A friend recently asked me, “Why should I have a website for my restaurant? I already engage my customers on Instagram and Facebook. It is hard for me to manage a restaurant website and I don’t see any benefit of having one. I would rather have a blog!”
Before I begin reasoning the unambiguous importance of having a website, allow me to give a background and explain why this may be the very logical case for most of the restaurant owners in India (and even around the world).
Default Customer Acquisition Channel
A restaurant, café, or a pub/brewery usually have very appealing interiors, loud (or light) music, and an ambiance that attracts people to spend quality time there. They do some marketing and get listed on local food aggregator websites such as Zomato or Swiggy (OpenTable or DoorDash in other regions). But, they never actually dedicate a chunk of their time to marketing, since operating the restaurant itself is such a challenging task.
Most restaurant owners maintain a decent quality and inclusiveness that is true to their theme, but most of the time is spent on just making sure everything runs smoothly. This is especially true for a larger restaurant setup, such as a brewery or a 100+ seater restaurant. Their primary acquisition channel is their décor and appeal of their ‘front gate’! The ‘front gate’ here refers to the branding, lighting, logo, theme, visual appeal, music, ambiance, staff uniform and professionalism, etc.
At least, that’s what it used to be 5 years ago in India. Now, almost everyone checks Zomato or Google Reviews of the restaurant, reads what others say about them, and only then decides whether they want to go there or not. Since most restaurants do get themselves listed in Zomato, this visibility gets covered easily. If a restaurant is unable to get a good review early on these platforms, there may be negative effects on future footfall and/or reviews.
A ‘Dystopian’ World
We hear in news a lot about technology acting as a monopoly, that is curbing new businesses to emerge. There are antitrust laws under which the big 4 have repeatedly paid multi-million dollar/euro fines, the senate hearings of Apple, Google, Amazon, Facebook, and so on. This is the world we are living in now. The reason we are hearing about this is that they have started using their monopoly position to hurt BIG businesses. Most of us are not big businesses (unless you are someone in the CXO level in YUM, or Dominos, or McDonald's). This view is not complete.
There are various MINI-monopolies in almost every market or region. And these monopolies are usually the aggregators/marketplaces of the market. They sound like this, “we help small & medium businesses in XX market become discoverable, make them accessible online, or we are XX discovery platform.” They all sound the same, and I can assure you, whenever you hear something similar to a “marketplace/platform/aggregator for X” and get to know that the startup is funded, think of them as they are either a monopoly in that segment, or just trying to build one. There are aggregators in online education, e-commerce, online transactions, transportation, logistics, hospitality, grocery delivery, and of course, in food discovery and delivery.
Everyone in the food industry knows that the 1 thing needed to succeed in a restaurant business is ‘Location’. A great location can compensate for operational issues, and a bad location can sink the greatest taste. Selecting a place and predicting whether it will be a good location or a bad one is a huge gamble. The aggregator platforms have successfully reduced the risk of failure because of poor location.
In India, platforms have specific strengths. Zomato is specializing in the discovery of restaurants, something that is way better than the telephone directory for them. Swiggy, on the other hand, has carved out its niche by focusing on food delivery only. So, if you want overall traffic to get diverted to your restaurants, both walk-in & delivery, Zomato will be a good option. If you are just a cloud brand, and delivery is your prime focus, Swiggy might be more ideal for you to go ahead and partner with. But, I still feel, both are necessary for your restaurant today (be it of any kind) because both are kind-of the ‘gatekeepers’ for a huge chunk of traffic and potential sales. How effective these platforms are? It depends, on your cuisine, location, target segment, dishes, etc. They can help you drive a lot of traffic to your brand, so partnering with them is definitely helpful to your business.
Aggregators in the food sector are definitely helpful for generating new leads for your food business. As Professor Scott Galloway of NYU has said specifically about Amazon, “It’s easy to sell products on Amazon but incredibly hard to build a brand or sustainable business on Amazon.” Followed by, “They [aggregator] sits on top of the dataset, and leverages that data and learnings to create their own private label brand, and Always! Always! is the [private label] brand put forward and owns the consumer relationship”.
We are seeing this already in Swiggy. Truffles (a local popular restaurant in Bangalore) has lost its top place from the ‘popular brands’ section to Bowl Company (Swiggy’s private label brand) and Domino’s (strategic partner). Homely, breakfast express, bowl company (all private label brands) get featured multiple times before even the first non-promoted listing of the restaurant is even visible (non-promoted restaurants first get displayed on the 10th page on Swiggy’s app). Every listing on Zomato is a paid listing, since it is a marketing platform, and unlike Google, it doesn’t show which restaurants listings are ads.
The easiest way to get featured on platforms is to give massive discounts. Once you give discounts, your listing gets featured before the “10th page” and more traffic gets diverted to your restaurant. This massive discounting is unsustainable in the long run and is unsupportive when it comes to brand building. Relying solely on platforms for a business generation would not be advisable in long run, as you may be making losses on per unit sale.
How to build a sustainable long term business online?
Your aim should be to spread awareness about your in-house ordering system to your customers and divert the loyal customers to your own website and delivery network. Building 1-on-1 relationships with your customers are the only way to build a sustainable business and grow in the future. I know it’s hard, but that’s the only way to build a sustainable and long term business. Loyal customers don’t buy your product just because you offer it at a very low price point. They buy, because they love your product since it has awesome taste, or they love your service because they know you, and believe in what you are doing. They may also buy because they had a great experience last time availing the services from you, and in many cases, they feel connected with you. It’s about building a good relationship with them.
… So why is a website important for your restaurant?
Because the only way you can build a good relationship with your clients is to be able to connect with them directly. Unless you know who your customers are, you will not be able to build those relationships the way other successful brands have built over a period of years.
Aggregator platforms do not let you get connected directly with your customers. They share the order details with you and don’t share the customer’s details. So, you are unable to get in touch with your clients and build those lasting relationships. Keeping the creator distanced from their customers makes the feedback loop open and builds a gap in the relationship that’s hard to fill over an open forum and the inability to reach customers directly.