There are a lot of factors decide the success of a bar or nightclub. While there’s no one-size-fits-all model that works across the board, there’s one element that has a direct impact on every business’ success: data and the ability to pull insights from that data.
Your data is the key to understanding what builds your business up and what tears it down. But data in and of itself is overwhelming and lacks direction. That’s where insights come in.
Insights are the story behind your raw data points—the why behind the numbers. When you have insights you can take action. And it’s that action that continues to propel your business forward.
The good news is it’s no longer complicated to track, compile, and understand all your data from across your venue to create your own personal insights storyboard. There are solutions built specifically for nightlife venues that automates all of this for you, so you don’t have to be a data scientist to figure all this out.
Here’s how you can use your insights to boost your results.
1. Make your nights more predictable.
Today’s Reality: Few venues today have an accurate idea of what each night will hold. Doors open, guests walk through, and the night happens. At the end, you pull your reports to see what performance was like. It’s an incredibly unpredictable model, which makes it hard to understand how your night will translate to revenue, operating expenses, and overall profit before you open for business.
Data’s Fix: The key to measuring the success of your venue and getting it to a point of predictability is knowing exactly how you’re performing. That means knowing your numbers. You’re likely already doing this with your end-of-night reports. However, they’re a reactive look into how your night went, and they’re often presented in a spreadsheet format that you need to make sense of for them to be useful.
Other numbers to know are your staff productivity, your product inventory and its sellable rate, and your guests’ actions throughout the night. Without data on any of these items you’re spending every day guessing until you’re no longer able to make ends meet. But just having the raw numbers alone isn’t enough to drive long-term success.
Insight’s Power: Long-term success comes when you understand the why behind the numbers. That’s what insights provide. They’re powerful triggers that you can leverage to build even more business.
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Which staff member has the highest upselling rate? Assign them to your best VIP table or schedule them during the highest selling hours behind the bar. Does your main bar get so slammed at 11:30 p.m. that you’re over capacity and no longer churning drinks at the rate you need to make money? Consider opening a pop-up bar at another location at that time to speed up your flow and increase drink orders. What can you expect in sales this Thursday based on the past four Thursdays’ results? And how does that compare to your Saturdays? These are the questions you’ll begin to have answers to, and with those answers come smarter decisions to make even more money.
2. Shine a spotlight to decrease unnecessary costs.
Today’s Reality: When your nights are unpredictable, you tend to get stuck in the rut of doing the same thing day in and day out. This tends to be out of habit and out of your actions appearing, superficially, to be working.
Data’s Fix: Without data to back your actions, the reality is you don’t know what is and isn’t working to get guests through your door and spending money. You end up operating blind and oftentimes spend too much of your money on activities that aren’t working or, worse yet, cause you to lose money.
Insight’s Power: Data gives you clarity on your actions. Insights empower you to make smart decisions about the data that’s presented. For example, you see in your end-of-night reports (i.e., raw data) that you’re breaking even with your overhead and sales, but your overall sales seem on par with what you’d expect. When data is presented as a storyboard, you get insights into the different factors causing this.
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Rather than comparing spreadsheets, you now clearly see that you’re staffing for far more guests than is realistic at 8:00 p.m. when you’d be better off allocating those staffing needs until 11:00 p.m. Maybe you realize you’re paying your promoters a per-guest fee when the guests they bring in don’t end up spending any money once they’re inside your venue. These insights allow you to know where you’re overspending and cut costs accordingly.
3. Improve marketing efforts.
Today’s Reality: Speaking of knowing where you’re overspending, marketing is one of those places you’re likely throwing money in the wrong places. You have a general idea of which channels to market on: social media, in-venue specials, text messages. But you’re not sure which actions are actually driving people through the door while simultaneously earning you more spending per guest.
Data’s Fix: Marketing is incredibly measurable now, particularly with digital at the forefront. When you track your marketing efforts you’re able to see exactly what drives traffic and results. So, while a third-party website may claim to have garnered you 100,000 impressions, you know that it actually only got you 3 clicks and $0 in return. Now you know not to spend money there in the future and redistribute those dollars toward activities you know work for you.
Insight’s Power: With insights, you can take your marketing to the next level and distribute personalized, habit-based promotions to each individual. Think like Amazon or Starbucks, each of which send individual consumers messages that are based on their buying habits.
Notice that a guest typically drinks a Rum and Coke rail drink? Send them an offer to try a rum-based signature cocktail you think they’d like. Notice a guest hasn’t attended your venue in several weeks? Reach out to them to get them back. Notice it’s a guest’s tenth visit this month? Give them a reward or upgrade them for their loyalty.
When all your data is combined into one system and works together to tell your personal story, you get to see insights on how your guests’ habits affect your sales, inventory and staffing needs. This story (also known as your insights) is what empowers you to make data-driven decisions that boost your business even more.