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Revel Systems | November 3, 2021 |
Reliance on tech companies during the pandemic has not been all that bad. In fact, quarantine weekends have been surprisingly enjoyable.
On Friday night your family may watch a comedy. You’re in the mood for binging a Netflix show, so you pop in your headphones and stream a series through your phone. On the same sofa your family is watching a different show while you are engrossed in your episode.
You would never have been able to enjoy two movies in one setting at the movie theater.
Saturdays aren’t that bad either. Each family member can order from a different restaurant through UberEats to get exactly the meal they desire. These customized experiences would never be possible at a typical pre-pandemic restaurant, where they serve only one type of food.
So now that the world is opening up again post pandemic, how are customers reacting to a return to their generic in-person experiences? How do they feel when they walk into a steakhouse and cannot order the potstickers they really crave? What do they think when they go to a bowling alley but would prefer to play arcade games instead?
Limited options for entertainment and food can lead to new frustrations now that customized algorithms are the norm. People are used to having what they want, when they want it. Imagine deciding where to meet a group of friends on Friday night when each person expects a tailored experience to their unique preferences. This would be impossible with traditional restaurants, arcades, pool halls and sports bars.
To solve this, entertainment centers and restaurants have combined their value propositions to become so-called “eatertainment” venues. They offer a variety of high-quality foods, drinks and activities in one location to match everyone’s needs.
You’re likely familiar with entertainment-food combos: the popcorn stand at the movie theater, the ice cream served at the mini golf course. But eatertainment centers take this combination to an entirely new level, offering premium meals and activities.
Paul Kermizian, CEO of the eatertainment company Barcade, says eatertainment is “part of a bigger trend where people want to go out and have an evening and an experience at one place: dinner, drinks, and games all under one roof.”
Leadership from Main Event, another eatertainment venue, expands on this saying eatertainment “takes care of the veto vote. Someone might want seafood, steak or vegetarian, and we have something for everyone. Someone can bowl, play laser tag or billiards and we have great food and beverage.”
Some sources indicate that 70% of consumers prefer to visit eatertainment venues over traditional restaurants for group occasions. “Instead of going for traditional casual dining, diners are spending their drinking and dining dollars in eatertainment,” says Robert Thompson, CEO of Punch Bowl Social.
Eatertainment has been able to avoid the pitfalls of traditional dining because the concept focuses on experience and also uses more sophisticated food and drink menus to enhance this experience.
Read on to find out why eatertainment companies are growing and how you can capitalize on the trend as well.
As a kid you may have eaten pizza while exploring arcade games and obstacle courses at Chuck E. Cheese. As you grew into a teen, you may have enjoyed Dave & Buster’s ticketed games while sipping Shirley Temples. Although these two organizations were the first movers in the eatertainment sphere during the 80s, it would be decades until other companies expanded on this idea and demand would reach a peak. Here are some of the top eatertainment companies today:
Entertainment: Golf games in climate-controlled bays (similar to bowling lanes)
Food & Beverage: Upscale bar cuisine like burgers, flatbreads, nachos, and Tex-Mex dishes. Notable meals include Brisket Grilled Cheese and the G.O.A.T. (Greatest of All Time), made with caramelized French toast and chicken breast marinated in jalapeño pickle brine. It’s dredged in a Cap’n Crunch breading and topped with jalapeño gravy, an over-easy egg, and bacon crumbles.
Entertainment: Arcade, karaoke, ping-pong, bocce ball and bowling
Food & Beverage: “Top Chef” judge Hugh Acheson leads culinary operations. The menu is modern and Southern-inspired. It offers comfort food, like Wagyu beef hot dogs, a bologna sandwich with green olive tapenade, and chicken and waffles made with chipotle cream cheese and pecan maple syrup.
Entertainment: Ping-pong hall
Food and Beverage: Asian street food. A classically trained Vietnamese chef creates the small-plates menu including appetizers like bao buns, dumplings, ramen, and Asian-style chicken wings.
Entertainment: Vintage video and arcade games
Food: Boasting a full kitchen, they serve American food including burgers, wings and fried chicken-and-waffle sandwiches.
About 60 percent of all consumers are interested in visiting an eatertainment venue, and 30 percent say they have already visited one. Additionally, 40 percent of consumers are interested in visiting an arcade bar, bowling restaurant, or social emporium, while 26 percent of consumers are interested in visiting a golf entertainment venue.
Senior publications manager at Datassential, Mike Kostyo, says the popularity of eatertainment is tied to social media. He says, “Everybody wants to go out and have an experience that they can share with their friends. If you’re a restaurant operator, you have to go above and beyond these days in order to get people out of their houses and create an experience that makes it a destination.” Essentially your location has to be engaging enough to be an “Instagrammable” destination.
CEO of Pinstripes, Dale Schwartz, says with the rise of social media, face-to-face interactions are now a point of differentiation. “People are disconnected with real humans in forming quality connections. With Pinstripes, we’re going back to the future by embracing human connections,” says Schwartz.
Families are the largest target audience for eatertainment. These venues can easily support birthday parties, community events and kid’s summer camps.
Millenials have become the largest buying segment, and they are truly seeking out and consuming experiences. Eatertainment establishments allow for experiential quality time, offering a myriad of options from high-tech artificial reality video games to a classic game of darts.
Millennials also are drawn to eatertainment because they do not eat like other generations. Millennials prefer to eat similar to Spaniards in tapas format, where they graze on appetizers. The generation finds this allows for more social bonding.
GenXers are also drawn to eatertainment. They are used to multitasking: browsing social media while on conference calls and paying their bills all in separate tabs. With little difficulty they can play ping pong while eating a burger.
Operations and high-energy staff are vital for an eatertainment’s success. Customers are always moving around the large venue, between the dining rooms and entertainment areas. Tracking down customers to deliver orders is an immense task.
As well, uniquely being able to support large parties requires expert guest management. “Our most challenging nights are the nights where we do a corporate event in the ping-pong room of 200 people, and then we still have a full dining room and a full patio. You’re trying to handle the potential of 400 or 500 people all at the same time and still hold onto the quality of that food.” says Josh Wolkon, owner of Topgolf.
Seve Delgado, national director of culinary operations for Punch Bowl talks about the importance of fast-moving staff: “Our dining is 60,000 square feet, three or four levels—depending on where you are—so that’s a pretty big challenge. We’ve got these rock-star food runners who get the food out of the kitchen for us and hike it up the stairs and drop it off at the table as quickly as possible. We call them our track team.”
With the eatertainment segment exploding, there has been a subsequent spike in competition. Competition includes casual restaurants, movie theaters, bowling alleys and even at-home entertainment, like streaming services. Fast-casual dining is not considered major competition.
Wolkon notes, “It’s so easy to not leave your house, fire up ‘Game of Thrones’ on your time schedule, call one of your new delivery services to deliver from anywhere in town, and never have to get up and go out.”
Because of the increased competition, growth has been slowing down compared to previous years. Darren Tristano, a River Forest, Illinois-based foodservice consultant says: “Growth is coming from stealing chairs from existing businesses, [revenue is increasing by 3 percent annually but] there aren’t enough new locations to go around.”
Tristano states success in eatertainment hinges on attracting a steady stream of weekly customers rather than seasonal guests.
In order to have loyal returning customers, eatertainment venues must provide sophisticated and timely service. Eatertainment venues must offer “value and frequency, whether it’s quality of food, or the bartender makes a great drink, or specializes in great value,” says Tristano.
Pinstripes’ Founder Dale Schwartz expands on this idea stating: “With people’s ability to enjoy prepared food at Whole Foods and their equivalents, restaurants and eatertainment eateries will have to execute and deliver phenomenal food, consistent service and superior décor.”
Essential to the strategy of maintaining customer loyalty is quality drinks and food. Schwartz notes that their menu is responsible for retaining clientele, “We offer sophisticated fun. Everything is made from scratch, and we offer a phenomenal wine cellar and craft beers, in a comfortable family friendly environment.”
For the average eatertainment establishment about 75 to 80 percent of revenue stems from food and beverage, the remainder comes from entertainment. For Punch Bowl, their upscale, chef-driven food and beverage menu account for 89 percent of its revenue.
Customers are willing to pay premiums for food and drink because eatertainment does not shy away from unique offerings. An eatertainment business owner notes that they uniquely offer Italian American food “with an inventive spin.” Mashups include Italian jambalaya, homemade gnocchi and grilled chicken with a spicy cilantro.
At Royal Palm Shuffleboard, there has been significant income from drinks. The co-founders set up a “surprisingly legit” bar program. They use house-made syrups and fruit purées in vacation-inspired drinks named after shuffleboard legends.
Drinks are also popular at Barcade. The eatertainment company launches new tap lists every day and runs brewery-sponsored events. “We get a lot of regulars that are looking for rare beers that we pour,” says Paul Kermizian, CEO of Barcade.
Even at Topgolf, CEO Erik Anderson boasts that half of its customers are “non-golfers.” Guests join for date nights, corporate events, happy hours, breakfasts and birthday parties drawn to the establishment’s accomplished executive chef and menu.
Dave & Buster's has recently felt the pressure from increasing competition of high-end eatertainment venues. The company recently reconceptualized 75% of its menu, launching premium and healthy offerings.
What happens when your leadership team is experienced with entertainment offerings but not food? How do you make the jump to instituting food at your entertainment complex? More and more eatertainment establishments are looking to partner with outside vendors to fulfill their food needs. A popular option has been food trucks.
For example, Ashley Albert and Jonathan Schnapp are co-owners of Royal Palms Shuffleboards in Brooklyn. They needed to bring in more revenue and turned to adding food items at their location. However, the team had no experience with restaurants and did not care to bring on leadership which did. Instead of ad hoc piecing together their own menu, the owners built a fireproof room where various food trucks could drive inside and serve guests appetizers like lobster rolls and tacos. The food trucks were a success, allowing for more profitable operations.
The eatertainment chains that will thrive in the coming years will grow strategically by selecting locations carefully and focusing on niches.
Main Event’s Stancil believes there is enough demand for several companies to succeed in specific niches. “Many times there’s a Main Event located a mile from a Topgolf, and each caters to someone a little bit different,” he says, suggesting all can thrive.
Schwartz, CEO of Pinstripes, also underscores the importance of being “hypersensitive to pick the right location and continuing to grow at a measurable controlled pace. We’re opening four or five locations a year; we’re not opening 15 to 20 a year.”
Schwartz is also focused on Pinstripes’ niche target audience. To avoid saturation, he steers clear of competitors' unique audiences, noting Punch Bowl Social “is more focused on urban locations and Dave and Buster’s skews younger than ours.”
Robert Thompson, CEO of Punch Bowl Social, agrees with Schwartz: “Everyone of the other brands orient toward the suburbs. Urban is our sweet spot.” The eatertainment venue has 11 outlets and plans to open six more within the year. This expansion is fiscally supported by the $20 million raised in funding in the previous year.
Notably, Punch Bowl Social is launching a prototype in Texas half the size of its typical locations this year in Texas. Many other eatertainment facilities are also looking to expand using into smaller locations.
Topgolf has taken a more aggressive approach as well, launching global expansion in Europe and plans to tackle the Australian and Mexican markets as well. They are aiming to open seven to 10 outlets annually.
Dave & Buster's also is capitalizing on increased demand, planning to open 15 to 16 new restaurants annually.
Hosting unique food and drinks, offering consistent service and a plethora of enticing entertainment options is a heavy order in and of itself. But how are eatertainment venues using customer data to compete with companies like Netflix?
Technology should play a major role in deciding your menu and activities. When you consider your tech stack, it’s important to have a robust point of sale (POS) platform, like Revel Systems® that collects customer data and can easily display preferences in a dashboard.
Learn more about Revel’s POS platform and how it can benefit your company.
“The idea of adding more elements to what it means to go out at night,” Royal Palms’s CEO Albert says, “That’s only going to become a more desirable feature of the hospitality industry.”
In the coming years eatertainment venues will expand to incorporate additional activities, such as archery, escape rooms and axe throwing. As well, Punch Bowl Social’s Thompson believes mergers-and-acquisition will create consolidation in the eatertainment industry in the next few years.
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