Marketing

QSRs' new Holy Grail: 1st-party data

Changes are afoot on the fast food marketing landscape in both traditional media and -- starting in 2022 -- on the digital playing field. The question is, has your brand got everything necessary in place to succeed given these profound changes in the making?

Photo: iStock.

April 9, 2021 by Dennis Becker — Ceo, Mobivity

https://www.qsrweb.com/companies/showcases/mobivity-inc/There was a time when QSR brands didn't need to know who their customers were. They could drive same-store-sales increases simply by buying enough target rating points in television to achieve a decent share-of-voice with consumers, run a quarterly freestanding-insert filled with coupons and deliver a good product.

But two significant events have changed that game for QSRs since the pandemic.

The first game-changer was the COVID-19 pandemic and its impact on QSRs. I'm not talking about impacts like closed dining rooms and consumption shifting to off-premise. Instead, I'm speaking on the Olympics cancellation, the drop in ratings for NFL viewership and cord-cutting consumers. The traditional media options QSR brands counted on to deliver large audiences for decades can no longer be counted on — and should be reconsidered.

The second game-changer was the recent announcement by Google that they will no longer allow third-party cookies or the targeting of individuals based on browsing history. This impacts the number of guests frequenting their establishments.

This is a big deal for QSR operators and should be a concern that needs to be addressed now.

With the declining effectiveness of traditional media channels and the shift of diners to digital everything, QSR brands have shifted their media spend to digital channels. According to Kantar, McDonald's broadcast spend has dropped by half in the last two years, while digital spend grew more than three times. Wendy's digital spend is up more than five times.

"This is a big deal for QSR operators and should be a concern that needs to be addressed now."
-Dennis Becker

Now, targeting consumers who visited competitors or indicated a craving for QSR food based on web-browsing or third-party data will soon be over. Google made it clear in their announcement that they "will continue to support first-party relationships…in which they have direct connections with their own customers." That makes the building of QSRs' own audience of customers — also known as "first-party" data — an imperative.

QSR brands that build first-party data gain far greater control over their marketing. They can break away (and gain more control) as they are no longer wholly dependent on broadcast television networks or Facebook to reach and stay top-of-mind with their customers. When ad rates go up or ratings drop, no big deal. When they have their own "owned" media channels, such as text messaging, email and apps, they can be in control of when and how often they connect with customers.

If you are a QSR, how should you approach building owned media channels powered by first-party data? Here are five tips:

This isn't just for the big players. Most digital platforms operate as a Software as a Service (SaaS) offering. Building and operating an owned media channel is simple enough for a single-restaurant operator yet sophisticated enough to power a brand operating 500-plus units. Platforms store customer data, so you won't need an IT department to get up and running.
You don't need an app to collect first-party data. You might assume that digitally savvy consumers expect you to have an app to convince them to give up their information. Unfortunately, that's not practical for every brand, and studies show that a quarter of consumers abandonan app after the first use and most apps are deleted within the first week. You have many ways to collect customer data, including text message marketing programs, email promotions and loyalty programs, which all give you valuable first-party data without the cost, effort and challenges of building an app consumers download and use.
But do make it compelling and easy. Let's face it, there's not a compelling reason for guests to fork over personal information. Give them a reason, including receiving periodic deals and promotions, including an initial sign-up bonus such as a free item with purchase. The goal is to remove as much friction as possible. Far more consumers will text to sign up than download your app and register.
Don't put all of your eggs in one basket. Some QSRs want to force customers into a single channel their marketers prefer, such as email or app. But our review of data from millions of consumer redemptions shows there's virtually no overlap between consumers who redeem email, text and loyalty offers. This means you need to reach customers in the channel they prefer, which varies by guest.
Adopt a 1:1 mindset. Collecting first-party data allows you to reach your guests effectively, with the right message at the right time. Your owned media channels, such as a text messaging program, reaches a highly-curated audience of people who love your brand. Don't treat your channels like mass-marketing broadcast channels where you send the same message to everyone at the same time.

If you've been waiting on the first-party data sidelines, the two developments outlined above should be enough to convince you it's time to act now. Google's new rules go into effect in 2022. You must act now to start building first-party data and control your marketing destiny.

Dennis Becker is CEO of Mobivity, the text message marketing platform built to help restaurants eat their competitor's lunch.