We would like to introduce you to Jim Rand a former senior executive at McDonald’s. Jim has joined Acutely as a Senior Advisor. Needless to say, he brings with him a vast wealth of experience in marketing, consumer insights and new store development strategies.
Jim could you share some insights as to what your jobs entailed at McDonald’s.
I had a dual career at McDonald’s, with a 50/50 split between the Marketing and Real Estate functions. In marketing I was responsible for the consumer insight and strategy groups. I was the team leader for the cross functional team that launched the Value Meal strategy.
The evolution of this strategy allowed me to become a subject matter expert in menu board price tactics, a skill that I still consult on today. Our consumer insights group became a world class organization measuring consumer behavior and competitive intelligence. I spent my early years working with our real estate team with the responsibility to develop predictive models for new store locations and then completed my career as the Senior Officer for both US and Global Development. During that time, we opened 1,800 new locations worldwide on an annual basis and rebuilt 300 existing stores. McDonald’s was a continuous improvement company and we invested research dollars into new store development research. This learning allowed the company to build over 13,000 US locations and provided a roadmap to optimize locations in small towns, airports, malls and Walmart stores.
I also had the opportunity to work on the team that acquired new concepts for McDonald’s. The most successful of these acquisitions was the investment in Chipotle. We started our due diligence on Chipotle when it had only 8 stores in the Denver market. Our challenge was to determine what the potential would be across the US market for this brand. We took the 2 best Chipotle locations and modeled and identified trade areas across the US that had the same or better characteristics. We identified a significant number of potential locations and I am happy to report that Chipotle has actually exceeded that number of stores today. This was one of the truly great development strategies of the last 25 years and I am pleased to have played a part in this success.
When you began using data science at McDonald’s to select new real estate locations you were ahead of the time. How did come to realize the importance of the data McDonald’s had and how did you implement it?
McDonald’s franchises are fantastic operators, they also came to McDonald’s with significant business experience. They wanted to understand more about their business and the company responded by creating a center of excellence in real estate research. This function expanded its knowledge over time and I had opportunity to launch and manage this group for a number of years. Data quality continued to improve and we were quick to incorporate new information into our predictive models. We also identified the importance of site characteristics and store customer satisfaction reports as part of our models. Our motto was “Put the store where customer’s Live, Work and Shop, put the store where the customer can see it and get in and out quickly and build the store to deliver an outstanding customer experience on every visit”.
With Acutely combining forefront data analytics with site expansion, it seems that you two are a perfect match. What excites you the most about joining the Acutely team?
Mathew Focht, the CEO of Emerging and its many divisions, is a true entrepreneur with an incredible amount of both ideas and enthusiasm. He is undeniably good at identifying opportunities and structuring partnerships, and is one of the key reasons that brought me to this company. In addition to strong leadership, I’m also here because of their cutting edge technology in the fields of marketing, expansion, and loyalty building. No one else in the industry is really there. The opportunity to work with innovators and proactive thinkers is very important to me.
Technology really does seem to be taking on a larger role within every industry. In what ways do you predict tech will continue to push the restaurant industry forward?
I see automation continuing to expand, partly as an effort to reduce rising labor costs which is having a tremendous impact on the industry. Innovation in the ordering process as well as payment processes such as facial and license plate recognition will be increasing. Currently, some McDonald’s are testing license plate recognition that allows them to create a list of suggested purchases based on a customer’s previous orders and improve upsells. Ultimately, this technology may link a car with a customer’s credit card so payments will be automatic.
Currently, what do you see as one of the industry’s biggest challenges?
I would have to say that labor—both wages and increasing turnover—have placed a burden on restaurant operators. Now more than ever, staff incentivizing is becoming an important element in brand success. I actually worked in that area quite a bit at McDonald’s where we implemented sales contests and provided bonus systems for the crew. We also offered manager incentives based on financial measures.
One of Mat’s divisions, Tipzyy, is an example of how current technology can assist operators in this area. Basically, it’s a mobile app that educates and incentivizes staff. Any opportunities that those in the hospitality industries can pursue in relation to staff retention should be a top priority.
How does Acutely help with this challenge?
Restaurants and other businesses in the hospitality industry produce mass amounts of data. Acutely enhances the data produced by customers, transactions, and operations, and processes it. This raw data is turned into actionable insights that includes the best strategy for reaching different segments in the market place. When expanding, it also includes a look at local labor opportunities and challenges—a growing segment in data collection as labor challenges continue.
In addition, they have assembled best-in-class solutions for data-driven needs which include mobile apps, POS and reward systems.
The company really is on the cutting-edge of data-driven technology, and I look forward to progressing with them for years to come.