Technology

Nathan's Famous tech transformation: Serving customers 'where, when and how' they want it

After a solid 102 years in existence, Nathan's Famous — one of the few U.S. brands around for the last pandemic in 1918 — has made a timely tech transformation that shows that just maybe older really IS wiser.

After 102 years, one of America's oldest QSR brands transforms itself into a tech powerhouse. (photo provided)

April 30, 2020 by S.A. Whitehead — Food Editor, Net World Media Group

When restaurateurs speak about brand transformation, it brings images of new logos, storefronts, interiors and other physical displays of the look and feel of a brand. But for one of the oldest QSRs in the nation — and one that was actually around during the last pandemic — Nathan's Famous' brand transformation has been a sweeping technological makeover designed to keep leaders in the restaurant instead of on planes or in meetings. 

In fact, when QSRweb first reported on this ground-up tech transformation on April 7, we were so bowled over by scope of the undertaking, we had to get a closer look. Thankfully, Nathan's Famous Senior Vice President of Restaurants James

Nathan's Famous Senior Vice President of Restaurants Nathan Walker. (photo provided)

Walker, set aside some time to walk us through everything from the new gadgets and services the system is implementing to the goals behind the investments and where Nathan's Famous leadership wants to end up as a result of the improvements. 

As you read through the following, detailing the brand's actions around the year-long multi-dimensional effort, you might get the same feeling we did – namely that Nathan's Famous must have some sort of crystal ball or time machine. That's because the brand's timing with these technology-based initiatives has been uncanny when it comes to meeting the needs that erupted almost overnight of a sheltered-in-place populace and the restaurant employees serving it.

In fact, one of the things the brand's leadership was wrapping up when the entire national business world shifted to work from home in early March due to COVID-19, was an improved system of virtual meetings. How's that for kismet?

"We have been focused on internal systems for about nine months … so we actually pushed the restaurant team to virtual and had folks stay home as much as a week before any of our contemporaries in New York did," Walker said about the company's virtual meetings, which are now standard for the New York City-based brand. 

"As we morph from this culture that's very focused on the office, to one that's focused on the restaurants, (the brand's) technology had to work along with that."

-Nathan's Famous Senior VP, Restaurants James Walker

The transformation wasn't easy, said Walker, who pointed out the physical snafus that meeting virtually often presents — unexpected intrusions, distracting backgrounds and noise, the propensity for participants to all talk at once or just a lack of a solid set of virtual meeting ground rules.

But the virtual meeting initiative at Nathan's Famous is emblematic of how the brand sees its systemwide use of technology as a whole going forward. Walker said that the tech is just a tool to allow it to deliver food at the time, place and way customers want it. 

"It's part of our overall philosophy … as an organization," Walker told QSRweb. "I wanted the team to be very agile and able to move from project to project, wherever it was. … It felt inefficient to say, 'I need you to jump on a plane so we can sit in an office to talk across the desk'

"I'd rather they be where the business is — out in the restaurant, working with franchisees, working in new markets. … So, as we morph from this culture that's very focused on the office to one that's focused on the restaurants, (the brand's) technology had to work along with that."

The beauty of big-time 'buy-in'

One thing that Walker emphasized about these types of initiatives is that they don't work for franchise-based brands without system-wide buy-in from employees, franchisees, leadership and every other player. That means everyone must be willing to invest what's needed to bring franchisees' systems up to speed.

Nathan's Famous' new kiosks for customers in a hurry. (Photo provided)

"So that commitment from the executive level that, 'Yes, we're going to use this technology, and yes, I'm going to make sure you, the team member, have the right software and have the right hardware to make this functional' … is critical," he said.

Aside from the virtual meeting tools, the bulk of the remaining tech transformation at Nathan's Famous is much more obvious to the brand's customers. Some of the components include: 
•    POS revamps with Toast and Par Technology Corp.
•    Self-ordering kiosks with Toast (now in tests nationwide). 
•    Back-office software with RestaurantMagic for inventory, food management, labor/scheduling, reporting and analytics. 
•    Customer data collection and in-restaurant Wi-Fi via CloseComms SaaS platform.
•    Targetable for AI-enabled ad and messaging creation and distribution. 

"These changes allow (for the) consumer to experience the brand in the way they want to experience it," Walker said.  "So if that means on their mobile device, so be it. … If that means they want to come into the restaurant and order, or use a kiosk, that works, too. … We're not pushing the guest in one way or the other to say, 'This is the way we want you to go, as a guest of Nathan's Famous.' We're saying, 'You choose what's right for you, and we'll allow you to use the best way to experience the brand in that way.'" 

The tools that the brand is using to enable that kind of service, not only include CloseComms' ability to lift the curtain on customers needs and desires, through the extension of in-restaurant Wi-Fi with app integration, but also the AI-facilitated ads created and distributed by Targetable. Targetable is using artificial intelligence to find out what individual customers are in the market for and then communicating with them in ways that bring them in to order. 

"Targetable is not only very efficient from a spend standpoint, it's very quick to market," Walker said. "Targetable allows us to move much more rapidly, and accurately than we would be able to without the Targetable solution."

Agility, adaptability — a restaurateur's new buzz words

Examples of Targetable-created promos at Nathan's Famous. (Image strip provided)

Keywords you'll hear Walker mention when discussing this total initiative are not just around customer personalization, but also that overall brand agility and adaptability.

"With 'agility' meaning we wanted to be able to move fast to new markets, new countries, new locations, new business streams — all with a great deal of speed …" he explained. "And then maybe the most import — from a business standpoint — is we want this all to be adaptable. That meant we wanted to bring multiple partners — whether it be Brink, or Targetable or Restaurant Magic … and all these tech providers had to play well with one another, communicate and work well together as part of our tech ecosystem. 

"And 'adapt' also meant that, while we believe we're coming up with something that's truly cutting edge, it won't be cutting edge for long, so are we able to grow as tech grows?"

For franchisees, of course, all these new tools require not only that aforementioned 'buy-in,' but also some investment on their parts, along with the money the company is rolling into the endeavor. Walker said the franchisor must prove that their actions are primarily designed to make franchisees money by making customers happy. 

"Some of this tech is draped over the entire franchise system. So the remote ordering platform which is under construction, our app, membership program with Punchh, a lot of these programs are provided by the franchisor," Walker said. 
"The POS  platform is at cost … we don't add markup. And it's where franchisees can chose Toast, which is a lower-cost platform, or Par, which is a more enterprise-type program. We selected those two providers specifically to allow our franchisees to choose the tech suite that made the most sense for them." 

What success 'looks' like

Success will be gauged as the brand measures its efforts going forward. Some of that is built into the systems, like Closecomms technology, which provides real-time feedback on consumer patterns daily and over time. 

One of the things being measured is the success of the meal kits the brand announced April 13, which was put in the works long before the world knew a pandemic would derail things for the restaurant world.

And in relation to the meal kit launch, we wondered if it might be time for Nathan's to offer healthy, plant-based options that were gaining in popularity before pre-pandemic. Walker's response indicates that he expects some changes in those trends in the days ahead. 

"So that's my favorite question you've got, and let me tell you why," he said, with what seemed like an air of indignation. "Now, I can only talk about my family, but I can tell you that … when the quarantine lifts, I am not going out and looking for a kale and quinoa salad. And I'm a very health-conscious person. But when I go out with my family, I can tell you we are going to go to Nathan's Famous and get a couple of cheesesteaks. And we are going to want to go to Chick-fil-A and get a chicken sandwich. We are going to want American comfort food — those are the things we are going to want to experience."

Will the rest of America also feel that way? Hard to say, but considering Walker's track record thus far on predicting 2020 industry trends, those sentiments might well be worth further consideration.

About S.A. Whitehead

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Pizza Marketplace and QSRweb editor Shelly Whitehead is a former newspaper and TV reporter with an affinity for telling stories about the people and innovative thinking behind great brands.