send them out a nice thing saying, we'd love to host you on your special wedding anniversary or dog's birthday or their birthday or actually Liam used to come in once every month and we're not seeing him for two months. So send him an automated email saying, you know, please don't leave. Like wherever you've gone, we love you Liam, come back. And you know, these things just need to be automated. There's no black magic to it. It's just. If you properly sweat the data you've got and speak to your customers, how they want to be spoken to with the right message at the right time, you'd be amazed at the uptake because the numbers now are just so, so huge. Yeah. And I think it can feel like a really big job to somebody who's not doing this right now, but like you say, there are, there are easy ways to do this. So let's assume that we've got some listeners who might have a restaurant, for example, a big coffee shop, whatever. And they're thinking, you know what, we really don't, we're not collecting or using as much data as we, as we can here, but they've really time poor, like really time poor. What, what would you say are some of just some nice, easy, quick wins that they can do? Yeah. Okay. Um, so the biggest, um, sources of data that we collect, I mean, there's a, there's a few, and it depends on the activity of the actual customer themselves, but things like just putting, um, uh, a data collection. on your table booking software, which should be there for most table booking software. So you're given the option to opt into marketing. That'll be a huge amount of data being collected every time the tables booked. You'll get probably around 30 to 50% of them saying, yeah, that's fine. Happy to receive marketing. Turning on a Wi-Fi data capture. There's plenty of great providers out there that we work with, the likes of Fidelia, Captive Wi-Fi, Wilder Social, Capptini. many others, you know, there's some great providers now in the sector where you can turn it on the existing hardware you've got and it'll just say, hey, leave me on free wi-fi, cool, don't worry about password, just log in through your Facebook or through your Google mail or your LinkedIn or through your email and you'll get kind of 50 to 70% opt-in for that marketing. You know, you can run competitions like Rudy's, Pete's Arria, I imagine you're probably aware of and may have visited. Yeah. Awesome. Yeah, like Rudy's. They did a wonderful thing where, I mean, they won't mind me sharing this because it's a public case study, but you may be aware they were traditionally very northern base as a brand and had a bit of a cult following. I mean, my son's called Rudy, broke his collarbone actually the night before we flew to Florida to Disneyland earlier this year. And the marketing manager from Rudy sent my Rudy Rudy's black card for free pizzas for life. Oh, wow. Amazing. Yeah, they're a really cool brand. And what they did was they had nine venues, I think, I might have the number slightly wrong, up north. And through Airship, they can track visit frequency because they've got a huge amount of people signed up to their database because their value exchange is really strong and it was a really kind of family feel, really kind of inclusive, you're part of our gang value exchange being part of the Rudy's family. And then they could track every time someone came into their venue because either their phone bounced off the WiFi or they booked a table, they left a review or they redeemed the toggle gift card or they used an app. whatever it might be that kind of said, okay, I'm here. So we could then rank all of their customers based on visit frequency. And we base all customer paces on six brackets that we call POP, which stands for proof of presence. And that's either a prospect customer that's on your database, but has never been in the venue as far as we can tell. Bronze, silver, gold, platinum, it's quite boring titles, but it works, which is the more often they come in. So it could be once a year up to three or four times a month and then lapsed. which is someone that's changed their visit frequency. It used to come in regularly, but now it's disappeared. And they can all get different automated messages. So each birthday message you send out can be different. So a gold customer can get a different birthday incentive to a silver or a prospect or a lapsed. You know, a lapsed customer can get something hyper aggressive. I don't mean this in like angry, but aggressive in terms of a hundred percent off, you know, just get back in. But you're worth nothing to us now. And then what Rudy's did was they rang us and said, okay, shout out to Jack Edge, by the way. who was the marketing manager at Rudy's at the time that does some phenomenal work. He rang us and said, okay, we're looking to open in Soho, which we've never ever been that far south before. People in Soho probably would have never heard of us, which turned out was true. And they might even just think we're independent without a very successful track record. What do we do? And to cut a long story short, we went to their platinum category of their customer base in the north. Went across all nine venues, pulled out all of the dates from the customers. in that top 10% of the people who loved him the most, but downloaded that segment, uploaded it to Facebook and Instagram with him, and then did a lookalike audience said, right, find people in or around Soho with a 5% similarity to this platinum audience. So based on age, gender, marital status, you know, interest in the media, job type, all these sorts of things. Um, and it served up an advert on Instagram and Facebook for people who, um, were socially similar to their most common customers in the North and said, Hey, we're coming to Soho, click here for free pizza. And they had a form behind it on airship and it just said, leave your email address and your contact details and we'll email you when your free pizzas available in our opening day. They had 7,000 people sign up to this before they'd even open the venue. When it got to 7,000 people, it triggered an automatic email out through, and that's the value exchange there. If you like pizza. we're gonna give you a free pizza for your email address. It's got 7,000 people. They sent out an email saying, release the pizzas. Here's our opening date. Here's a link to our ResDiary booking form. Click here to book. And they sold out their first three days of business completely within 17 minutes. And they released another 3,000 free pizzas. So they managed to get 10,000 people on their database before they'd even opened the doors. And then what they did was, when someone came into the venue, and redeemed their toggle gift card through the till. Say, I'm here for my free pizza. It then triggered later that evening, another automated email saying, hi, we hope you really enjoyed your free pizza Liam. Thanks so much for dropping in. Would you be kind enough to leave us a review on TripAdvisor? Here's the link. And it turns out 7,000 people are quite generous when you're giving them a free pizza. And they went to number 24 on TripAdvisor for the whole of London temporarily. And they now repeat this for all of their new openings. But the beauty of that was, those people that came in were socially determined to be more likely to become platinum customers. It wasn't like just randomly handing out free pizzas on the street and hoping they were the right sort of people for Rudy's. They were already aware of who they were. And that's because they got their value exchange right in the north. And because they built this following through not just having fantastic. operations and serving great pizza with great hospitality every time, but also communicating regularly with their customers. And that is a really key thing about value exchange and communicating with your customers regularly is that you find a lot of brands that capture data well and have the right value exchange and they do all the things right, but then they just don't have these automated messages going out regularly. So it might be six or seven months And the biggest reason anyone ever says, Oh, I've just got a spam email. I guarantee it was a venue you went to one night out or one day, or you just popped in without realizing the name of the brand and the email and you go Joe's kitchen. I've never heard of Joe's kitchen, which literally happened this morning. Someone said, Oh, we've opened a Joe's kitchen at this location. I was like, I've never heard of that brand. And then when we looked at the pitch, like I've eaten in there. Yeah. I've eaten there with my kids. I just didn't know it was a Joe's kitchen. And if they wait nine months to email me, I'll think it's spam. If the next day they say, hey, thanks so much for visiting yesterday, here's a download this voucher or download this thing. My brain will go, okay, I've connected the dots. I did eat somewhere. I stay, it must be them open it, click it, and I'll start my journey. So if there's repeated communication from the brand, as soon as you sign up, it becomes familiar and the open rates, um, on emails from a manual one-off send. versus an automated journey that's just regularly going out is phenomenally different. It's the latter is so much higher. So yeah, it makes such a difference. Superb. I love that case study. That's brilliant. And although that's quite specific, hopefully it will get the listener thinking about what can I do? It won't be the same as what Rudy's did, but I can put my own spin on that and I can do something very similar. I'm going to leave it there, Sam, because that was amazing. And I want it to be bite size. I want people to be able to go away and be able to put some of these in action. So thank you so much. That was really, really useful. Um, your LinkedIn bio will be in the show notes. So if people want to connect with you or ask you any more questions or find out more about airship and toggle, please go into the show notes and connect with a salmon from me. Thank you so much for your time. That was amazing. I really appreciate it. Thank you. Have a good one. Cheers.