What you need to know:

• After a wildly successful transformation program for the tired Contiki Tours business, Katrina Barry, backed by big names and a new funding round, is racing for a global top three position in on-table ordering systems.
• The hospitality sector is wedded to service from humans despite the data from Me&u showing surging levels of customer satisfaction and takings when tech takes over the grunt work with characteristic efficiency.
• Venues using the Me&u table tech see, on average, increased takings of 30 per cent. Merivale has notched incremental increases in bill size of 38 per cent; the 3,000 capacity Felons Brewing Co in Brisbane has slashed wait times for drinks from eight to three minutes.
• Venues are reworking their layouts to include split kitchens and dark bars (not for public ordering) to speed up service times and increase takings.
• Barry says Me&u will ultimately become a data and insights company, helping venues with AI and smart UX to tap emerging hot products and 'premiumisation' – the current rage in the UK for pornstar martinis (passionfuit added) will hit Australia this summer, she predicts based on her data.
• Still, there remains a challenge for Barry’s team convincing parts of the hospitality sector that fast service underpinned by tech and analytics, not friendly bar staff wanting to chat, is where future growth lies.        
• Get the full strength, heady mix via the podcast. It's refreshingly frank.

Big names, big game

Justin Hemmes and his Merivale Group is a big fan of a little device on his bar and restaurant tables known as a “Billy” in Australia or a “puck” in the US which is up-ending the hospitality sector’s long alliance with humans – and increasing customer spending by nearly a third. 

Whether it’s Hemmes as the king of cool bars and restaurants in Sydney, the Felons 3,000 seat pub in Brisbane’s Howard Smith Wharves or another giant venue in Texas called the Truckyard Alliance, the Australian start-up Me&u is using tech to blow up two standout customer pain points: waiting to get served and paying the bill. On the latter, Hemmes and Merivale has seen average spend increase 38 per cent since the Me&u “Billy” landed. 

Me&u CEO Katrina Barry says the average incremental spend increase in the markets it is rapidly expanding into – Australia, US and the UK – is 30 per cent. And customer happiness is booming. 

Barry – who started at McKinsey & Co early in her career before a host of gigs with Virgin Group and a wildly successfully transformation of Contiki Holidays – completed a series C funding round for Me&u last year and is now leading a global push to ensure it is one of the last three or four at-table ordering systems that currently number in the hundreds.

So powerful is the Billy at improving customer service – read ordering and service wait times – that large venues are now redesigning their facilities with dark bars and split kitchens to take the heat off the front end, hack bar queues and food order wait times. 

The giant Felons Brewing Company in Brisbane has slashed wait times from an average of eight minutes to three. “Having Me&u on the table, people are absolutely ordering more,” says General Manager Jimmy Gold in a piece of content marketing from Me&u – content marketing was a killer play for Barry in her previous role overhauling a tired Contiki product for the young and internationally restless. “There is a point where hospitality has to keep up with technology,” per Gold.

Bar chit-chat no more

It's a point Barry relentless stays on message around, for good reason. There remains an anachronistic undercurrent in the hospitality sector wedded to service from humans, despite the data from Me&u showing surging levels of customer satisfaction and takings when tech takes over the grunt work with characteristic efficiency – along with the data and analytics trail it leaves. Indeed, Barry thinks Me&u within two years will be as much a data insights company as it is a more efficient customer service gateway. More on that in a bit. First, Barry has to break conventional thinking in an addressable market of $250bn in consumer spending across large format venues in the US, UK and Australia, where it already controls 70 per cent of the market. 

“Hospitality has always said this is a people business,” says Barry. “I want to chat to the barman or it's all about the interaction with a waiter. But tech is really challenging that because during Covid it was super fun to do a pub quiz on Zoom on a Friday night ... for one week ... and then we all got bored of that. And when I went out, I didn't want to talk to the waiter or the server. What I wanted to do is talk to my mates that I haven't seen for forever. Technology is transforming what hospitality is really about and it's about connecting with your family and friends who you've gone there to meet, not spending 20 minutes waiting for a beer.”

"The biggest objection we have is like ‘oh, no, my customers really want to talk to me’,” says Barry. “And I agree if you're going to Rockpool, you want to talk to the sommelier, you want to have a white glove experience. But if I'm at a Merivale pub with my mates, unless I'm 22 and trying to pick up – I don't think they do that anymore, they do it on Tinder – it's actually about having a good time and getting as many Aperol Spritz’s as you can. There's been a general resistance in the industry to move away from that, but I think it really depends on the venue type and what the customers are there to do and how society is evolving.”

Me&u’s tech stack is all built in-house although it plugs into dozens of point-of-sale and CRM systems. Last week Barry was speaking at the giant Salesforce World Tour event in Sydney.

Morphing to a data and insights company

Although much of its engineering is in-house, Me&u has borrowed heavily from ecom and nudge theory in how it crunches data to personalise and tier offers to each user – and discovered that faster ordering and service, coupled with clever UX, leads to higher margin choices. Offer customers Gin & Tonic with the option of premium Fevertree tonic for 50 cents extra and most will choose Fevertree. But at a dollar, people revert to Schweppes.

It's these learnings which has Barry pointing to me&u’s future beyond the Billy and puck. 

“Long term I think this business is going to be a data insights business because of the level of information that we capture to help venues get smarter about their customers and what they provide,” says Barry. “It’s a business transformation tool. Hospitality often hasn't had a lot of insight from their customers other than the verbal feedback that they get in the venue. And it's certainly not an industry that has fully embraced quantitative analytics, if you will.

“You start with the faster, better experience for venues and customers alike, but how that delivers better personalisation and a better customer experience – and how you drive revenue more as a venue – you have to use the data and the insights. That is where the power will be, because data is useless unless you know what you're going to do with it. You can have as much data as you like. Unless you understand the insight and pull out the actions from that, then it's a complete waste of time.”

Barry says it’s inevitable data, analytics and AI will be a central part of the hospitality ecosystem – so how do algorithms drive personalisation for a venue? “When I walk into a venue in years to come, it should know, ‘hey, Katrina, you and the kids are here. Do you want the same as what you got last time?’ One click, boom. Thank you very much. And that is absolutely what I want when I take my kids to a restaurant."

Pornstar martinis

Another example of of how Barry thinks Me&u’s charter will shift to data and analytics is what she predicts will be the rise of pornstar martinis for next summer in Australia, based on what she’s seeing as the biggest mover in the UK market. 

“It’s a passionfruit martini – that's all it is. But it's delicious, don't you worry. And that was super big, according to my friends at Merivale like ten years ago. But I can guarantee you next summer that is going to be the biggest one here: The pornstar martini. Because everything goes in cycles, so you want to get ahead of that premiumisation," says Barry.

People are still spending Covid savings. But as consumer spending starts to wind back as rate rises bite, data insight will set winners and losers apart, Barry suggests.

"Hospitality is absolutely booming right now for two reasons. One, people are appreciating getting out and connecting. But secondly, people appreciate the finer things when they're doing it. So for example, I know that in terms of gins, people are buying up the same as vodkas. Premiumisation of the drink purchase and the food purchase is absolutely happening across this industry. So for example if the most common thing was a standard beer or a house glass of wine, it is now all about cocktails – and people are spending big money on that," she says.

"We know the analytics now and the price elasticity and the preferences of how you rank your vodkas. So which one do you have the highest margin on and what is most popular right now? That insight is what I think is going to become valuable to this industry in the future is when customers are going to be put under [inflationary] pressure.”

So does Barry really think she can monetise Me&u’s data to the same level as clipping 1.5 per cent of each order going through the table device across an addressable market of $250bn?

“I’m the CEO darling. I’m thinking about how to monetise everything,” she quips, indicating that strategy will roll out well within two years.

Cashing out

Which leads clearly into the possibilities of an IPO or some sort of sale in the future.

“You never know what the future holds,” she says. “What we're doing right now is going into the UK, into the US. It's hard. It's hard taking Aussie companies overseas. Everyone thinks it's easy, but I've done this before. I know that it's really difficult, so we've got a long way to go. Our investors really like our unit economics and where we're going. We're mainly private, high net worths and as you said, the deities of tech and hospitality from Australia are backing us and we've got our first institutional money on, so I think we've got a pathway to go. It's fast moving but I'm old school – steady, efficient and focused on the unit economics and we'll be just fine."

So sale or float? 

"You never know."

Get the full strength, heady mix via the podcast. It's refreshingly frank.