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Inside Mellow Mushroom’s Data-Driven Strategy for Growth with Ahsan Jiva

42m 56s

Inside Mellow Mushroom’s Data-Driven Strategy for Growth with Ahsan Jiva

Asanjeeva, the EVP of Strategy and Transformation at Mellon Mushroom, shared insights into his career journey and the digital transformation in the restaurant industry. He highlighted the importance of leveraging data, technology, and customer experience to drive operational efficiency and enhance business performance. Mellon Mushroom underwent a brand refresh, Neutro, to modernize its image while preserving its unique identity as a counter-culture brand. Additionally, the company introduced a new counter-service model, the fast-fine prototype, to cater to changing consumer preferences and reduce operational costs. By embracing digital innovations and focusing on enhancing the guest experience, Mellon Mushroom aims to continue thriving in the evolving restaurant landscape.

Transcription

8486 Words, 46298 Characters

Hi everyone, welcome back to the Restaurant Innovator, a podcast from the editors of EPSR Magazine that spotlights forward-thinking chefs, restaurant owners and operators, and tech trailblazers who are transforming today's food beverage and hospitality industries. I'm your host and EPSR editor, Callie Evergreen, joined with my colleague and co-host Sam Danley associate editor. I'm so excited to introduce our special guest for today's episode, Asanjeeva, the EVP of Strategy and Transformation at Mellon Mushroom, stone-baked pizza-bakers with 160-plus locations nationwide that just celebrated its 50th anniversary last year. Asan, thank you so much for joining us. I'd love to start off by hearing a little bit about your background, your career journey, how you got to Mellon Mushroom. I heard it was partly for a genuine love of their iconic Kholishitake pizza. Yeah, yeah, actually there was a little wordplay I was going to do there, so you kind of took that from me, Callie. No, but thank you, first of all, thank you both for having me on. I'm really excited to chat about the restaurant industry in Mellon Mushroom specifically, sort of the way I see our industry and our business through my lens. My journey into the restaurant industry wasn't a traditional one, but the more I meet people in our industry, that kind of seems like that's the case for a lot of folks, which I think is one of the great reasons why our industry is so fantastic. But my career started in management consulting, I worked with Fortune 100 companies, really focused on driving efficiency, reducing customer churn, and then obviously those two things combined, helping to improve top and bottom line performance through a financial lens. But then you add in the financial lens and then you take in the customer experience lens, so that can be employees or customers, really the user lens, if you will, and then leveraging technology and data as an accelerator. So over the many years in the management consulting arena, I had the opportunity to work across a variety of industries, media entertainment, supply chain, retail consumer goods, and all that really to help optimize operations and enhance customer experience and embracing digital transformation. One of the biggest things that I learned at that time was not to chase the shiny object, which has really kept me grounded in my career in the restaurant industry because, you know, quite frankly, I didn't come from a hospitality background. So to me, a lot of it was new, but it was exciting because of the untapped potential within the restaurant industry. So with that learning, I was able to kind of use data to really better understand consumer behavior, leveraging automation and improve efficiency, digital touch points for seamless customer interactions, all the things that we talk about now on a daily basis, there were so pretty nascent, if you will, you know, just even three, four, five years ago, especially pre-COVID. And so that brings me to, you know, joining mellow. So I had the, you know, perfect timing, as I like to say, of joining mellow about, let's all round up and say about a month or two months before COVID hit. So you can imagine me coming not from a hospitality background, but then joining the industry and all of a sudden, it's like everything is different, you know. So whatever you knew, if from the restaurant industry just, you know, throw that out the door, we're going to do something new, which was great. And I say that because as we all know, that enabled digital transformation across our entire industry almost overnight, right? And, you know, that's really when I joined mellow. But you know, for me, I was always passionate about restaurants. I come from a family of really good, not chefs, but cooks, because they're not professional and trained chefs. You know, I tell my mom all the time, they mom, he got to open up a restaurant because, you know, every time someone eats your food, it's fantastic, you know. So, you know, we all experienced that at some part of our life, but, you know, I was really passionate about the restaurant industry and Kelly, you are right. It was the Holy Shitake pizza, you know, that really got me. And I like to say, you know, I was like, Holy Shitake, it was good, you know, and I actually, when I first had it, I asked the, I asked my server and I was like, does everyone react like this when they try the pizza? She said yes. So, you know, just knowing that, I was like, man, this product is so good. And, you know, I had experienced mellow, it's kind of, it's called growing up because I'm from the southeast. I went to Auburn University and we have a mellow there. So, shameless plug, mauberant tigers, War Eagle, you know, we have a good basketball program this year. But that's really when I got experience with the brand. And then, I met some folks along the way and had some good conversations around where the brand was headed from a digital transformation standpoint. And I decided that it was a great opportunity to sort of apply the things that I had learned, you know, in other industries and bring that knowledge into mellow mastery, and specifically in the restaurant industry. So, you know, like I said, it was right before COVID. So, we dove in pretty, pretty hard and fast. So, you know, I was able to join as, you know, director of digital strategy and analytics. Really, that was my marching orders to start with when I first joined, it's been about five years now. So, we deployed enterprise-wide analytics platform, giving us almost real-time insights into the data for customer preferences and operational performance. That really helps us make better business-driven decisions. And then, at the same time, we strengthened our digital marketing strategy. We pivoted 100% to off-premise, good thing is we had made those investments even prior to what I got here, but we continued to build on those investments and put us in a position where, you know, about, I would say, 40% of our business now is off-premise where, you know, just a few years ago, we were 80, 85% even at times that dine in business. So, you can imagine the technology stack that has to support that and things that have to come along the way to be able to execute effectively in those, sort of, changing customer preference environment. So, and then, you know, now, most recently in my role as EVP of strategy and transformation, I oversee, sort of, all aspects of digital innovation. That includes, you know, the guest side, it also internal team member side and the GM side and the franchisee side, because to me, they're just as important, because you provide a great experience to your team members and your folks and your franchisee, they're interround do the same thing to your guests. So, you know, that's sort of where I spent a lot of my time and also a new store format. You know, we're really excited about our new prototype that we've developed that launched in November of last year. It's a counter-service model with some really exclusive menu items and new technology that we've put into that prototype as well. And then, you know, most recently, I also oversee our franchise sales and development efforts now too. So, one of the key areas that we're focused on is how do we reduce our barriers to entry for, you know, franchisees and potential investors. That's really what I focus on most of my time now. But, you know, that's what gets me excited. It's kind of this blended role that I had that kind of blend strategy, technology, analytics, and most importantly, the execution of it, right? And kind of combining that in a culture that makes sense to help Mellow Mushroom continue to grow and thrive for the next 50 years. So, long-winded way of saying I've had a lot of experience and now I'm trying to do the same thing at Mellow. I love it. So, you mentioned, like, a new counter-service model, which seems like a pretty big deal, you know, for a 50-year-old legacy brand that's always been in the full-service sphere. Tell us a little bit about that decision. What was kind of the motivation for getting into a whole new kind of service model? Yeah. So, there were a lot of motivating factors, all this, and no particular order but to the top three. It was really, you know, we saw with the industry was headed, right, which is, in my personal opinion, kind of unfortunate that, you know, people are always trying to die now, and you kind of lose the fun aspect of going out to restaurants, especially as people go so much more off-premise with third-party and to go and all-mind ordering, to me, it's kind of sad because you kind of lose that camaraderie aspect, but hey, you know what, if that's where the industry is headed, we're going to make sure that we are ready and thriving in that environment. So, you know, that was one thing, so, you know, behaviors were changing, and at that time, and still now, you know, who knows what's going to happen from a political landscape, but, you know, costs are going up in terms of input costs to build a restaurant. That's not changing. Labor costs are not changing. So, you know, we looked at our business model and said, well, we have great, you know, full-service restaurants that are, you know, five, six, you know, as big as 14,000 square feet depending on the location, and that gets challenging to build these days, right? And we looked at sort of our unit economics and said, well, we need to do something to lower our input costs and make this an attractive business model for people that may not have the financial capitalization to support sort of a larger build-out. And at the same time, you know, we looked at our menu and said, well, we've had a menu for 50 years that we've, you know, incrementally innovated on over, and especially over the last decade or so, but we really never went, you know, what I call nuclear, right? So, let's kind of take what we, what we know that people really love and what we know people don't really love. And let's just, let's just chop it up and find out what people really want to introduce new menu items. And it's hard to do that in a system with our agent size without, you know, I guess, angering, at least a few customers along the way. So, this was an opportunity for us to say, okay, let's build it smaller, right? Let's focus on our premise where we know the industry is going. Let's look at our menu and kind of chop it up and reduce things that, you know, are not selling and bringing things that we know people are going to like. And then let's sort of use technology and data as an enabler for the, not just our team members, but also our guests. So, then it said, well, how do we do all this together quickly, efficiently without disrupting our core business? And so, that led us to, well, let's, why don't we just create a new format? And that's what led us to this new fast, what we call the fast, fine prototype because it's fine food and we really believe that done fast. It's, you know, so that was sort of the motivating factors behind it. And is this, I'm curious, is this format targeted towards, you know, new franchisees or current to build on to their portfolios or both? Both. We certainly see it as a growth vehicle for existing franchisees and especially in markets where we may have, let's say, you know, call it, let's call the hub and spoke model, right? So, you may have a mellum upstream in a particular city that has the larger expanded menu or full service bar, you know, full service model. And then we can have sort of spoke locations that are more of this counter service, fast, fine, more off-premise focus. So, we see it as a dual vehicle, but for existing franchisees and for new ones. And we see both continuing to grow across the United States and beyond. And I guess kind of backing up even a little bit further. So before you guys launched that, you kind of went through like a company-wide, repair brand the year before in 2023. Tell us about that a little bit. What were some of the biggest challenges, wins, goals from that process? Yeah. So, I think it's important to understand sort of for your listeners that may not be familiar with mellum upstream sort of how, what we stand for and sort of where, how we came about, because that really colors our brand refresh. And you're right. So, part of it also, Sam was, you know, we were kind of building the plan as we were flying it because, you know, in this day and age, who has time to spend two years, you know, working on a product and then launching it, right? You got to kind of do it all at the same time and learn as you go and then implement all those changes and learnings in your second prototype. So, we were kind of doing all this together at the same time. So, you're right. So, we launched our new brand wide refresh, completely new branding, and what we call Neutro. So, it's really taking the retro aspect of our brand, which as, you know, you may know in "Semory Listeners" made that we started in 1974 when really America was sort of at a cultural crossroads. You know, everything was about creativity, breaking the rules, and really embracing the individual. And our founders at that time, you know, from Georgia, from Atlanta specifically, and kind of took that mindset in the '70s and said, "Well, we're going to, we're going to be entrepreneurs, you know, they worked in pizza restaurants, they wanted to own their own pizza restaurants, so, well, how do we take this mindset and apply it to the restaurant space?" And that's exactly what they did. So, you know, we've never been a follower of rules when it comes to your traditional restaurant concept, right? So, what does that mean? So, every restaurant you go to nowadays, they typically, pick a brand, any brand, right? They typically look very, very similar. So, you could say one box, move it to the other side of the country, and it would look and feel the exact same. Mel and I never did that. You know, we were always what I call a snowflake brand, where we built locations, individual, and unique to the environment that they were in. And that was great. You know, that got us to where we are today, but as I mentioned earlier, with some of those rising costs and sort of the attention span effect that we have in our culture and society today, we needed a way to make sure that, you know, people recognize our brand instantly, but also that we kept that part of our brand that was sort of counter-culture, breaking the rules, embracing individuality, but bringing it into the modern day and age. So, that's where we developed Neutro and a freedom within a framework where we say, well, here's our brand, and here's our primary color palette, which we never had, by the way. Here's our tagline, which we never had, by the way, because we were so counter-culture that it was almost, it was fun because you almost, we wouldn't behave like a franchise restaurant. We behave like a collection of individual stores. And that's really where we, you know, with COVID was a blessing in disguise, and you know, people may argue with me on that, but that really what woke us up to saying, well, where are we today? It's our 50th anniversary coming up in a couple years. Here's where we are today. Here's some of the learnings we've seen from our own research saying, you know, people may not recognize that, you know, the mellow in their market isn't the only mellow out there, which is good because people love that mom and pop feel, but from a brand recognition and from a growth standpoint, that poses some challenges. So all that combined, we know we said, let's launch a new brand refresh and then let's build this new prototype. And let's kind of push it out there in the market and see how people react to it. And we've gotten great. I mean, just tremendous feedback from our franchisees and from our guests through our research. And now we're, you know, embarking on bringing our new branding from a digital only touchpoint now to the streets, as we're calling it. So new signage, all we're going through a remodel process with a lot of our locations to not going to make them cookie cutter, but we're going to embrace our new sort of formalized branding into the individuality of those locations. You know, Asan, I was wondering, you mentioned you got great feedback from franchisees, from customers, but I know I have to assume that with this kind of brand where it feels, has that mom and pop feel, you have very like individual, realistic, franchise owners. Was there any, you know, I feel like with any change, there's going to be a little bit of pushback? How did you kind of get them on the same page and convince them like, this is going to be good for everyone? Well, you know, you're absolutely right, Kelly, I mean, with any organization, you always have people that, you know, are dissenters, let's say, right? They, you know, whatever you do, it's never right or never good enough or, you know, you're always in the wrong. So, you know, with any, like with any system, we have that as well, but that's really where, you know, we let the data do the work for us. So we did spend a lot of time and effort, energy and resources doing a lot of research. So we did store design research, we did turf studies, you know, we did guest intercepts, we did focus groups and really, really we let the data kind of speak for itself with our franchisees. When they, when, you know, we got some pushbacks saying, well, you know, I love my signage, you know, I've had it for, I don't know, 15 years, you know, and people know me and people recognize us. And I'm like, yeah, that's great. People do. But the person that's never been to your restaurant, you know, that they may have gone to a millimushroom in a different location or a different state. We'll never know you're there because they don't can't recognize that you are the same, under the same umbrella of millimushroom, right? And then when we sort of showed the awareness opportunity that we had, aided and unaided awareness, and some of the other guest intercepts, and even, you know, we, we guest quotes, you know, and when we sort of showed that, it kind of really illuminated for our, our franchisees and our operators that, you know, it's time to evolve. No one's saying that they'll be at the bath with the bath water, right? No one's saying, you know, become this cookie cutter concept and just kind of stamp out millimushrooms and kind of make them look all the same. That we can, we can honor our heritage, but still do it in a way that's more modern and appeals to our current and future guests while continuing to grow the awareness of our brand. Because, you know, frankly, I'm biased, but our product is freaking fantastic, you know. So it's like, why not take this opportunity to then spread the knowledge and the awareness of this great product to everyone? And that's really what helped, you know. So at the end of the day, you know, we'll always have people that don't want to do, you know, the, what we're asking them to, but for the most part, our franchisees, you know, have all embraced this new branding and love it. So you know, a lot of the changes we've been talking about so far, kind of consumer-facing, the brand image, I'm curious, and you kind of touched on this earlier, you know, with the pandemic and all the digital acceleration. I guess I'm curious, what are some of the changes or advancements you guys have been zeroing in on from, you know, operationally, from the tech stack, back of house, that side of things? Yeah. No, that's a great question, Sam, because, you know, one of the first things we did when I joined the company was we took a holistic approach and said, well, let's do an evaluation of our entire tech side. Whether that be in restaurant, whether that be at the support center, you know, where we are as a franchise or whether it be Mark tech, right? And we've kind of laid it out to look, here's everything that we have going on in our ecosystem. And we started to sort of say, okay, well, how do we, how do we reduce this, because we realize what we have a lot of point solutions, right? We saw for X with Y, and while that can be great in certain instances, a lot of times what happens is now you have so many systems to manage, and yet you have to have the personnel to manage, maintain, train. That's really where, you know, the rubber meets the road, and people forget about it, well, it's not just about adopting a new technology, how are you going to do it on-going and make sure your franchise, these are adopting it if it's something that they're going to be using. And that's really where, you know, where we learned was what we have to simplify, right? And to me, one of my team's mandates in our organization mandates right now is, well, how do we make the lives of our team members and our GMs easier? Because, you know, as you guys know, five years ago, you know, there wasn't really, third party was growing, but it wasn't nearly the penetration that it is today, right? All my ordering was there, but not nearly the penetration that it is today. So now, as a GM, I'm not only, you know, an HR leader managing my team. I'm a marketing leader trying to promote my restaurant, I'm an operations leader. And now I have to manage five different channels in the restaurant and still do all the work I was doing before. So, you know, the lives of the GMs have become a lot more complicated. And that's really where we focus on what's our, how do we make the lives of the GM easier, which in turn will help them focus on their teams, which will then help their team focus on the guests, right? And it's kind of like the layered onion effect. Let's peel the onion back and figure out what's that the core, fix that, and then everything else will fall into place as needed. So, you know, we really narrowed it down to like three main things, I would say. So, from a team member standpoint, let's make the kitchen operations easier. So what does that mean? You know, we were, and still are in many cases, you know, chit-based in the kitchen. So we said, well, we have to get onto a KDS platform. So we can really track our speed of service. We know food quality can be, can be an opportunity for us, especially off-premise and timing of food. So we said, well, we got to get a KDS in there. So that's what we're working on right now with the phase rollout. We're also working on consolidating our, our back office system. So we, like I said, we had a point solution for inventory, for behind analytics, for scheduling and labor. Well, now we're kind of bringing that all under one umbrella. So if I'm a GM, I can log into one platform for my, you know, Monday morning admin day. And there is a nice workflow that I can follow. So even if I'm not a amazing top tier GM, or I don't have the experience where I'm kind of, I'm the bench strength is, if you will, I can learn and I can have a workflow that I can follow to make my life easier. And then you kind of layer in, you know, simplification efforts when it comes to menu, you layer in new equipment, you know, like, you know, RoboCoup, for example, for, you know, our prep stuff. And then, you know, you kind of layer in all these different things while still, you know, maintaining quality across all of our production, you know, that's really where you then have a lot of efficiency, and efficiency gains in the back of house, not to mention also, you know, things like the labor model, you know, we, we as an organization, you know, we let our franchisees sort of operate in many ways, you know, over the years, like individual restaurants. So, you know, we had a lot of autonomy and a lot of decision making at a local level. But we realized was that while that's great, we do need to provide a little bit more guidance than we had before. So, you know, we worked, you know, to the time in motion study, looked at every single little aspects. How often are people moving from point A to point B? You know, how is our kitchen layout, right? How much, how many steps are involved with every single menu item? How, how often is the pizza person idle versus really busy versus, you know, somewhat busy? So, we looked at all those different things and said, okay, well, here's the ideal deployment of our team members in the back of house and the front of house. So, you know, there's a lot of different topics there and I could talk about each one of those for an hour, probably, but those are some of the ways that we were trying to not only evolve ourselves from a guest spacing standpoint, but also the internal team member facing standpoint. You know, I feel like 2025 is like the year of AI, it's all I think one that like everyone wants to talk about. But, you know, obviously there's a difference between AI automation, all those things. How are you kind of thinking about, you know, AI and the restaurant space, you know, in general, how it can be used, how it should be used, how maybe it shouldn't be used? Yeah, so, you know, I'll go back to what I mentioned earlier in this conversation is, you know, chasing the shiny object, right? So, AI is definitely the shiny object today. And I think that there is a lot of basics still that the industry, and you know, I'll use us as an example, that we still had to work on and still are working on, getting, you know, very tight, let's say, right? So, basic things that I think are basic, right? So, for example, integrating your third party into your POS system, sort of a basic, you know, table stakes as part of your technology stack, getting, making sure you're online ordering experience is as best as it can be and making sure that, you know, how we execute it after the guest place in order is as best as it can be. So I think, you know, the first thing that, whenever someone talks about AI and the restaurant industry, you know, that's the first thing I ask is, well, how are you doing on the basic level first, right? Because if you can't execute the basic level, no level of AI really is going to be able to help you take that next step. So, that's sort of the fundamental thing. Then, you know, when it comes to AI, I think about it in three different ways. Now, the first is, how do we, we as the support center for our franchisees, leverage AI? And to me, that's a productivity tool, you know? So, I tell my teams, and, you know, we have more informal AI coaching in our organization, and the first thing I tell people is, if you have a question, don't Google it, use an AI tool. You know, perplexity is a good one. Chad GPT and Throbbing, there's a bunch of different tools. Just get in the habit of using the tool itself to ask those things that you would typically ask Google, because a lot of times, it can have a great conversation with you and help you brainstorm your idea. So, if you're writing copy for, let's say, an ad or if you are developing an agenda for a meeting or if you need to kind of just brainstorm, you know, different ideas about a particular topic, that can be a great tool for you as a franchise or, and as a support center. And then, I think the second part of that is, you know, is holding our vendors, vendor partners, you know, accountable, you know, because a lot of it is on them to implement some of the technology into the tools that we're already using. So, you know, I'll, I'll give a shout out to one of our partners, Tatl, you know, they've done a great job of integrating generative AI into our responses for reviews. So now, you know, we had a huge challenge before of having GM's respond to reviews, but the tone was off, right? It didn't feel mellow. It was all like my personal tone versus the brand's tone, which can have a pretty big impact on the overall perception of the brand for consumer standpoint. So, you know, the launch this tool when we joined with them mid last year, and now we have almost over a 90% response rate because it just makes the lives of the GM easier because we're leveraging AI from our vendor partners first before trying to create anything in-house. And then the third piece is, you know, how do we bring this over to our franchises? So, we're actually in the process of testing some localized, large language models within our existing technology infrastructure that we're feeding at our SOPs, our FDD, our franchise agreement, our recipes. So that becomes almost like an internal, we have an internet today, you know, but it's still search-based. So, now you have a conversational-based search engine that's learned on all the data that we've fed it. So, we're testing that right now. So, again, going back to my point earlier about making the lives of the GM easier, right? So, instead of having to dig through an internet to find the right file or find the right recipe or find the right SOPs, not going to have a conversation with an AI agent that can tell me those things like that, right? So, that's really how I see, you know, the AI conversation evolving. I'm always a proponent of buying and not building because especially in our industry, you know, at the franchise we're excited to, a lot of things that get forgotten are maintenance and upkeep and the ongoing costs of some of these items, right? So, it's always great to say, "Well, I'm going to build it, here's how I'm just going to cost, and I'm excited, and you roll it out." And then the next thing you know, two weeks later, something breaks, well, we didn't plan for this, right? So, the maintenance aspect of it, especially at the skillset required, to me, it does not make sense unless, you know, you are, you know, one of the larger conglomerate restaurant brands, you know, go to foods or young, you know, they had the resources to do that in house, but for the majority of the restaurant industry, I think it's best to leverage best-in-class vendor partners and leverage their expertise and bring that in house. You know, on that topic of like building versus buying, I guess, you know, there are so many solutions and options available out there, like just the conversation of restaurant technology can sometimes feel like a, like a can of worms, be overwhelming when you start looking at what kind of solutions do I need, you know, what's worth the investment, what isn't, what are like some questions you ask yourself, how do you kind of navigate just the like ever expanding array of options out there? That's a great question because you're absolutely right Sam, I mean, there are so many options that it's like, if I were to evaluate every single option for a solution I'm looking for, that's all I would be doing, you know, it's just evaluating, you know, different all-time jobs. That's a full-time job, right, which actually, you know, I do have someone on my team that it sort of does a little bit of that, so which is, which is helpful. You know, but I think the most important part of it is understanding what are you trying to solve for, right? I think it always starts with, ask the question first, right, it'll lead with why, you know, I think there's a great, there's a great book by Simon Sinai called, you know, start with why. Why are we, why are we even having this conversation, right? That's the first thing I try to start with as well. Whatever we're trying to do, if you're looking at, you know, that's, you know, software X or solution X, why are you looking at that, right? I don't care if you look at one or 50 already, why are you looking at that? Who, who are you trying to solve for? What are you trying to solve for, and how are you going to solve for it, right? So I think when you, if you spend a lot of, enough time, and I like to say a lot of time in the beginning part of this, and then the discovery part, and empathizing with the end user that's going to be using this product, whatever it might be, right? So if it's, let's say, a back off the system, well, I can sit here at the support center, you know, and say, well, this is what I think we should do. But if I don't put it in the hands of the actual operator, and in the hands of the GM, I'm only as good as what I think they want, right? And there is nothing really beats sort of having that conversation and understanding the pain points that the end user is experiencing, and then solving for those pain points. And then I think once you have that framework in mind, now you have a really good understanding of, here's what I have to have, the must have, and the nice to have, and that really helps narrow down who can help me with my half to have versus who is really focused on the nice to have. And that sort of helps, you know, consolidate that list down to, I select few partners. And then obviously, leverage your network, and that's why I love this industry is because everyone is always willing to help and have a conversation around, especially technology, because to your point, there's so much out there. So leveraging our network and saying, well, you know, have you done it, how have you experienced it? There's our tech stack match because that can be a great, it can be a great solution set, but it can also be an inhibitor to anything you're doing too. So I think that to me, that's how I approach it, but you know, without having a great understanding of what the users, problems, and pain points are, it's hard to select the right technology. But don't get me wrong. I think building works as well if it's something that's unique to you, right? So from our BI standpoint, you know, we built it, you know, from the ground up because we couldn't find a solution that did everything we needed to do. So we built our entire BI solution from the ground up and it's been great for us so far and it's been, you know, I can run it with the Lean team and we can grow with it as we need and as our business grows. I'm curious to get your take on, you know, where you think the next big, you know, solution in tech is going to be. I feel like we've had, you know, the real estate, like marketing demographics, data, information for a while now. What do you think is like the next thing people should be looking for? Yeah, I think, you know, to your point, you know, real estate has had a lot of investment over the years. We actually, you know, recently partnered with the company for our real estate needs. So a lot of, you know, modeling, data modeling, AI, a lot of machine learning sort of on the backend has been applied to that, which has been really helpful for site selection standpoint. I think recently, I think the MarTech stack has gotten a lot of attention and a lot of love from providers in the industry. One thing that comes to mind is, you know, a CDP, customer data platform that sort of unifies what I call a 360 view of the guest. So we can see, you know, when they come in, how often they come in, whether they buying and does a particular item that they're buying result in a repeat visit, right? So those, that's sort of layered understanding, but then taking that and activating it as a hyper personalized segment, I think that really is what the industry seems to be focused on right now. And I think it's hard to execute on that unless you have a great, you know, obtained to your loyalty program because it's hard to activate those segments oftentimes, but it's good to understand at a minimum, the activation can be a little bit of a challenge. So I think that's what the industry has been focused on. I would say probably for the last year or two years, I think what's going to happen eventually, you know, as we get more and more complex with our systems and our technology is a simplification. I think there's going to be a radical simplification that happens within the technology stack, especially at the restaurant level. I think there's going to be a even stronger move to more cloud-based systems and keeping in mind what happens when your internet goes out or your power goes out, but I still got to run a restaurant, right? So balancing that, but I think it's what I mentioned earlier. It's how do you make the lives of the GM easier because it's more and more getting, it's getting so complicated that without having that mindset, it's going to lead to a degradation of the customer experience. And I truly believe that, especially in the full service industry. So if you don't make the lives of the GM easier and simplify what they're doing on day-to-day basis, it's going to have a trickle-down effect into the team morale and how the team perceives the gas and the experience that they're providing. So I think over the next year to three years, there's going to be a lot of consolidation in the tech sector for restaurant-specific technologies and then a heavy focus on the operations than the people side of the operations. Maybe for more of like a personal standpoint throughout your years now in the restaurant industry, which it hasn't been too many in the restaurant industry, but what have some of your biggest learnings been? Yeah, I mean, I think it's, that's a great question. I think thinking like a CFO, and I think that's a lot of what, especially on the marketing side, right? So I work with our marketing leaders, I work with our finance leaders, with our operations leaders. So I kind of get to see how everyone thinks about what they're doing in the restaurant itself. But I think if you don't have the ultimate goal of improving the financial performance of the restaurants, I think you're thinking about it the wrong way. Because at the end of the day, I used to be in digital marketing several years ago, and I would have agencies say, "Oh, look, we have 20 million impressions and 50,000 clicks." I'm like, "That's great." But my P&L shows that I didn't drive a nickel-morn sales. So that's all great and all, but if I can't prove that this is helping my P&L for my restaurants, to me, it's almost like, well, what do we accomplish? So I think there's always a side to awareness and branding and all that, but I think if you're not thinking from a P&L aspect, I think you're missing out. And that's to me was the biggest learning, especially in the restaurant industry where the margins are getting thinner and thinner every day. You can't just continue to operate like you did in silos. Everyone has to think like a CFO, and I think that's to me has been the biggest learning. And honestly, it's been kind of easier for me because I do have an accounting and finance background, so it was, "Well, yeah, naturally, of course I'm looking at the P&L's, but most people don't." And actually, I'm not sure when the last time you guys looked at a restaurant P&L, it's not easy. I mean, if you're not used to doing this on a day-to-day basis, it can be very overwhelming. And trying to figure out what aspect of the P&L am I actually helping, hurting, and where should I be focused on? And so I think that's some of that is also training and going back to making the lives of GMEs here, so let's walk them through what they need to be focused on. But yeah, I would say, thinking like a CFO is sort of the biggest thing that I've learned being in the restaurant industry that surprisingly wasn't happening as much as I thought it should be. What's your sense of just kind of where things stand from a macro level for the restaurant world kind of looking out to the rest of 2025? You know, full service specifically, there's been some challenges, but there's also some silver linings. It's kind of been interesting to see how quick service and full service have been fairing. Just what's kind of your high level take of where we're at and where we might be heading? Yeah. You're right. I mean, it's like a tale of two worlds almost, right? There is, you know, I think everyone has seen sort of the performance with some legacy brands like, let's say Chili's, for example, most recently, and then some other brands on the other side of that coin, you know, like Applebee's, for example, right? So there's definitely a basket of, you know, let's call them winners and losers for today. And I do think it can be turned around. I do think we are going to continue to see an uphill battle with traffic. I do think that's just going to be an ongoing battle, especially as a political environment, you know, potentially leads to more higher prices, input costs and producer prices, which will trickle itself down into the end user menu pricing. Because I just don't think the restaurant industry at this point can absorb any more of those costs that have occurred over the last three, three to four years. So I do see traffic as a continuing opportunity. I think, I think the, and I hate really using the word value because every time you use the word value, you think of, you know, well, you know, it's all price based and it's not. And I really don't believe it's price based at all because people will pay for an experience that is holistic and that actually appeals to what I call the, you know, your sensory experiences. So does it taste good? That's, that's fundamental, right? Does it taste good? Did the people that I that served me or that I interacted with where they friendly, right? Did there was a restaurant clean, right? Did it smell good? Did it? How was the sound? How was you overall music and the lighting? I think all those things combined, but especially the food and the service really creates that value perception. So I think there has been value wars going on, especially in full service, right? I mean, I look at the dollar reader, for example, I was like, man, that is, that's unbelievable, almost, you know? But I don't think that has staying power because I think our consumer is smarter than they have ever been and they have something more options than they've ever had. So you're not going to fool them with a temporary discount, right? I think you have to execute on all levels of the multi-sensory experience, which, you know, I'll put a plug for Melo. I think we do a great job of that, you know, from all aspects of that multi-sensory experience. So if you don't hit on all those things, then you're going to struggle with the perceived value of what the guest is getting rather than just a written dollar amount that is typically used from a value equation. So I think, you know, to fight that traffic, we've got to be focused on all five of those multi-sensory experiences and then continuing to leverage data and personalization because, you know, the mass marketing is dying, I mean, you scroll through your LinkedIn feed even these days, right? So personalized. I'm like, man, this is getting a little too creepy now, so. But, you know, I think that personalization has got to be, got to be the way of the future. And that's where, you know, it got back to your question earlier, Cali. That's where AI can really help, right? Is how do you, then, in mass produce, you know, creative and copy that can be used for personalization without having to put a strain on resources in the internal teams? And I think that's going to be really where we see a lot of growth happening in our industry in 2025 and in 2016. Absolutely. Yeah, even, I mean, with our jobs, with copy, with coming up with brainstorming questions or SEO optimized, like headlines, things like that. It's a great tool that can be used with templates and things like that, but, you know, starting to wrap up here, you know, what is next for mella mushroom? I know you have a ton of growth in a lot of different areas. Can you give us maybe a snapshot of that growth where you're coming to next, things like that? Yeah. So, you know, we're at 166 restaurants today in 16 states. And hopefully, over the next, you know, let's call it the next decade, you know, we want to be in, you know, 40 plus states and, you know, 500 plus restaurants, you know. So, we have a lot of work to do to get there, but that's really where a lot of our time energy and resources are being spent on the sort of the franchise or side is really getting our, our investment model to something that is, that is really attractive for the multi-unit operators. And, you know, using our full service legacy brand, but then also this, this new fast-fine prototype that's lower input costs and, you know, smaller footprint, I think will definitely help accelerate that. And that's what we're really excited about and taking some of those learnings from that fast-fine prototype that we've implemented, you know, like, for example, even small things, right? Like, like kiosks. And kiosks everyone has kiosks these days, so I don't consider anything new or shiny anymore. But, you know, like we were talking about earlier, Sam, I mean, people are eating out and eating alone more often than they ever have, and that interaction is kind of become optional. Like, do I want to interact with someone as I'm getting my food or do I not want to do that? And for us, it's just, you know, we want to be able to offer how the guests want to use our brand and offer that to them, whether that be a kiosk, whether that be in person, whether that be on the phone, whether that be on the phone with a call center AI agent, you know, we've seen a lot of good success in our testing with that as well. So I think we're continuing to leverage, you know, technology and data as an accelerator, growing our full service footprint along with our fast-fine footprint, and then really making the lives of our GMEs here and making our guests happy through reduced friction and all across their entire customer journey. And you know, last but not least here, if any of our listeners are curious to learn more about Mellow Mushroom, stay up to date with what you guys have going on, how can they do so? Yeah, so at Mellow Mushroom is going to be our social handles, so you'll find us on the Meta platform, so find us on Twitter and TikTok, and also on LinkedIn. And then Mellow Mushroom.com and our news and community section, you will kind of get some more updates on the things that we're working on, and I'll be exciting times ahead for us. Fantastic. Well, thank you so much, Aeson, for your time, and thank you to all of our listeners out there. Stay tuned for more. [BLANK_AUDIO]

Podcast Summary

Key Points:

  1. Asanjeeva, the EVP of Strategy and Transformation at Mellon Mushroom, discusses his career journey and the impact of digital transformation in the restaurant industry.
  2. Mellon Mushroom underwent a brand refresh called Neutro to modernize its image while retaining its unique identity.
  3. The company launched a new counter-service model, the fast-fine prototype, to adapt to changing consumer behaviors and reduce operational costs.

Summary:

Asanjeeva, the EVP of Strategy and Transformation at Mellon Mushroom, shared insights into his career journey and the digital transformation in the restaurant industry. He highlighted the importance of leveraging data, technology, and customer experience to drive operational efficiency and enhance business performance. Mellon Mushroom underwent a brand refresh, Neutro, to modernize its image while preserving its unique identity as a counter-culture brand.

Additionally, the company introduced a new counter-service model, the fast-fine prototype, to cater to changing consumer preferences and reduce operational costs. By embracing digital innovations and focusing on enhancing the guest experience, Mellon Mushroom aims to continue thriving in the evolving restaurant landscape.

FAQs

The motivation was to adapt to changing consumer behaviors, reduce input costs, innovate the menu, and leverage technology for a more efficient operation.

The new model was targeted towards both new and existing franchisees as a growth vehicle for Mellow Mushroom.

The brand refresh aimed to modernize Mellow Mushroom's image while preserving its unique individuality. Challenges included balancing tradition with innovation, but the feedback from franchisees and guests has been overwhelmingly positive.

Mellow Mushroom used data-driven insights from store design research, guest intercepts, and awareness studies to convince franchisees of the need to evolve while honoring the brand's heritage.

Mellow Mushroom conducted a comprehensive evaluation of its tech stack, including in-restaurant, support center, and marketing technology, to enhance operational efficiency and customer experience.

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