Restaurant Tech Talk: AI Delivering Profits With Dave Dittenber Of BYOD (Ep 158)
Great episode with Dave Dittenber, CEO of BYOD, on how their AI tech is helping restaurants operate more profitably. In addition to running a tech company, Dave is an operator of several concepts in Michigan so he's dealing with all the same issues and challenges that you face at your restaurant.
We got into:
- How Dave grew up in and fell in love with the restaurant business
- How COVID has impacted their various operations
- Ways they pivoted and adapted to successfully navigate the crisis
- The foundation and starting point for BYOD
- How long-time operators look at increasing efficiencies to boost profits
- Why having too many different types of technologies is bad for your restaurant
- How getting the tech to talk to each other is a big win
- How emerging technologies like machine learning and AI are helping to make real-time decisions
- How their Alexa like MABEL assistant is helping restaurants with their operations
Lots of good stuff! Check it out.
Find out more at https://www.byod.ai.
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Watch the episode here
Listen to the podcast here
Restaurant Tech Talk: AI Delivering Profits With Dave Dittenber of BYOD
We've got a great restaurant tech episode with Dave Dittenber, CEO of BYOD, which stands for Bring Your Own Data. Dave, welcome. Thanks for joining me.
Jaime, thanks for having me. I appreciate it. It's good to be here.
I want to get into his tech because it's interesting but before we get there, Dave is a long-time operator and has several concepts. Tell us about your operator background, where you are geographically, and what's going on in your restaurant marketplace.
Dave Dittenber's Operator Background
I've been in operations all my life. I started in a dish pit in a small town in Michigan and graduated with 23 people. I think I worked for all three restaurants in the hometown that I grew up in. That was between delivering pizzas and washing dishes, that was the start. Just grew to it, fell in love with it, and have had haven't left it. I went to school to be a doctor, got accepted to med school, and then told my parents, “I think that I want to, go back into the restaurant business.” That was 1997.
I moved back from Grand Rapids where I went to school in Michigan to Bay City, where we opened our first restaurant there called, Old City Hall. I have been on the operation side since 1997. Since then, we've been getting ready to open our 6th place, in the Great Lakes, Bay region, and then we manage a couple of other concepts. The concepts are all, American, different concepts from barbecue too, all-table service. We love being here. Still love the industry. It's great.
Impact of COVID-19 On Operations
Let me check in with you on where we are. We're sitting in January 2022. All the restaurants have gone through a lot. I believe Michigan probably locked down pretty hard, but you can correct me if I'm wrong. Where are you guys now operationally? What did you go through? What did COVID mean to your places? A sit-down place, probably selling a lot of beer or alcohol as well. What was it like?
The first week, Saint Patrick's Day in Bay City is one of the iconic outdoor festival days for us. Even if it's cold, people come out in droves, and that was the week the shutdown happened. The parade got canceled. My senior management team, and were all sitting in a room on Saturday night. The parades are always on Sunday.
We were looking at each other with blank looks on our faces asking, “What are we going to do?” That was the start of it. A week later, I guess, we're getting some direction, but it was as you mentioned, our table service. How do you adapt? What do you do? People talking about things like dine-outs, and takeouts, which wasn't a huge part of our business.
We had to adapt quickly, made some good tech upgrades early in the process, and did things handhelds and QR code-related items, went that whole concentration on takeout and things like that, which was not in our realm, and it had never been part of that business before. They did a great job. We were shut down a lot.
Probably close for half of last year for inside service and then mostly limited. It was difficult. Then you get reopened. We got shut back down before Christmas. It's hard to keep staff motivated, let alone in the places just because there wasn't the inside business. We adapted quickly. We did some fun pop-up stuff on anything with takeout.
Once we got back into the summertime when we could get back outside, the city, the state, the municipalities, or the associations helped us close down the street we could take a lot of that business outside. You had to be quick to adapt. You had to be very flexible and, frankly, you decide on one thing in the morning and by that evening, you were probably doing something different.
You had to be quick to adapt, and you had to be very flexible. Frankly, you might decide on one thing in the morning, but by the evening, you were probably doing something different.
My staff and my team just dug into it. We were able to keep everything open and then, as I said, get ready to open a new one. I feel very fortunate but it was a challenge. There were a lot of blank stares in the mirror sometimes but it seems to be improving. Everywhere else right now, it's spiking. You can see the decline in business. At least when we know, we have to flip those buttons, we can do that. That's been good.
I appreciate you sharing the story there and the pivot in the story was when it first happened, changed, and adapted. You're funny. Start the day, but you end the day with a different plan. The same day. I'm sure that it's exactly how it was. What's interesting about the lesson for operators and I hope it's one of the few silver lines that came out of it.
We've learned how to make money outside of the restaurant from the takeout delivery operations. You say that you didn't do much before, and you probably looked at yourself and have to say, “Why didn't we do this before?” It was just business that we just left on the table because everything was easy before.
People just came in and we served them. You're realizing then when that doesn't happen that you lost some opportunities. Hopefully, even when you get back full open, when you did or when you do again, you don't want to lose that other piece too. Now, you know how to do that. You've figured out how to deliver stuff to the curb.
Hopefully, those lessons stick with us. Let's transition with that over to the tech. It sounds like you did some tech adaptations through this process and BYOD may have been in the works before that or it may have been during this time. Give us a story of the company, its derivation, and how that came about.
The Role Of Technology And The Birth Of BYOD
The tech company started before that. Again, it was always from the operator's point of view. I will tell you that I think a lot of opportunities came through the pandemic from the operation side, but also from the technology side because of the adaption of technology in the industry that used to be very slow, now people were looking for whatever they could.
Many opportunities emerged during the pandemic, not only on the operations side but also on the technology side.
Then, to go along with labor shortages and things like that, you had to adapt on that side of it as well. It was in the works, but I would say that we were scheduled to launch commercially in May 2019 at the NRA show. When you started to look at all that thing, that March through June thing was a big time for us where the brakes got put on not by us, but we had to adapt quickly.
The thing was from an operational point of view, my technology at one point. We looked at our platforms within our restaurant, we had 17 different pieces of IOT in technology and nothing spoke with one another. A lot of dashboards, we'd sit down at a P&L meeting, six or eight weeks later and talk about what happened, and no one could put those dots together.
The idea was, could we use emerging technology machine learning and AI, and be able to bring those pieces of technology together, then come out with real-time decisions that needed to be made instead of looking at it six weeks in the future? The whole idea is, as those technology streams come together, Mabel, our virtual assistant, is letting the operator know, “Cut this person. Send this person home. This needs attention.”
It was something that we developed a lot more, number one because we had the time to be able to do that as things tapered off a little bit from a business perspective. Also, from a development point of view, it allowed us to be able to get time with some restaurants, some franchisees, and some people so that we could understand a little bit more about their use cases and adapt the technology for that. It's been another opportunity on the tech side to be able to have access and reshape what the business is going to look like in the future.
A couple of things come to mind. One is the fact that you have five or six operations yourself to test the technology on, to have the operators in your, stable. They say, “This is a challenge. How do we fix or test it?” Not like you're launching something out to the public that has to be perfect and has to be ready. You can just throw it out there. Bing ping pong. Was that part of it?
One hundred percent. We were lucky to have several colleagues in a close circle that we were able to give it to people before we were throwing that out to the commercial market. Our commercial launch is in April 2024. We're still finishing up a beta phase right now. We tested the tech, went through, and did some strategic partnerships with other companies to do API integrations and things like that.
All those opportunities, while you had some of this downtime, we were able to test it in our place and different models of the business, things like takeout and things that we weren't normally looking at from a development point of view. It was a good opportunity for us to test it in our markets, but also then access people just because of this situation.
Now, you mentioned Mabel and if you go to their website, it's BYOD.ai. If you watch a video, there's a fun video. It's about 2 minutes with Dave, going through a scene in the restaurant but Mabel and my correlation will be Alexa. Everyone knows Alexa. I'm sure it's probably going to play something in the background. There's one sitting over here anyway. You're talking to it and it assists us. Tell us more about that because people are getting more familiar with talking to it whether it's, “Hey, Siri.” “Hey, Google.” “Hey, Alexa.” In your case, “Hey, Mabel.” What's up?
My co-founder, Frank Loics. I live in Midland, he was a former architect on the data side for Dow Chemical. It's Frank was big into big system integration. Love the idea of emerging technologies, whether it is voice, vision, or image. Again, when it comes to decision-making in anything, you have to be able to bring some of those different mediums to be able to process, if you will.
Real-Time Intervention with Mabel
That's why a lot of the systems, it's easy to bring certain types of data in, but it's not very easy to bring other types of systems in. Frank wanted to architect a solution that could bring all of those together and be able to allow BYOD and Mable to make the best decisions. You hit the nail right on the head with Alexa. Amazon, our platform is built on AWS. They're a partner of ours.
Alexa is built on that same platform. I'm not going to say it because if I do, she'll activate and start to talk to me right now but you would go and do that through the video that's done through the Alexa pod. Mabel is just part of that platform. In the restaurant setting, she not only takes in information, but she can give information back out.
She's giving feedback to the employees in real-time through voice, but then also through text and email depending on the nature or what level of priority needs to be communicated at the right time. It's all a real-time interventional type of thing. It was built on that same type of idea, which, again, that's what the world is using now.
Something like 40% of restaurants before the pandemic hadn't made a technology upgrade in 7 years, and I thought that was the craziest. Even the craziest stat that I'd heard. Now, those those pieces of technology like Alexa pods, were commoditized. They're easy to use, and those are things that I think from an operational level, they're cheap to implement.
Before the pandemic, 40% of restaurants hadn't made a technology upgrade in seven years.
Versus a lot of this big-time system integration where it was just expensive for operators to use. We wanted to be able to use things like those that were easy to access but also very affordable. Whether it be an independent or a multiunit franchisee could invest in hardware that could be, , relevant. That was the whole philosophy behind it.
It's great because the technology is affordable these days. If you built this system 20 years ago, it would have cost $17 trillion, and no one could do it except for McDonald's or something like that but now everybody can kind of dig in, and that's what's exciting. Two examples I remember from the video. One was to pay attention.
People are waving their credit cards. They want to pay, pay attention to them. In other words, that looks like business is slowing down. You can cut bang bang bang from the system. It's making these recommendations as you said in real time. I think that aspect of it to me is the most interesting that it's happening, right now, and you can act on it. Is that one of the one of the best features you think? What do you what do you think? Yeah.
That's a differentiator for sure. We like to say that dashboards are dinosaurs. If it's a report, somebody has to sit down and generate a report, run a report, and interpret a report, whereas, 99% of that information either takes skill and experience or what have you to go in and dig through that to be able to find out what the reasons are versus, “Go do this now. That's what needs to happen.
AI or Artificial Intelligence, I like to call it Augmented Intelligence. We're working with our people in a training-related way. I like things like automation. Don't get me wrong, but I believe augmentation is the realistic way to be able to keep hospitality intact and just the cost. You mentioned that. Sure, there are a lot of things that you'd love to do. A lot of great ideas that have come out of the pandemic.
Augmentation is the realistic way to maintain hospitality while managing costs effectively.
I believe that if the moon is aligned, the data tells somebody to do something and they miss that point, it goes on for an hour a day or what have you. Those errors will still keep adding up to, negative effects to the bottom line versus, “Do this now instead of reading it in a report later.” I believe that is the advantage that we have, that real-time intervention.
You can see that very quickly. They could make a difference. I want to go back for a second, you said that you had 17 pieces of tech, and I do imagine that. We do interviews on a whole bunch of spectrums. I remember one of the things when the 3rd party deliveries were getting big, and they talked about every single different one having a tablet.
Now you're talking about this email platform that loyalty program and this POS system. You can imagine the overload of data coming in. It's important to have but it's like garbage in, garbage out. If you can't use it or if you can't utilize it, what's the point of it? I think that is the case where people have a lot of different pieces coming in.
They're not utilizing it the way they could. This sounds, I'm just going to use for lack of a better word, a hub. It all comes in. Boom. Now it can all just have one shootout. What did you see when you talked to other clients? Was it similar? It may not be 17 pieces, but did they have 7 things, 10 things? What's going on?
The similarity is, that you mentioned the Point Of Sale. I think the heart heartbeat of the restaurant data is through the Point Of Sale systems. There are a number of those out there. There are a number that continue to launch. Everybody now seems to be going to digital scheduling, digital checklist, and stuff like that. All those platforms are different. Again, I think the word, Hub, is great. We like to use, Brain.
That idea of bringing into the brain. Then you have to have a system that can accept that. I think that's where a lot of the integrations are difficult. We wanted an agnostic system. We don't want to build anything. We want to go out there and partner with companies like Homebase, Innovation, Marquee, and people who are already building great pieces of equipment. Just take their information and allow it to be able to be fed into BYOD.
Then you had the idea, when we started this that a lot of people were still doing a lot of nondigital things. They were still using a lot of paper, and things like that were to your point, garbage in, garbage out. On the other side of it, what we saw when we took a lot of those data points was some of those things were important.
If you had 80% of your checklist done and you had, X, Y, and Z, that equated to better sales and better customer scores. Several points needed to be digitized that just never came together in the brain, if you would. It was interesting for us to do a lot of that data science correlation beforehand and to know which points were important when we went in to bring digital sources in. When you look at labor, you need Point Of Sale.
We like the camera integration. Not just from a somebody's here or somebody's there. You mentioned the credit card example. When there's an obvious need for something to be seen, no one's going to sit there and go through a reel of digital video to look for somebody who was on a credit card. Once that moment's gone, you need to tie that with the moment that's current versus in the past. It's something like that. We just felt that it was underused, and many people had them in their restaurants.
You don't need new hardware with this either. Our whole thing was, if you have a camera system, we have a great vendor, Eagle Eye that you can go in and just get a $250 bridge. It's very minimal. It's agnostic to different types of equipment and then, you can get that information into a common hub or brain that can start working for you. It’s just continuing to give you more reports and more data daily.
Super exciting space that you guys are in. As we start to wrap, I know you're in Michigan. You have a basketball in the background. Big sports area. Are you a Michigan fan or what do we get?
Michigan fan. To my friends on the Michigan Restaurant and Lodging Board that I sit on, there are 2 Michigan fans about 30 Michigan State. Michigan basketball and Michigan football, I grew up watching all that. I didn't go to school there, which I take a lot of crud for sometimes but there's a Michigan helmet over there somewhere, I think, too.
They had a good year. They made the top 4 there. A great classic game we were talking about just before we started recording. That snow game against Ohio State. That was a classic. They had a good season there on the field. As we close, go ahead and send them to a website, social, or anything else where they can find out more information about you guys.
Again, the website is BYOD.ai. We're on LinkedIn. It's BYOD and on Instagram. Check us out. There are some spots to communicate with us and look for operators that have different use cases or just want to talk about the marrying of tech and restaurant operations. We'd love to engage with some new people.
I appreciate it. Certainly, the way that tech and operations are heading is to get smarter, find points in the system, and grab profits back. It's a skinny profit margin business, we have to use tech and everything around our operations to get better. Exciting stuff. I appreciate you. Folks, that was Dave Dittenburg of BYOD. Make sure to check them out on the web at BYOD.ai. For more great restaurant marketing, operations, service, people, and tech tips, be sure to stay tuned to us here at RunningRestaurants.com. We'll see you next time. Thanks much, Dave.
Thanks a lot, Jaime.
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