Threat of restaurant-data regulation grabs the focus at FSTEC

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Technology’s infiltration of restaurants and the lives of their customers is posing a new and dangerous test for the industry: Can it figure out the protocols and best practices to ensure the guest data generated through digital innovations won’t be misused, or will government have to intervene as a protector?

That question echoed through the packed Orlando, Fla., ballroom hosting FSTEC, a conference for the restaurant users and suppliers of technology. Past installments of the annual conference provided attendees with a glimpse of what’s next in hardware and software, from self-driving cars to phone-based staff scheduling programs and robotics. Data was the focus of Day One at the 2018 event, with speaker after speaker noting the industry is facing a number of challenges about what to do with the reams of personal and behavioral information collected about guests.

That data paints a vivid picture of customers and their preferences, arming smart operators with insights only a mind reader might otherwise enjoy. “I know a lot of things about our loyalty members,” said Sherif Mityas, chief experience officer for TGI Fridays. “[When] I have someone walking in who always orders a Long Island iced tea, I can actually say, ‘Welcome back, Terry. Do you want your Long Island iced tea?’ Terry has never met that greeter before.”

The intimacy fostered in that manner will foist some tough calls on restaurant operators, agreed participants in a show-opening session on managing data. Will guests regard that degree of customization as a form of extraordinary service, or will they blast it as Big Brother run amok?

“The greatest challenge will be finding the balance between technology that is creepy and technology that is enabling,” said Mike Wior, CEO of Omnivore, a company that aggregates and interprets store-level data.

Even thornier, agreed the panelists, is the issue of who controls the data. They noted that California passed a law in June that essentially serves as a bill of rights for customers whose data is collected by businesses like restaurants. The Privacy Act of 2018 provides consumers with the right to request an accounting of precisely what personal information about them is being collected, how it’s being gathered, the way that information is being used, and who has access to it, either gratis or for a fee. In addition, consumers can have the information deleted upon request and can stipulate that the business cannot sell any collected information.

The measure takes effect in 2020.

In many respects, the law parallels the landmark privacy measure that was adopted by the European Union in May, the General Data Protection Regulation. It, too, is intended to provide consumers with the ultimate control over the data that’s collected about them and used to predict their consumption preferences and behaviors.

Restaurateurs can expect to see similar laws in the United States unless the industry develops voluntary guidelines for ensuring transparency on how consumer information is gathered and used, said Terry Erdle, COO of the National Restaurant Association. “We have to figure out how to bring parties together to say, ‘How do we regulate this?’ Because otherwise someone else is going to regulate it for us,” he said.

Right now, Erdle continued, there’s not enough trust between the key stakeholders—customers, restaurants and technology suppliers—to collaborate on voluntary guidelines. “We have a ways to go,” he said. “We’re not going to get anywhere truly for the benefit of the guest, unless we trust each other.”

Fridays’ Mityas agreed. The industry’s greatest tech challenge, he said, is “How do we come together, so it’s not your data, my data, our data, it’s the guest’s data. How do we come together to make sure it’s not used for evil, but used to improve the guest experience?”

FSTEC is being hosted in the Rosen Centre Hotel through Oct. 3. The event is presented by Winsight, the parent company of Restaurant Business.

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