Bar Hospitality: An Untapped Market

bar hospitality


To: Bar and Restaurant Owners

From: Dylan Sheffer, Student/Developer

Subject: Bar Hospitality Technology: An Untapped Market

Purpose

The purpose of this study is to determine if there is a demand for a digital drink menu and the features it would provide. From my survey data, the most demanded features include: detailed information on drinks such as ingredients, ABV, descriptions, tags, images, flavor profile, and user submitted comments. Other features were the ability to order straight from a smartphone, generating recommendations based off taste, and searching the menu.


Summary

Technology has allowed for the freedom of information to expand, making consumers more information driven. Right Now Technologies found that 55% of customers will be more loyal to your business when more information is provided to them (Receiptful.com). With the rise in big data and premium media services, consumers are becoming more and more accustomed to having entertainment and goods tailored to their desires. The Accenture Personalization Survey found that 60% of customers today want real-time, customized promotions (Accenture.com). There is an anti-industrial movement where people are rejecting cheap, low quality goods and adopting local, seasonal, “craft” goods. Entrepreneur states that “Craft beverages reflect [millennial’s] particular preference for local, environmentally sustainable products, and while these beverages may cost a little more, they’re affordable luxuries that reflect this generation’s idea of sophistication and education”(Entrepreneur). In the center between all of these major trends is a largely untapped industry; bar hospitality technology.

Drink menus at bars and restaurants have largely been the same for many years. They are a static list of drinks merely stating what drinks are available, and perhaps a basic description with a few pictures sprinkled in. By digitizing drink menus, it allows bars and restaurants to capture the great trends of today. When a customer clicks on a drink using a digital menu, they are presented with information that goes way beyond what is available in a traditional menu. There are images, descriptions, alcohol content, flavor profiles, ingredients, tags, and user submitted and professional reviews. The service also can generate recommendations for users based off of what they have been drinking recently. It is comparable to Amazon’s or Spotify’s recommendation engine. A large fork in the Craft Movement is the Craft Beer and Craft Cocktail movements. People are now paying attention to quality, flavor, and presentation of what they are consuming. By empowering users with information about what they are consuming, packaged in a sleek application, it will connect customers with the product they were looking for along with a perceived premium feel.

By using the ethnographic method of surveying people, the results showed that people responded highly about the proposition of a digital drink menu and over 90% of participants said that they would order new products if there were more information provided to them. When asked what features they would like to see in a redesigned drink menu, the major themes of the responses were ingredients, descriptions, comments, price, alcohol content, and to easily customize a drink. So, the research shows that the trend of providing transparent and tailored information information most definitely extends to the bar.

Thank you for taking to time to read my proposal and I hope you will consider implementing bar hospitality technology into your establishment. If you have any questions or comments, you can reach me at dylan.sheffer.12@cnu.edu.


Abstract

“Bar Hospitality Technology: An Untapped Market”

The study was created to see the feasibility of creating a brand new market in the software development industry: Bar Hospitality Technology. Using ethnographic and quantitative surveys, I specifically studied people’s opinions, experiences, and desires relative to a digital drink menu for bars and restaurants. The timing is right for this particular service because of three major trends in consumers right now: the need for more information, having promotions tailored to individuals, and people’s desire to consume “craft” products. As of November 2015, there is little to no competition in this niche market place, but my research shows that there is a demand for this type of service. From my survey data, the features people desire are a comprehensive list of ingredients in each cocktail, a detailed product description of each beverage, images, user-submitted and professional reviews, drink recommendations, and specially curated seasonal menus.  My findings show that millennials are my main demographic and that over three fourths of people surveyed would use the software as long as they did not have to download anything. By utilizing this piece of new software, bar and restaurant owners will be able to greatly increase their customer satisfaction and make their establishment have a more premium appearance.

Keywords: bar, restaurant, craft, beer, cocktail, digital menu, drink menu, smartphone, app, bar hospitality technology


Introduction:

From September to November 2015, I began research on the feasibility of creating a brand new market in the software development industry: Bar Hospitality Technology. I specifically studied people opinions, experiences, and desires with digital drink menu for bars and restaurants in mind. The timing is right for this particular service because of three major trends in consumerism right now: the need for more information, having promotions tailored to individuals, and people’s desire to consume ‘craft’ products. Currently, there is almost no competition in this niche market. The closest competitors are Ziosk, Digital Pour, and Enplug, but each of their products fall short of providing a tailored service to an establishment’s patrons at a fair price.

Based on my research, the features I propose for a digital menu are, at least, a comprehensive list of ingredients in each cocktail, a detailed product description of each beverage, images, user-submitted and professional reviews, drink recommendations, and curated seasonal menus.  Additionally, I recommend other features such as the ability to order straight from smartphone, generating recommendations based off taste preference, and searching the menu by tags or characteristics. Using a quantitative and ethnographic approach, I began to survey people to determine their demographic, how often they go to bars and restaurants, what features they would like to see in a digital menu, and what conditions would need to be met for them to utilize a digital drink menu service. My findings show that millennials are my main demographic and that over three fourths of people surveyed would use the software as long as they did not have to download anything. By utilizing this piece of new software, bar and restaurant owners will be able to greatly increase their customer satisfaction and make their establishment have a more premium appearance.


Theory:

I designed my study with ethnographic and quantitative theory in mind. I wanted to fully understand what demographic, would enjoy using a digital drink menu, what features people would expected to see, and what their dining and drinking habits are. An ethnographic study is defined as scientific research on the customs of individual peoples and customs. The ethnographic research method allowed me to gather direct input from the people surveyed about what features they would like to see in a digital drink menu. The quantitative portions allowed me to easily divide all the responses into different demographics such as age, frequent bar or restaurant goers, purchasing habits, and smart phone users. All of which must be considered when deciding on the use of Bar Hospitality Technology. My hypothesis going into this study was that millennials would be my target market, people desire more detailed information about drinks before ordering them, and that people are less likely to use a service that requires them to download an app. After reviewing the data, I found that my hypothesis is largely correct.


Method:

I conducted a twenty question survey utilized Google Forms. The study featured seventeen multiple-choice/yes-or-no questions and three free-response questions. The selection questions were used to find out demographic and technology use information. The free-response questions were used to see what occasions change individual’s drink preference, what features they would like to see in a digital drink menu, and to list any concerns they might have with the service. The respondents included many Christopher Newport University students who answered off of CNU’s Facebook page, and people who found the survey via Twitter.


Findings:

The findings section of the paper will describe the findings of the major questions in regards of the need of a digital bar menu. You can find the list of questions asked in the Appendix.

  • When asked how often they ate out or went to a bar in the last 30-days 41.2% responded with 1-3 times and 35.3% responded 4-6 times. Surprisingly, 23.6% of people said that they sat down at a bar or restaurant a minimum of 7 times this month. The data shows that the bar and restaurant industry is live an well and that people are patronizing these establishments regularly.

Sat Down In Bar:Restauant

 

 

 

 

 

 

  • I additionally asked how frequently one order’s an alcoholic beverage and within the people who are of age, 37.5% order a spirited drink weekly, 16.7% bi-weekly, 29.2% monthly, and 16.7% abstain. The data here shows that potentially 83.4% of respondents are all potential users of a bar hospitality technology service such as a digital drink menu.

Screen Shot 2015-11-10 at 2.18.03 PM

 

  • I asked the question “Would you say that you enjoy trying new items?” and gave a few different responses they could choose from. The purpose of the question is to identify if the trend that people are more willing to purchase different things as long as there is more information provided. Based off my survey, 50% of respondents say that they are only willing to try something new if they have more information about what they’re getting. 26.5% of people enjoy being adventurous with their purchases and only 5.9% of responses say that they know what they like and that more information would not change that. When half of a customer base is willing to purchase additional products when more information if provided, there is a lot of potential.  To accompany the previous piece of data, I forwardly asked if they would be more inclined to try a new product if there was more information provided, 91.2% of respondents said yes.

Screen Shot 2015-11-10 at 2.34.44 PM

 

 

 

 

 

 

 

  • The next set of questions were asked in order to determine the way people would prefer to access the digital drink menu. Only 50% of people said that they would use the menu if they had to download an app and 23.5% of people say they would only download it if there were additional incentives.

download app

 

 

 

 

 

 

  • Once we take out the downloading factor, 76.5% of people said that they would use this service on their own phone and only 5.9% of people would require additional incentives.

no download

 

 

 

 

 

 

  • Finally, I asked if they would be more inclined to using the drink menu if the establishment provided a tablet. The number of yes respondents jumped to 82.4% and the people demanding additional incentives stayed the same.

provided tablet

 

 

 

 

 

  • What this information tells me that most people are willing to use this service as long as its just as convenient. However, what is promising to small business owners is that there is only a 5.9% difference between people willing to use their own hardware and the business having to purchase thousands of dollars in equipment or pay up to $1000 a month for a service such as Ziosk where the service is not even tailored to this industry (BizJournals.com).
  • With my product justification proven, I then began to analyze features that users would like to see within a digital menu. I took all their free responses and placed them inside the word analyzer, Voyant-Tools to bring forward the common phrases and words. I found that the most requested features include the ingredients, descriptions, images, price, alcohol content, calories, order customization, and suggestions.

features

 

 

 

 

 

Based on my examined research, I conclude that there is a large demand for this new market of Bar Hospitality software. When an overwhelming amount of the participants state that more information is key to whether they will purchase a good, then it is the duty of the service provider to give the people what they want. According to my data, smartphones are in 90% of people’s pockets, so it is not necessary for business owners to invest thousands into new infrastructure when they can utilize software that is accessed on their patron’s personal hardware. In conclusion, my research shows that bar hospitality technology is in demand right now and it is incredibly affordable for businesses. It can easily create a larger perceived value on an establishment’s drinks and ensure that customers are more satisfied than they ever have been.


Bibliography:

75 eCommerce Facts, Quotes & Statistics that Will Blow Your Mind – Receiptful. (2015, April 22). Retrieved November 10, 2015, from https://receiptful.com/blog/75-ecommerce-facts-quotes-statistics-that-will-blow-your-mind/

Craft Brewers: This Is What Your Customers Want. (2015, July 14). Retrieved November 10, 2015, from http://www.entrepreneur.com/article/246092

U.S. Consumers Want More Personalized Retail Experience and Control Over Personal Information, Accenture Survey Shows. (n.d.). Retrieved November 10, 2015, from https://newsroom.accenture.com/industries/retail/us-consumers-want-more-personalized-retail-experience-and-control-over-personal-information-accenture-survey-shows.htm


Appendix Table of Contents:

  1. Screenshot of the Survey
  2. Additional Data Visualizations

 

1.

Screen Shot 2015-11-16 at 12.07.43 AM Screen Shot 2015-11-16 at 12.07.59 AM Screen Shot 2015-11-16 at 12.08.20 AM

 

 

 

 

 

 

 

 

 

 


 

2.

more info Occasions Screen Shot 2015-11-10 at 2.43.37 PM Screen Shot 2015-11-10 at 4.16.58 PM Screen Shot 2015-11-10 at 4.17.58 PM Screen Shot 2015-11-10 at 4.18.37 PM Screen Shot 2015-11-10 at 4.19.34 PM Screen Shot 2015-11-10 at 4.20.09 PM what to order

 

 

Screen Shot 2015-11-10 at 4.23.26 PM

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