In this episode, Hamed Mazrouei, founder of Vivant and Milagro, discusses his dual-focus approach to helping restaurants achieve consistent internet connectivity and exceptional customer retention. He explains the critical importance of preventing network outages to maintain seamless online operations and increase revenue. Hamed also shares his insights on why customer retention is vital for the restaurant industry and outlines practical strategies for encouraging repeat visits. Through his companies, Hamed aims to drive top-line revenue growth and ensure restaurant success by solving connectivity and retention challenges.
00:00 Introduction to Hammed Ri
00:14 The Importance of Internet Connectivity
02:40 Cost and Benefits of Reliable Internet
05:48 Customer Retention in the Restaurant Industry
07:55 Strategies for Enhancing Customer Retention
14:39 Conclusion and Contact Information
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Jeremy Julian (00:00):
So Hammed, why don't you introduce yourself to
our audience Who is Hammed?
a lot of people have seen you'cause you're, you've got the,
you've got the look, but, and alot of people are like, who is
that guy?
But I'd love for you tointroduce yourself to our
audience.
Absolutely.
Hamed Mazrouei (00:11):
So my name is Hamed Mazrouei i'm the founder
of, Vivant and Milagro.
So I run two differentcompanies, focused one side on,
connectivity, eliminatinginternet outages, providing a
hundred percent uptime guaranteethrough what we call a half
platform, highly available,fault tolerant.
All that means is we justeliminate internet network
outages in order to ensure thatyour online orders, your third
(00:34):
party orders, payment processorswait list, reservation, none of
that goes offline, so you don'thave to deal with the
complexities that comes withoutages.
So that's on one side.
And then on the other side, wefocus on retention.
Like restaurant industry hasn'treally fully, got that under
control, I think and I stronglybelieve that by end of the
decade, I've said this severaltimes, that there's gonna be
(00:56):
some billionaires that maketheir billions in the restaurant
industry, and they're gonna doit through customer retention.
So those who master that aregoing to increase revenues,
which then who cares if foodcost is 35% and labor is 35%, it
doesn't matter.
Even though you took a 10%,increase in, in cost of goods
sold and labor, it's not gonnaimpact you much and you're never
(01:17):
gonna have that thin marginissue.
Jeremy Julian (01:19):
Yeah, no, and I've listened to you talk, for a
while about the whole idea ofgas retention, but.
Let's dig in.
So I was actually just on thephone this weekend with a
customer talking about exactlywhat you had shared with them.
They're now at 70% of theirorders are coming in digitally.
So internet has played such acritical role.
And the reason I was talking tothem is they had did a reference
(01:39):
call and the customer had said,what happens when the internet
goes down?
I say, ostensibly we have aproblem.
It's not'cause the point of salethat we sell is the problem.
It's ultimately because.
Third party delivery kiosk, allof these other things are
operating on the internet and ifthe internet's not stable.
So what have you seen as you'vebeen in this connectivity space?
'cause you've been doing thisfor a while.
Hamed Mazrouei (01:57):
Oh yeah.
We've been doing that for about15, 16 years now.
So
Jeremy Julian (02:01):
early days it didn't matter as much.
it was critical, but it wasn'tas
Hamed Mazrouei (02:04):
critical as it is now.
I agree, nowadays, everything'sonline, like everything and by
the way, 2019 okay maybe youlose 10, 15, 20% of online
orders'cause the, you justcouldn't.
But today it's probably 30, 40%of your revenue and it's so
inexpensive to do that, to justkeep the network up and running
at a hundred percent with nooutages, that it's just, it
(02:27):
doesn't make any financial sensewhy you should not be doing
something like this and again,it's anything that takes away
from that top line revenue putsyou in that thin margin
situation, you can't afford todo that.
Jeremy Julian (02:40):
and the one thing that people underestimate,'cause
oftentimes, and I'm sure you runinto this, so for those
listeners that are out therethat are like, oh, but it costs
too much to have a, have aninternet connection, I.
a secondary internet connection.
An SD-WAN a highly available,it's too expensive.
But when we talk about what theylose for an hour of sales, even
if they're only making 20% onthose hour of sales, one hour of
(03:01):
downtime can pay for it.
So talk us through howinexpensive it and how
affordable it's gotten'causeit's not even inexpensive, it's
affordable, especially when youlook at the opposite side of it.
Agreed.
Hamed Mazrouei (03:10):
It's a thousand percent affordable.
You don't have to go for therestaurant space itself, you
don't have to do thecomplexities of SD-WAN and go
through all that expenses.
You just need somebody who'sdone this before, who knows what
they're doing, and who cancreate an infrastructure that
just keeps that businessessential services online.
That's what we say, and it's sogood and it's so real it's so
(03:33):
good it works so well that ourcustomers don't even know.
So the fir, so we get obviouslyproactive notifications.
we call the customer first andsay, Hey, by the way, FYI, you
on backup.
Don't worry, we've got itcovered.
We're calling the ISP.
We're trying to sort that out.
And they're like, no, Internet'sworking.
It's no, it's not working.
no, they're arguing, it'sworking.
It's trust me, it's not working.
You're on backup.
(03:53):
in terms of cost, you arelooking at probably sub 400
bucks a month per location, permonth for a primary internet
connection, a backup, afirewall, the wifi, the, PCI
compliance, the intrusiondetection, all the security
stuff, the content filtering.
Like right now, most restaurantsare probably paying around 500
(04:15):
bucks a month without the backupand without all, and without the
proactive
Jeremy Julian (04:18):
services, without all of those kind of things.
Hamed Mazrouei (04:21):
So and so for you lose that sale.
It's,
Jeremy Julian (04:23):
it,
Hamed Mazrouei (04:24):
yeah.
It's gone.
Yeah.
Look, you're, you are morelikely to save money by
combining it and putting it in abundle and getting that a
hundred percent off time andeliminate all your outages than
it is not doing it again.
It's just mind boggling how somepeople are like, oh, it's gonna
cost me 50 bucks a month to dothis, and I'm just not willing
(04:45):
to do that.
It's it's$600 a year.
You lose a one, you loseinternet during lunch or,
Jeremy Julian (04:51):
dinner.
You're done.
and you get the argument, oh,but at my house it never goes
down, and I laugh'cause I'mlike, yes, you're number one.
Oh, so you can't watch yourNetflix, so you're upset about
it at your house.
Like you can't process creditcard, you can't process a
loyalty transaction.
You can't process an onlineorder or a third party delivery
order when you have no internet.
Yeah.
So people don't think throughthat.
(05:11):
So is that a common thing thatyou guys continue to run into?
Hamed Mazrouei (05:13):
not really anymore.
I think people are waking up toit and they're saying, okay,
like I, I actually need to makea change.
And that's becoming, it's slowlybecoming a norm.
so I think people are realizingthe pain point and they're
starting to, take a stance of,Hey, how do I just ensure it
never goes down?
And how do I keep it, affordableso that I'm not spending a
(05:35):
thousand bucks a month?
love that.
And by the way, there arerestaurants, like we've got some
customers that are spending, 13,1400 bucks a month, but your
AUVs are five, 6 million bucks.
And it's Hey, I don't care.
I just don't want to lose thatrevenue.
Jeremy Julian (05:46):
Yeah, I love that.
let's flip the script realquick.
you talk about retention and whydo you think that retention is
such a critical piece of therestaurant equation?
again, you've been in therestaurant space for close to 20
years now and Yep.
I think, and you and I bothkinda live in a similar part of
the country where.
The restaurants are abundant,but it feels like less people
think about that.
(06:07):
But why do you have such apassion to ensure that people
retain their customers and getthem coming back?
Hamed Mazrouei (06:12):
Yeah, so the story begins from when I, story
begins in like 2010 and actuallythere was a news article or
some, one of these magazines, Ithink fast casual QSR online
published a thing that I hadsaid in 2013.
And I went back and read itmyself.
I'm like, whoa, who said that?
(06:32):
And it's oh, it's by me.
So it started back then and itstarted with the guys at Gena
Squirrel, and I was sitting, Ineed the sea levels.
I was in their meetings everyMonday, 7:00 PM until whenever
it ended.
And I saw the problems at thehigh level and I started asking
my questions why?
Like, why is I.
You, you are selling a margaritafor 12, 13, 14 bucks.
(06:55):
It cost you a dollar.
That's a hell of a margin.
Like what other industry do yougo to where it costs you a
dollar?
You sell it for$10, right?
10 x.
Jeremy Julian (07:04):
Yeah.
Hamed Mazrouei (07:04):
That's crazy.
Margins.
But then everybody'scomplaining.
So I start asking, why does itdo that?
And then it's they're not reallymarketing.
Or if they're marketing likethey were back in the day, those
guys crushed it.
they, the guys at Genis likethat, I remember they had 2.2
million people in their emailsubscriber list back in 2010.
Oh my
Jeremy Julian (07:23):
goodness.
Okay.
In 2010,
Hamed Mazrouei (07:24):
right.
And it was antiquated.
You write your name, email on apiece of paper, it gets scanned,
it gets sent overseas, and thenthey manually type it, put it in
a spreadsheet, send it back overto the, it just, it was
complicated, but that's whatthey did to crush it.
But everybody, first Tuesday ofevery month got kids eat free.
And I always used to make fun ofv not make fun of him, but get
(07:46):
in a conversation and be like,Hey, I don't have kids.
Why do you send me kids?
Eat free offers.
And he would just shrug it off.
We like, that's all we could do.
I'm like, no, you can actuallypersonalize it.
So closing the loop on that 70%of people that go in the
restaurant never go back.
Uhhuh.
There's a reason they don't goback because I've heard you sell
the statistic and it blows meaway.
Jeremy Julian (08:04):
Sorry, I
Hamed Mazrouei (08:05):
didn't mean to interrupt you, but it's
absolutely, it's insane.
It is insane across the wholeindustry.
70% of your customers do notcome back.
Now the question to you is, whatare you doing to give them back?
Jeremy Julian (08:15):
Yeah.
And so tell me how you guys aresolving that problem.
'cause at the end of the day,I've heard that whole adage, 50%
of marketing works, we justdon't know what 50%.
But I think that's such an oldadage because nowadays we know
who they are.
They're carrying around atracking device in their pocket,
they're engaging with your brandon social, they're engaging,
they're coming by the stores.
So there's so many pieces ofdata to know who's there, how
(08:37):
often did they come in, what didthey spend?
So I guess, how are you guyshelping restaurant brands from
that retention perspective toget them coming back?
Hamed Mazrouei (08:44):
Sure.
So the conversation actuallyhappened here as well, that, the
CEO of Chili's was like, Hey,just make it simple.
Meet them where they are.
Don't force'em to download anapp.
I'm not going to download yourapp, period.
I don't need it.
If I'm gonna eat there onceevery six months, good luck.
Why?
Why would I need your app?
Meet me where I am.
Just do the basics.
Just the real basics, meaningjust communicate out.
(09:05):
So for example, this is how wedo it.
You come into the restaurant, wehave your phone number on file,
either through reservation or atthe point of entry.
they put it in your POS and itgets fed to us.
And then we immediately send atext message to the customer an
hour after the check was closed.
And it's like, how was yourexperience?
We opened that line ofcommunication immediately.
(09:26):
I know if it's your first time,chances are you're probably not
gonna come back.
How do I increase my odds ofgetting 15% of those customers
to come right back into therestaurant within a.
60 day window.
So the first thing is customerfeedback.
'cause if they hated your brand,they're not coming back.
At least you know where youscrewed up.
If that's the reason they're notcoming back.
(09:47):
Now, if you blew it out of thewater, great.
Can you gimme a five starreview?
That reduces your acquisitioncost.
'cause the first thing I'mlooking at, if you're a sub
four, if it's a 3.9.
Yeah, you're not going.
I'm not going.
Yeah.
I have other options that arefour, four and a half, 4.7, 4.9.
Now there are so manyrestaurants within 4.9.
I'd rather go there'cause it's asafer bet.
(10:09):
Then some number of days later,based on the, frequency of
customers, we proactively sendout a marketing message, a super
strong offer.
Buy one, get one.
And by the way, the, we, Ididn't come up with this
strategy.
It's John Taffer from BarRescue.
He said that seven, eight yearsago.
And there isn't anyone in therestaurant industry who's
(10:31):
executing on that, even thoughthe information is there.
Yeah.
I'm just simply enabling thatoption to make it to the, to be
able to execute that.
So you gotta buy one, get onefree.
When you come back, then itknows that it's your second
time.
Then we send out a.
Lower, offer a free appetizer ordessert, and then we send out on
a fourth visit, we send, we give'em a free drink and then we
taper it off and we're done.
(10:52):
And everybody says, oh, you'redoing that to build loyalty?
No, my friend, we're not doingthat to build loyalty, we're
doing that to build behavior.
Jeremy Julian (10:59):
Yeah.
'cause I say this all the time.
There's a certain circulation ofrestaurants that you go to all
the time, and if they get outthe rotation, if they get out of
the rotation, you miss it.
The other one that I would say.
That I'd love for your thoughtson it.
Actually, it happened last nightat dinner, we gave a poor review
and had no interaction, noemail.
No table touch, no having to bea casual dining chain.
(11:21):
Nobody came to the table andsaid, you had a, you put a one
star review on their mechanism.
Oftentimes, I think guests justwant to be heard.
They want to know that you care.
They wanna know you're asking,but if you don't follow up, it's
just as bad as not asking alltogether, in my opinion.
Hamed Mazrouei (11:35):
Yeah.
Don't bother.
Yeah.
Yeah.
If it's not, I'm a big believerof actionable data.
I don't believe in data.
I believe in actionable data.
Yep.
In fact, I was just having thatconversation with the CEO and he
said the same thing.
He is how do you know thatthey're gonna do that?
I'm like, listen, when I leave aone store review for anyone,
it's because you made it sodifficult that I can't get ahold
(11:56):
of you.
I can vent out and say, Hey, youscrewed up.
Please fix it.
Then I have to leave you a onestar review.
Yeah.
So when that response comes in,you gotta respond.
And by the way, like in 2011, webuilt a customer feedback tool
back then.
We don't do this today, rightnow yet because we haven't had
the need for it.
But if you left, if we, if oursystem detected it, you had a
(12:19):
negative experience, would giveyou a bogo.
But if you had a positiveexperience, would give you a
free appetite.
Personalization down to DOTscan.
This is in 2011, like this is 14years ago.
Jeremy Julian (12:29):
But I think all, and the funny thing you say that
is, is when I go onto my Amazonlogin, it's very different than
my wife's Amazon login.
What she shops for is different.
we're personalized everywhereelse in our world, but it's not
personalized for whateverreason.
Restaurants, all retailers aredoing it, but it feels like
restaurants are just spray andpray and hope that somebody
comes back in and yeah, it's notthe way that the world works in
(12:50):
2025 and beyond.
And
Hamed Mazrouei (12:52):
Actually let me, so like we technology companies,
we have the opposite problem.
We have an acquisition problem.
Yeah.
It's hard for us to get acustomer, but our average
customer 10 years is rightaround eight years right now.
Eight years.
Yeah.
They are on our platform foreight years.
They pay month in, month out.
So the reason we're able tocrush it is because of
(13:13):
retention.
Now, obviously acquisition isjust as important, but in a
restaurant industry, justretention doesn't seem to exist.
So I'm very passionate.
I wanna solve one problem andone problem only.
I want to drive increasedrevenue, and the only way I know
how to is through retention
Jeremy Julian (13:30):
is to get the people that, that 70% that don't
Hamed Mazrouei (13:32):
come back.
how do I get them to come back?
I just want 15% of them to comeback in and I want to bump
everyone to the next visit.
Because if I get a guy thatvisits three times to come in,
four, the guy that comes in twoto come in three times a year,
I've meet, I've met my goal, andI only need 15% of'em to do
that.
And by doing that, I'm alreadyincreasing revenues by about 150
(13:53):
to 200k a year, which then putsyou on a million dollar mark or
above.
And by the way, like averagerestaurant in 2019 was making
600 grand.
A year in top line revenue.
Okay.
My first company, one of us, sub1 million.
Guess what?
I had thin margins.
Yeah.
I had high labor cost.
I had high cost of good sold.
(14:14):
Yeah.
Driving that top line, the salescures a lot of problems.
Once I passed the million dollarmark, I'm like, oh, interesting.
My labor cost is the same, butit's not that bad anymore.
Like profit starts coming inagain.
Your first million bucks issimply to pay overheads, right?
It's to pay the fixed cost.
Stuff.
And then, once you pass that,everything else becomes
Jeremy Julian (14:36):
very much easier.
You can invest and do all ofthat stuff.
So Ed, how do people get intouch?
How do people learn more abouthow you can help them on the
infrastructure side, on thetechnology side, and I know how
to get ahold of EBIT for ourlisteners that are out there.
Yeah.
Hamed Mazrouei (14:47):
Website is the best way.
Just learn about that stuff onthe website and then feel free
to send us an email or find meon LinkedIn and.
let's get in touch.
I'm, again, laser focused onretention, laser focused on this
connectivity stuff.
If I can solve those twoproblems for the industry, I
think I've made my mark for theentire industry, love it.
thank you for taking the time.
Absolutely.
Thanks for having me.
So Hammed, why don't you introduce yourself to
our audience Who is Hammed?
a lot of people have seen you'cause you're, you've got the,
you've got the look, but, and alot of people are like, who is
that guy?
But I'd love for you tointroduce yourself to our
audience.
Absolutely.
Hamed Mazrouei (00:11):
So my name is Hamed Mazrouei i'm the founder
of, Vivant and Milagro.
So I run two differentcompanies, focused one side on,
connectivity, eliminatinginternet outages, providing a
hundred percent uptime guaranteethrough what we call a half
platform, highly available,fault tolerant.
All that means is we justeliminate internet network
outages in order to ensure thatyour online orders, your third
(00:34):
party orders, payment processorswait list, reservation, none of
that goes offline, so you don'thave to deal with the
complexities that comes withoutages.
So that's on one side.
And then on the other side, wefocus on retention.
Like restaurant industry hasn'treally fully, got that under
control, I think and I stronglybelieve that by end of the
decade, I've said this severaltimes, that there's gonna be
(00:56):
some billionaires that maketheir billions in the restaurant
industry, and they're gonna doit through customer retention.
So those who master that aregoing to increase revenues,
which then who cares if foodcost is 35% and labor is 35%, it
doesn't matter.
Even though you took a 10%,increase in, in cost of goods
sold and labor, it's not gonnaimpact you much and you're never
(01:17):
gonna have that thin marginissue.
Jeremy Julian (01:19):
Yeah, no, and I've listened to you talk, for a
while about the whole idea ofgas retention, but.
Let's dig in.
So I was actually just on thephone this weekend with a
customer talking about exactlywhat you had shared with them.
They're now at 70% of theirorders are coming in digitally.
So internet has played such acritical role.
And the reason I was talking tothem is they had did a reference
(01:39):
call and the customer had said,what happens when the internet
goes down?
I say, ostensibly we have aproblem.
It's not'cause the point of salethat we sell is the problem.
It's ultimately because.
Third party delivery kiosk, allof these other things are
operating on the internet and ifthe internet's not stable.
So what have you seen as you'vebeen in this connectivity space?
'cause you've been doing thisfor a while.
Hamed Mazrouei (01:57):
Oh yeah.
We've been doing that for about15, 16 years now.
So
Jeremy Julian (02:01):
early days it didn't matter as much.
it was critical, but it wasn'tas
Hamed Mazrouei (02:04):
critical as it is now.
I agree, nowadays, everything'sonline, like everything and by
the way, 2019 okay maybe youlose 10, 15, 20% of online
orders'cause the, you justcouldn't.
But today it's probably 30, 40%of your revenue and it's so
inexpensive to do that, to justkeep the network up and running
at a hundred percent with nooutages, that it's just, it
(02:27):
doesn't make any financial sensewhy you should not be doing
something like this and again,it's anything that takes away
from that top line revenue putsyou in that thin margin
situation, you can't afford todo that.
Jeremy Julian (02:40):
and the one thing that people underestimate,'cause
oftentimes, and I'm sure you runinto this, so for those
listeners that are out therethat are like, oh, but it costs
too much to have a, have aninternet connection, I.
a secondary internet connection.
An SD-WAN a highly available,it's too expensive.
But when we talk about what theylose for an hour of sales, even
if they're only making 20% onthose hour of sales, one hour of
(03:01):
downtime can pay for it.
So talk us through howinexpensive it and how
affordable it's gotten'causeit's not even inexpensive, it's
affordable, especially when youlook at the opposite side of it.
Agreed.
Hamed Mazrouei (03:10):
It's a thousand percent affordable.
You don't have to go for therestaurant space itself, you
don't have to do thecomplexities of SD-WAN and go
through all that expenses.
You just need somebody who'sdone this before, who knows what
they're doing, and who cancreate an infrastructure that
just keeps that businessessential services online.
That's what we say, and it's sogood and it's so real it's so
(03:33):
good it works so well that ourcustomers don't even know.
So the fir, so we get obviouslyproactive notifications.
we call the customer first andsay, Hey, by the way, FYI, you
on backup.
Don't worry, we've got itcovered.
We're calling the ISP.
We're trying to sort that out.
And they're like, no, Internet'sworking.
It's no, it's not working.
no, they're arguing, it'sworking.
It's trust me, it's not working.
You're on backup.
(03:53):
in terms of cost, you arelooking at probably sub 400
bucks a month per location, permonth for a primary internet
connection, a backup, afirewall, the wifi, the, PCI
compliance, the intrusiondetection, all the security
stuff, the content filtering.
Like right now, most restaurantsare probably paying around 500
(04:15):
bucks a month without the backupand without all, and without the
proactive
Jeremy Julian (04:18):
services, without all of those kind of things.
Hamed Mazrouei (04:21):
So and so for you lose that sale.
It's,
Jeremy Julian (04:23):
it,
Hamed Mazrouei (04:24):
yeah.
It's gone.
Yeah.
Look, you're, you are morelikely to save money by
combining it and putting it in abundle and getting that a
hundred percent off time andeliminate all your outages than
it is not doing it again.
It's just mind boggling how somepeople are like, oh, it's gonna
cost me 50 bucks a month to dothis, and I'm just not willing
(04:45):
to do that.
It's it's$600 a year.
You lose a one, you loseinternet during lunch or,
Jeremy Julian (04:51):
dinner.
You're done.
and you get the argument, oh,but at my house it never goes
down, and I laugh'cause I'mlike, yes, you're number one.
Oh, so you can't watch yourNetflix, so you're upset about
it at your house.
Like you can't process creditcard, you can't process a
loyalty transaction.
You can't process an onlineorder or a third party delivery
order when you have no internet.
Yeah.
So people don't think throughthat.
(05:11):
So is that a common thing thatyou guys continue to run into?
Hamed Mazrouei (05:13):
not really anymore.
I think people are waking up toit and they're saying, okay,
like I, I actually need to makea change.
And that's becoming, it's slowlybecoming a norm.
so I think people are realizingthe pain point and they're
starting to, take a stance of,Hey, how do I just ensure it
never goes down?
And how do I keep it, affordableso that I'm not spending a
(05:35):
thousand bucks a month?
love that.
And by the way, there arerestaurants, like we've got some
customers that are spending, 13,1400 bucks a month, but your
AUVs are five, 6 million bucks.
And it's Hey, I don't care.
I just don't want to lose thatrevenue.
Jeremy Julian (05:46):
Yeah, I love that.
let's flip the script realquick.
you talk about retention and whydo you think that retention is
such a critical piece of therestaurant equation?
again, you've been in therestaurant space for close to 20
years now and Yep.
I think, and you and I bothkinda live in a similar part of
the country where.
The restaurants are abundant,but it feels like less people
think about that.
(06:07):
But why do you have such apassion to ensure that people
retain their customers and getthem coming back?
Hamed Mazrouei (06:12):
Yeah, so the story begins from when I, story
begins in like 2010 and actuallythere was a news article or
some, one of these magazines, Ithink fast casual QSR online
published a thing that I hadsaid in 2013.
And I went back and read itmyself.
I'm like, whoa, who said that?
(06:32):
And it's oh, it's by me.
So it started back then and itstarted with the guys at Gena
Squirrel, and I was sitting, Ineed the sea levels.
I was in their meetings everyMonday, 7:00 PM until whenever
it ended.
And I saw the problems at thehigh level and I started asking
my questions why?
Like, why is I.
You, you are selling a margaritafor 12, 13, 14 bucks.
(06:55):
It cost you a dollar.
That's a hell of a margin.
Like what other industry do yougo to where it costs you a
dollar?
You sell it for$10, right?
10 x.
Jeremy Julian (07:04):
Yeah.
Hamed Mazrouei (07:04):
That's crazy.
Margins.
But then everybody'scomplaining.
So I start asking, why does itdo that?
And then it's they're not reallymarketing.
Or if they're marketing likethey were back in the day, those
guys crushed it.
they, the guys at Genis likethat, I remember they had 2.2
million people in their emailsubscriber list back in 2010.
Oh my
Jeremy Julian (07:23):
goodness.
Okay.
In 2010,
Hamed Mazrouei (07:24):
right.
And it was antiquated.
You write your name, email on apiece of paper, it gets scanned,
it gets sent overseas, and thenthey manually type it, put it in
a spreadsheet, send it back overto the, it just, it was
complicated, but that's whatthey did to crush it.
But everybody, first Tuesday ofevery month got kids eat free.
And I always used to make fun ofv not make fun of him, but get
(07:46):
in a conversation and be like,Hey, I don't have kids.
Why do you send me kids?
Eat free offers.
And he would just shrug it off.
We like, that's all we could do.
I'm like, no, you can actuallypersonalize it.
So closing the loop on that 70%of people that go in the
restaurant never go back.
Uhhuh.
There's a reason they don't goback because I've heard you sell
the statistic and it blows meaway.
Jeremy Julian (08:04):
Sorry, I
Hamed Mazrouei (08:05):
didn't mean to interrupt you, but it's
absolutely, it's insane.
It is insane across the wholeindustry.
70% of your customers do notcome back.
Now the question to you is, whatare you doing to give them back?
Jeremy Julian (08:15):
Yeah.
And so tell me how you guys aresolving that problem.
'cause at the end of the day,I've heard that whole adage, 50%
of marketing works, we justdon't know what 50%.
But I think that's such an oldadage because nowadays we know
who they are.
They're carrying around atracking device in their pocket,
they're engaging with your brandon social, they're engaging,
they're coming by the stores.
So there's so many pieces ofdata to know who's there, how
(08:37):
often did they come in, what didthey spend?
So I guess, how are you guyshelping restaurant brands from
that retention perspective toget them coming back?
Hamed Mazrouei (08:44):
Sure.
So the conversation actuallyhappened here as well, that, the
CEO of Chili's was like, Hey,just make it simple.
Meet them where they are.
Don't force'em to download anapp.
I'm not going to download yourapp, period.
I don't need it.
If I'm gonna eat there onceevery six months, good luck.
Why?
Why would I need your app?
Meet me where I am.
Just do the basics.
Just the real basics, meaningjust communicate out.
(09:05):
So for example, this is how wedo it.
You come into the restaurant, wehave your phone number on file,
either through reservation or atthe point of entry.
they put it in your POS and itgets fed to us.
And then we immediately send atext message to the customer an
hour after the check was closed.
And it's like, how was yourexperience?
We opened that line ofcommunication immediately.
(09:26):
I know if it's your first time,chances are you're probably not
gonna come back.
How do I increase my odds ofgetting 15% of those customers
to come right back into therestaurant within a.
60 day window.
So the first thing is customerfeedback.
'cause if they hated your brand,they're not coming back.
At least you know where youscrewed up.
If that's the reason they're notcoming back.
(09:47):
Now, if you blew it out of thewater, great.
Can you gimme a five starreview?
That reduces your acquisitioncost.
'cause the first thing I'mlooking at, if you're a sub
four, if it's a 3.9.
Yeah, you're not going.
I'm not going.
Yeah.
I have other options that arefour, four and a half, 4.7, 4.9.
Now there are so manyrestaurants within 4.9.
I'd rather go there'cause it's asafer bet.
(10:09):
Then some number of days later,based on the, frequency of
customers, we proactively sendout a marketing message, a super
strong offer.
Buy one, get one.
And by the way, the, we, Ididn't come up with this
strategy.
It's John Taffer from BarRescue.
He said that seven, eight yearsago.
And there isn't anyone in therestaurant industry who's
(10:31):
executing on that, even thoughthe information is there.
Yeah.
I'm just simply enabling thatoption to make it to the, to be
able to execute that.
So you gotta buy one, get onefree.
When you come back, then itknows that it's your second
time.
Then we send out a.
Lower, offer a free appetizer ordessert, and then we send out on
a fourth visit, we send, we give'em a free drink and then we
taper it off and we're done.
(10:52):
And everybody says, oh, you'redoing that to build loyalty?
No, my friend, we're not doingthat to build loyalty, we're
doing that to build behavior.
Jeremy Julian (10:59):
Yeah.
'cause I say this all the time.
There's a certain circulation ofrestaurants that you go to all
the time, and if they get outthe rotation, if they get out of
the rotation, you miss it.
The other one that I would say.
That I'd love for your thoughtson it.
Actually, it happened last nightat dinner, we gave a poor review
and had no interaction, noemail.
No table touch, no having to bea casual dining chain.
(11:21):
Nobody came to the table andsaid, you had a, you put a one
star review on their mechanism.
Oftentimes, I think guests justwant to be heard.
They want to know that you care.
They wanna know you're asking,but if you don't follow up, it's
just as bad as not asking alltogether, in my opinion.
Hamed Mazrouei (11:35):
Yeah.
Don't bother.
Yeah.
Yeah.
If it's not, I'm a big believerof actionable data.
I don't believe in data.
I believe in actionable data.
Yep.
In fact, I was just having thatconversation with the CEO and he
said the same thing.
He is how do you know thatthey're gonna do that?
I'm like, listen, when I leave aone store review for anyone,
it's because you made it sodifficult that I can't get ahold
(11:56):
of you.
I can vent out and say, Hey, youscrewed up.
Please fix it.
Then I have to leave you a onestar review.
Yeah.
So when that response comes in,you gotta respond.
And by the way, like in 2011, webuilt a customer feedback tool
back then.
We don't do this today, rightnow yet because we haven't had
the need for it.
But if you left, if we, if oursystem detected it, you had a
(12:19):
negative experience, would giveyou a bogo.
But if you had a positiveexperience, would give you a
free appetite.
Personalization down to DOTscan.
This is in 2011, like this is 14years ago.
Jeremy Julian (12:29):
But I think all, and the funny thing you say that
is, is when I go onto my Amazonlogin, it's very different than
my wife's Amazon login.
What she shops for is different.
we're personalized everywhereelse in our world, but it's not
personalized for whateverreason.
Restaurants, all retailers aredoing it, but it feels like
restaurants are just spray andpray and hope that somebody
comes back in and yeah, it's notthe way that the world works in
(12:50):
2025 and beyond.
And
Hamed Mazrouei (12:52):
Actually let me, so like we technology companies,
we have the opposite problem.
We have an acquisition problem.
Yeah.
It's hard for us to get acustomer, but our average
customer 10 years is rightaround eight years right now.
Eight years.
Yeah.
They are on our platform foreight years.
They pay month in, month out.
So the reason we're able tocrush it is because of
(13:13):
retention.
Now, obviously acquisition isjust as important, but in a
restaurant industry, justretention doesn't seem to exist.
So I'm very passionate.
I wanna solve one problem andone problem only.
I want to drive increasedrevenue, and the only way I know
how to is through retention
Jeremy Julian (13:30):
is to get the people that, that 70% that don't
Hamed Mazrouei (13:32):
come back.
how do I get them to come back?
I just want 15% of them to comeback in and I want to bump
everyone to the next visit.
Because if I get a guy thatvisits three times to come in,
four, the guy that comes in twoto come in three times a year,
I've meet, I've met my goal, andI only need 15% of'em to do
that.
And by doing that, I'm alreadyincreasing revenues by about 150
(13:53):
to 200k a year, which then putsyou on a million dollar mark or
above.
And by the way, like averagerestaurant in 2019 was making
600 grand.
A year in top line revenue.
Okay.
My first company, one of us, sub1 million.
Guess what?
I had thin margins.
Yeah.
I had high labor cost.
I had high cost of good sold.
(14:14):
Yeah.
Driving that top line, the salescures a lot of problems.
Once I passed the million dollarmark, I'm like, oh, interesting.
My labor cost is the same, butit's not that bad anymore.
Like profit starts coming inagain.
Your first million bucks issimply to pay overheads, right?
It's to pay the fixed cost.
Stuff.
And then, once you pass that,everything else becomes
Jeremy Julian (14:36):
very much easier.
You can invest and do all ofthat stuff.
So Ed, how do people get intouch?
How do people learn more abouthow you can help them on the
infrastructure side, on thetechnology side, and I know how
to get ahold of EBIT for ourlisteners that are out there.
Yeah.
Hamed Mazrouei (14:47):
Website is the best way.
Just learn about that stuff onthe website and then feel free
to send us an email or find meon LinkedIn and.
let's get in touch.
I'm, again, laser focused onretention, laser focused on this
connectivity stuff.
If I can solve those twoproblems for the industry, I
think I've made my mark for theentire industry, love it.
thank you for taking the time.
Absolutely.
Thanks for having me.
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