Guest experience reviews are critical to sales performance but those reviews are difficult to quantify. There is real value in online reviews and ratings extrapolated from places like Yelp or Google. When looking at variances over time and comparing with competitor ratings, it can uncover weaknesses, pinpoint low-performing stores and reveal insights that drive marketing campaigns. Zack Pike, vice president of data at Callahan, discusses the benefits in analyzing online reviews.

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Welcome to Callahan’s Uncovering Aha! podcast. We talk about a range of topics for marketing decision-makers, with a special focus on how to uncover insights in data to drive brand strategy and inspire creativity. Featuring Zack Pike and Jan-Eric Anderson.

Jan-Eric:

Hi, I’m Jan-Eric Anderson, President at Callahan.

Zack:

And I’m Zack Pike, Vice President of Data at Callahan.

Jan-Eric:

Zack, welcome back to the booth.

Zack:

Yes.

Jan-Eric:

I wanted to talk with you today about a topic that’s been a recurring thing and it’s a recurring topic that we talk about with clients all the time and it’s a vague topic and I think that’s something that we need to unpack a little bit. So I want to pick your brain on the idea of how the guest experience in a restaurant category at a restaurant, impacts overall sales and how a company’s business is performing. This is a really important topic for us to talk about because you would be hard pressed to find any marketing leaders, CMO, CEO at a restaurant concept who would sit there and tell you that the guest experience isn’t critical to the sales performance within a store.

Zack:

Yeah.

Jan-Eric:

You’ve got this old assumed truth that the best operators, the operators who are running the best restaurants, the cleanest restaurants, the most efficient restaurants are the ones that are creating the best guest experience are the ones that are going to have the best sales performance. That seems to be universally accepted. Yet when you ask then those exact same people to quantify the benefit of having a good guest experience or quantify the suffering on the business that they’re experiencing due to bad guest experience, very few can actually pin it down. And so it’s I think, it’s been hard to respect the guest experience and the role it plays when it’s difficult to quantify what it actually is.

Jan-Eric:

So what I’d love to get your perspective on today and what I’d like to kind of talk a little bit more about is how a restaurant concept can go about taking their guest experience that they’re creating today and understand what its impact is on sales and their ability to drive sales in the future.

Jan-Eric:

So that’s the topic I really wanted to talk to you about and I think a good place to jump off is just to kind of get your perspective on how do we measure the guest experience and how do we even get our head wrapped around what the guest experience is.

Zack:

So you mentioned something about it being … It’s hard to relate this to sales, and I think it’s hard because it’s hard to get the data right? You’re kind of trying to take something that’s very qualitative and to be able to use it, you’ve got to make it quantitative.

Jan-Eric:

Sure.

Zack:

And that is always difficult. In marketing most the stuff we do is quantitative, right? We’re buying media and we’re driving website visits and we’re making sales. All those are hard numbers. So this stuff gets measured to the nth degree, right? We know how many little smiley faces we get on Facebook after our posts. But in something that’s, I think in my opinion, in a lot of people’s opinion, one of the most important pieces of a business, we don’t have that approach because historically the data’s been really hard to get our hands on.

Zack:

So the way that I’ve seen people measure this customer experience type thing, there’s a few different methods. One is a traditional like customer satisfaction surveys, right? You get a survey in your email after visiting somewhere, you might get a 10% off coupon for filling it out. You even do this, like in retailers, right? If you go to Home Depot, they circle the little thing on your receipt say, “Hey, take this survey. You’re entered for a chance to win a $50 gift card,” or something. So that’s one way. Typically when I’ve looked at that type of data, it’s answers to questions. That’s really hard to turn into usable, measurable data over a long period of time.

Zack:

The other way is there are companies that offer this type of service at a different level, right? They’ve got some form of app that you download and you can provide ratings and things through the app for different locations and even past that, sometimes you’ll see a little kiosk inside the stores and you hit a red, yellow, or green button on your way out and that gives them some indication of your experience.

Jan-Eric:

Again, some concepts you even see like a Dropbox of leave us your comments and there’s a little tear pad and some pencils.

Zack:

Right. That’s old school.

Jan-Eric:

Yeah, that’s super old school. Yeah.

Zack:

So that’s two. The other, the other way that I think people use most often is anecdotal feedback. So I’m the guy in the store every day. I know what my customers are saying, I know what the experience is, which we all know the pitfalls and something like that.

Jan-Eric:

So, let me ask you about that- with what people are saying and some of these, you know, the smiley face, a neutral face, frowning face, those types of things. There are other metrics that are operational indicators that are I think assumed to be indicative of what the guest experience is. And I’ll give you an example of that. If I’m in a fast food or quick serve concept, speed of service is something that I’m trying to deliver. I can look at through my POS, I can look at how how much time elapsed from when the order begins to when the order’s fulfilled. There is an assumption that the speed of service is an indicator of guest satisfaction.

Zack:

Sure.

Jan-Eric:

So yeah, that would be probably another whole set of … Beyond just the guest feedback. But looking at these operational metrics, I’m assuming then that the operational metrics are leading to a guest leaving satisfied with what their experience had been.

Zack:

Right? Yeah. And then the … So I agree with that, but the hard part is we’ve got to understand what the perception of the experience was with the customer because like if you think about, let’s talk about McDonald’s, they could have super fast service, right? All the brand standards could be there, the store could be clean, but if the order was messed up, that could ruin the perception of the entire experience for the customer.

Zack:

So well we’ve actually found a lot of value in is grabbing online reviews that no one really had any influence on. It’s unsolicited reviews on places like Yelp and Google. And typically the ones we’d like to stick with are the ones that are named reviews where you have to leave a comment. Yelp is one of the strongest ones for that. Google does that pretty well too. Now that data requires a different acquisition mechanism than some of these others. But that’s kind of the last, the last of these, these lists of ways to collect this information. And that’s the one that we’ve had a lot of experience with and seen a lot of benefit from.

Jan-Eric:

Now are those comments all just trolls? Haters are going to hate and all you ever see is people reporting the bad. So is it really fair, a fair indication of what the guest experience is?

Zack:

Well, in the data we’ve seen, it’s not all trolls and the real value in that data. There’s really two ways to look at it. One, is look at it over time, right? Cause if … Let’s just talk about Yelp to make it easy. If Yelp is just full of trolls, you would expect the troll factor to be consistent over time.

Jan-Eric:

It’s always hate all the time.

Zack:

Right. So if you’re looking at variances over time and your percentage of negative comments hypothetically is rising over time, you wouldn’t expect that to be caused by the fact that there’s a higher rate of just mad people on the platform in general.

Zack:

So yeah. The other way to evaluate that is to look at it in comparison to your competitors. So if your competitors all have that same factor, so