Ashley Bray -July 6, 2021
Effectively, there were two Independence Days this summer—the national holiday and the day your local government granted bars the freedom to fully reopen. As the country still recovers from the pandemic shakeup, however, bar owners may find their customer base breaking up into two camps: Those excited to return to their pre-pandemic joie-de-vivre, and others who may be a little hesitant to go back. The big question now is how to welcome these very different customers back to the party.
“Bars and restaurants definitely want their business to pick up the pace, now that everything is open,” says Divya Thakur, a CMO at Cerebrum Infotech, a Product Development Company. “Ridesharing and [taxi companies] have an important part to play in helping bars and restaurants boost their business. In the U.S., especially after the pandemic, owning a car is getting too expensive due to the high prices of insurance and parking spaces. This is when rideshare and taxi services come to the rescue. Who wants to drive in high traffic? Uber, Lyft, private cab companies and custom apps (developed by our company for clients) are a great motivator.”
Kurt Brendlinger, CEO of Los Angeles-based Freebird, credits an exchange between himself and a waitress for inspiring him to reflect on how he could bring together technology, social responsibility and smart, targeted marketing. When having a drink in a Palm Desert bar, he asked his server advice on where to go to dinner. When he asked about her favorite spot among the three she first suggested, she recommended the restaurant offering free car service, noting that the experience made her feel like a VIP. Now, he insists treating customers like VIPs can bring them out of their cocoons.
“A loyalty strategy like this results in an acquisition of a new customer and an opportunity to take care of the best customers, which inspired me to create the platform,” he continues. “As regulars will probably not go to your bar every single night, you have to figure out ways to stand out from the competition. This added benefit, meanwhile, makes new customers feel special, like a VIP.”
A Well-Engineered (Sales) Vehicle
Rideshare tie-ins, of course, are as old the big rideshare firms themselves, as they provided the perfect adjunct to safe driving campaigns initiated by liquor companies and distributors. Their effectiveness in building brand loyalty continues as their products reinforce positive, responsible behavior when enjoying a night out. Johnnie Walker’s collaborations with Uber nearly a decade ago exemplify the idea. Across the Atlantic, it teamed with Uber to offer rides to thousands of bar customers in the UK and Scotland. In the U.S. around this time, display ads on the Johnnie Walker Facebook page encouraged customers to take a pledge to not drink and drive. It reinforced the message with a counter keeping track of the growing number of commitments to the pledge and safe rides taken by customers. In both cases, the giveaways (free rides) enticed consumers to embrace and share the brand’s social responsibility efforts.
As we roll into the post-pandemic era, bars and liquor companies are already betting that on-premise promotions—new product launches, special dinner/pairing events, fundraisers, and cocktail-making classes—have the potential to bring in old and new customers as they did before the pandemic. While they offer many extra perks above and beyond a fun night out, bringing a rideshare service into the mix in this climate may power up that extra incentive to get customers back out to sip and socialize after more than a year of sheltering in place or dining outdoors with their small “pod” of close friends.
One recent post-pandemic example was Seagram’s 7 Whiskey’s Los Angeles kickoff of its “Keep the Dive Alive” campaign at the Gold Room less than a week after California’s governor, Gavin Newsom, officially opened the state back up for regular business. The kickoff previewed National Dive Bar Day (July 7) and teamed with a three-week charity campaign to raise funds for Main Street Alliance, a nonprofit organization supporting small businesses, including dive bars. During the campaign, every customer share of “Keep the Dive Alive” content on the Seagram’s 7 Instagram would generate $7 (up to $77,000) for those businesses in need. The event also had the components of a highly effective on-premise event, from a celebrity appearance (comedian/actress Iliza Shlesinger) to a cocktail-making class with some of the new and classic Seagram’s 7 whiskies and beautifully crafted vegan snacks.
A discount code for a rideshare round trip to and from the Gold Room sealed the deal for many of the revelers attending. For some, it ensured they could enjoy their first big night out responsibly at one of the city’s most popular dive bars. Others had the peace of mind knowing they could experience the Gold Room without having to deal with Los Angeles traffic or the challenging parking in the trendy Echo Park neighborhood.
“Rider demand is at an all-time high for Uber and Lyft as the country has rebounded,” affirms Dillon Tedesco of Octopus Interactive, the largest network of interactive screens inside Uber and Lyft vehicles in 50+ markets across the U.S. and Canada. “Consumers use rideshare primarily for social outings, which present opportunities for targeted, interactive advertising campaigns for the food and beverage industry to take advantage of.”
Get Your Meter Running….
Seth Lytton, Chief Operating Officer of The Detroit Bureau (a respected automotive trade outlet tracking automotive business trends) observed there are days, times, and occasions that will prove more advantageous when using a rideshare promotion to get a variety of customer types out of the house—even in states that are still maintaining fairly strict mask-wearing protocols and other safety measures.
“Some states are more liberal with mask wearing than others, which means some states will be more successful than others at getting people out of the house,” he says. “In states [where customers] are more excited for reopening, like Utah, ride sharing could skyrocket. A similar customer base in states like New York will likely be more hesitant about going out, given some residual risks coming from newer COVID variants. In either case, providing rideshare codes on off nights may be great way to coax people out of their homes and to your restaurant or bar. As integrating a rideshare offering into a promotion is an investment, I suggest contacting active rideshare companies in your area, especially as some may be open to offering discounts to prospective bar/restaurant clients in exchange for promoting the rideshare services.”
Cerebrum Infotech’s Thakur, meanwhile, advises that in order to select the right rideshare or cab company, a bar owner or manager should first establish a budget for the overall promotion they are planning and share that info with them. To do their due diligence or “market research,” an owner could survey employees, customers, and other neighboring businesses about the idea of promotions including codes for rides or cross-promotional opportunities with the ride share company. Alternatively, the owner or manager can work with a firm like Cerebrum Infotech to incorporate a ride-sharing app feature within its own app to make the process of calling for a ride home easier and less expensive.
“There are many possibilities when it comes to how bars and restaurants can use [rideshare] services to increase their business,” says Thakur. “[In loyalty program fashion], they can send regular customers app coupon codes to use while hailing a ride for transportation to and from the restaurant or bar. Venues hosting cooking and cocktail classes can offer special discounts to users to hail a cab as a part of the evening’s package. They can also collaborate with the premium spirits companies [through local brand representatives and distributors], local craft distillers, and mixologists to develop ride-sharing incentives with social media tie-ins. If your promotional budget permits, you can regularly host marketing events with rideshare codes factored in. If the budget doesn’t permit, you can still promote your business on social media, telling people about discounts when they ride a particular cab or ride-share company to reach the restaurant or bar.”
While Uber and Lyft are the predominant rideshare companies in many U.S. states, some argue that customers should be able to choose their preferred service. Brendlinger also points out that liquor companies are not actually allowed to by law pay for any ride compensation to a bar or restaurant—though they are allowed to give a ride home to customers. To cut th e confusion for bars and restaurants and make the process easier and legal for all involved, his company’s platform enables liquor companies to legally provide bar customers safe rides home.
Brendlinger says the platform is a two-way platform where bars and restaurants can subsidize rides to their establishment and alcohol suppliers can subsidize safe rides home. “Funds are allocated from ‘social responsibility’ budgets to pay for and promote safe rides, and our platform is made for bars and the liquor industry to supplement money for those safe rides home,” explains Brendlinger. “For example, if I owned Kurt’s Bar and wanted to offer customers rides home, I would use the Freebird platform, which allows bars and restaurants to put money onto our app to create a ride subsidy for the customer. Freebird has an agnostic platform that sits on top of Uber and Lyft and lets the consumer pick which company they prefer to use. The customer will click onto the Freebird app and notice which bars and restaurants in their area are offering to contribute to the costs of the ride. From there, they either pick Uber or Lyft to go to the bar or restaurant that has made an offer.”
As Freebird is customizable, it is up to the manager or owner to figure out how to get word about the benefit out to a select group of customers via a database or master list indicating who the most regular customers are. “You can think of it as a go-between to help bridge those gaps and make it possible for a restaurant to get word out to the customers,” he says.
Providing customers an alternative in limited parking situations is another incentive for rideshare use, according to Jonathan Fine, owner of Fine Entertainment (which has 11 Las Vegas-area bars under its banner) and a co-founder of Uber OOH. Local bars and restaurants, meanwhile, stand to benefit from the official Uber advertising network, as it enables them and other advertisers to keep customer messaging and connection consistent via high-quality, real-time connected digital advertising.
“The parking situation in Las Vegas is problematic, the rents are too high, and existing lots can’t hold enough cars,” says Fine, who says that at his PKWY Tavern Taphouse & Grille, Uber was chosen for its ease of use for managers overseeing the account as well as its mostly millennial customers. “When I looked into my rideshare promotions, I was looking at the safety of my patrons from a drinking and driving perspective. I also realized I was freeing them up from the struggle of finding parking spaces.”
His company was moved to develop and release a loyalty app tracking people’s experience inside the bar from their arrival to the time they wanted to leave, and he found it ended up being one of the most successful marketing campaigns for his bars. In this case, if a customer has three drinks or more, it triggers the app to send them a push notification with this messaging: “It looks like you’re having a great time. We’re very happy. Please let a manager know when you’re ready to go home, and we’ll pay for a ride.” At the venue, which has an account with Uber, the manager on duty will be alerted to call an Uber for that customer when he or she is ready to leave.
“It’s still going strong today, and it is based on ensuring their experience from start to finish is great, providing a reason for them to come back,” he says. “Safety is part of that equation, and if customers know that the management cares about them and their safety, free or discounted Uber rides deliver a meaningful incentive. On top of that, we train our servers to know that when a customer orders more than three drinks, they should recommend the bar offers a ride home.”
Driving the Point Home
Customer demand is clearly there, but Brendlinger clarifies that in a normal (pre-pandemic) environment, everyone’s competing for business. By encouraging customers not to drive, an owner or manager can potentially increase ticket size through the purchase of more drinks, which makes the investment in rideshares for customers worth it. While this is a promising prospect in the immediate, things will ultimately shift in the other direction. And with this, he advises owners and managers to look at the long game.
“We’re seeing two trends in Austin, Texas (our post-COVID relaunch city), though they will probably be short-lived,” observes Brendlinger. “One is that customers are coming back and many of the bars and restaurants are seeing 120% increase level in sales compared to pre-pandemic. Even with that, however, they are also affected by the shortage of labor, forcing some places to shorten business hours. As things normalize in the hospitality landscape going forward, however, the focus should return to the needs of both new and loyal customers.”
“Incentivizing consumers in a unique and interactive way when they are actively going out and riding responsibly, provides bars and their alcohol distributors an opportunity to engage this audience in a measurable way,” says Tedesco. “The use of promotions, especially when attached to higher-margin items like alcohol, is a powerful strategy to drive on-premise traffic. The majority of our partners operate at the national level, with brands like Red Bull, Jose Cuervo, and Budweiser looking to reach an audience of 21+ consumers who have the disposable income to drive in-store revenue. However, as rideshare apps [are big in] every city across the country, we are able to deliver market-specific campaigns with a variety of different creative and targeted offerings.”
Tedesco affirms that many food and beverage brands working with Octopus lean towards unique promotional activations that tend to be, “more memorable and have a higher impact than what they are running through more traditional channels.” Furthermore, investing in unique incentives, promotions, and sweepstakes drive much higher engagement rates and interest with a bar or restaurant’s customers. Octopus Studios, the company’s in-house creative agency, works with its partners to create completely custom content (games, surveys, trivia, etc) or to optimize existing advertisements with call to actions and interactive opt-ins.
On a more practical level, owners or managers should not have an open-ended budget for rides, as it may create a situation where some customers will get bigger discounts than others. Owners should look into platforms where the bar or restaurant can work within its budget to ensure everybody gets the same cash back while keeping the restaurant on budget by tying it to confirmation of a sale via the credit card linking.
As the bar and restaurant industry is very competitive at this moment, with millions of consumers hungry to get back out, Tedesco suggested that businesses using the Octopus platform provides an opportunity to stand out from the competition and reach consumers during a pivotal moment of their daily journey.
Even with this assist from app technology rooted in common sense, weaving rideshares into on-premise promotions may not alone ensure the road to pandemic recovery will be smooth. However, they can ease the impact of speed bumps for bar owners and their customers along the way.