Casual dining chains conjure nostalgia for many people who grew up in the suburbs. The booths and colorful Americana on the walls have long the set scene for outings with family and friends. The menu is laden with burgers, mozzarella sticks, buffalo wings, and other crowd-friendly comfort foods.However, nostalgia isn’t a big growth driver in the restaurant business.
Millennial tastes align more with fast-casual dining — newer, quicker, less expensive options like Shake Shack and Chipotle. According to Business Insider, the fast-casual dining industry grew by 550 percent from 1999 to 2014. Meanwhile, many Applebees and Ruby Tuesday locations have closed their doors. In order to survive, these eateries must adapt.
“Consumers are what disrupt industries — how they think and how they interact, and what they want from a brand,” said Sherif Mityas, the Chief Experience Officer of TGI Fridays.
In 2014, about fifty years after it was founded, the restaurant chain was sold for $800 million to private-equity firms Sentinel Capital Partners and TriArtisan Capital Partners. Since then, TGI Fridays has refocused its efforts to appeal to a younger demographic.In 2018, the company began revamping its menus to offer new options, including meatless Beyond Burgers. The chain also rolled out a delivery partnership in its home market of Dallas, TX, allowing customers to get a six pack of Sam Adams and an order of potato skins without leaving their couch. The company currently operates 424 restaurants across the US.
TGI Fridays has also begun exploring applications of artificial intelligence. For example, guests can order in restaurant through an app that employs AI to personalize the experience — gathering information like the guests’ food and drink preferences.
Mityas and his team focus on the customer experience at TGI Fridays at all touch points — both online and in the booth. During a conversation with InnoLead at the National Retail Federation’s Big Show, Mityas discussed how using AI and personalizing the dining experience can turn occasional customers into regulars. Listen to the interview or read the transcript below.
InnoLead: … What forces are disrupting businesses like TGI Fridays, both in the casual dining space and in the frozen food retail space?
Mityas: … From a casual dining or a food perspective, our guests are looking for, “When I want to have a food and beverage occasion, be there. Don’t make me come to you. Be where I am. If I’m on Facebook, or if I’m on Twitter, or if I’m sitting at home talking to Alexa, be there.”
For us, it’s understanding how do we ensure that we’re creating that Fridays engagement and that Fridays experience, whenever and wherever our guests are looking for it…. I need to be there on all the voice-assisted devices, so that when [consumers] want to talk to us, we’re able to respond back. We use, obviously, a bot technology. We use AI and machine learning technology to be able to engage with our guests when they’re thinking about a food and beverage occasion.
InnoLead: How are companies exploring the use of AI to innovate their services?
Mityas: The value of AI is doing things that create a natural engagement, but doing it at scale. I could have thousands of people sitting behind computer screens talking to every Mary, and Tom, and Steve, but I can’t do that when I service half-a-million guests every day.
The AI and the machine learning allows us to take all this data that we have, and create personalized engagement, and allows us to talk to individual guests at a scale that we never would have before.
InnoLead: Being able to test and try, and find the new technology that fits for a company, is really a journey. What has that journey looked like for TGI Fridays?
Mityas: With anything, especially with new technology, you’ve got to crawl, walk, run. For us, it was understanding some very simple use cases, to start. I want to reach these types of guests. How do I do that? What do I need to know about them? What’s the data I need to collect? Then, how do I teach my tools?
Basically, AI tools are like babies. You have to educate them on how to respond. It’s taking very small use cases, showing the value, showing the ROI, and proving the value of this technology. Then you can start to walk a little bit. Then you take on more use cases, more breadth, and more types of capabilities that allow you then to start running.
InnoLead: When you find a piece of technology that works, how do you roll that out, from being inside of the testing space, to being out in the world and running out there?
Mityas: …[I]t’s all about creating test beds, where you’re testing with only 5,000 customers. Then you see how that works. Then, “OK, that works.” You now test it with 50,000 customers.
You start taking a measured approach to rolling these types of things out. Maybe, it’s in one market with a handful of stores, before you launch it across 500, across the US.
InnoLead: Outside of AI, what other innovations has your team been working with to improve that customer experience?
Mityas: The other piece we’re looking at is taking out the pain points from a guest experience. When you ask any guest, “What are your pain points when you come to a restaurant?” The first one is, “I want to order that second drink, and I can’t find my server.” How do I alleviate that pain point?
I allow my guests to order that second drink on their phone, sitting at the table. I’m bringing technology into my restaurant.The next big pain point is, “I’m waiting for my check. I want to leave, but I haven’t got my check to pay.” You can now pay for your bill on your phone, as well. It’s going through and looking at, from a guest perspective, “How do I eliminate pain points, and how do I utilize technology to create more of a frictionless guest experience?”
InnoLead: … [A]ssociates also have to adapt to…technology. Do you see a learning curve there, and has that transition been difficult, or do you find that it’s fairly seamless?
Mityas: If you don’t think about using technology for technology’s sake, but think about it from the perspective of who is going to use it or be impacted by it, I think it changes how you roll these things out. It changes how I approach this with my team members and my folks in my restaurants.
That says, “Technology is not here to replace you. It’s here to make your life easier. It’s here to give the guests a better experience. Oh, by the way, you might get higher tips.” …We think about technology as an enabler, not as a replacer.
InnoLead: Customer feedback on all of these new things is really important. Does TGI Fridays have a system for gathering that feedback on these new things that they’re testing? What does that look like?
Mityas: We do. We actually created two different avenues for our guests that are visiting us off-premise — those that get our food delivered or pick it up. They don’t interact with restaurant staff. We have that survey mechanism through their phones, through mobile devices to be able to capture, “How did that experience go for you? What worked? What didn’t work?”
In our restaurant, we also have these tablet devices that allows us to capture real-time guest feedback. If something did go wrong, it actually alerts our general managers inside the restaurant to come and recover that guest, while they’re inside our four walls.
InnoLead: There’s a lot of talk here at the NRF conference about the future of the store, and the restaurant of the future. What do you see a TGI Fridays looking like, as we move forward?
Mityas: TGI Fridays is founded on being a social brand. There’s all this talk about, “You’re not going to need servers in the restaurant of the future anymore. You’re just going to have touchscreen panels, and you’re just going to have robotic kitchens.”
We will always have servers. We will always have bartenders. It’s part of the connection that we have with our guests and our brand.Again,…technology can support that… Imagine there’s an earpiece in my hostess’ ear. When you walk in, knowing who you are, that you’re greeted by name. Your favorite drink is waiting for you at the bar. Your food, that we know you’re going to like, is ready to go. …We create an experience for you that is unlike any other.
Potentially, even in the future, what you’re getting isn’t even on the menu, because we know your tastes and profile so well, that we’ve personalized the menus for our guests, to the point where you’re getting a one-of-a-kind drink that no one else is getting inside our restaurants.
InnoLead: I know that experience has been a big trend, especially moving forward, with millennials and young folks. Do you find that having that level of personalization has helped TGI Fridays appeal to that demographic? Because I know that…casual dining has had trouble connecting with millennials, in the past.
Mityas: Absolutely. Obviously, what I’ll call just overall [the] younger generation, is more used to interacting with technology. That interaction dictates a certain level of personalization. “I want you to know me. I’m not a millennial. I’m Steve. I live here, and I like these things. Don’t treat me like an age group. Treat me like an individual, and I will give you my loyalty.”
At the end of the day, that’s what we’re all going after, is loyalty. We start every day with zero guests. Being able to connect with individuals on a one-on-one basis creates loyalty and creates frequency. That’s the lifeblood of any retail or restaurant chain.
InnoLead: What are the big takeaways that you’d like to share with other innovators from your time at TGI Fridays?
Mityas: There’s three things. One is, don’t try to bite too much off. Innovation doesn’t have to be something massive and something big. … It can start with one small, little use case that shows the value, and really creates the fire that you want going forward. …
The second big thing is, don’t be the smartest person in the room. There’s lots of bright, new startups and innovative organizations, and just two guys in a garage, that you can start leveraging out there, because there’s so much great talent. There’s so many new ideas going on. You don’t have to do all this journey alone.
The third is, focus on innovation that creates value. What I mean by that is, you can get enamored by the shiny new object. You can get enamored by the cool new technology. If it doesn’t drive a ROI, if it doesn’t drive a value for your guests, and then, ultimately, for your organization, it’s meaningless.
It can be tech cool, PR cool, but that’s not going to move the needle at the end of the day. Focus on what drives a good return on that investment.