Cafecito Pt. 2: Streamlining your Services

How do you choose what services to offer and what to get rid of?

That was the question facing Cafecito when they started thinking about changing their menu. They liked serving brunch, but it was expensive. Some items looked like obvious cuts: low margins, low order volume, clearly those weren’t helping the business. But they had the same question as so many of us: what if those under-perfoming items are secretly driving sales in other areas?

Maybe people only buy coffee because they come in for the croissants. Get rid of the croissants and no one stops by for coffee.

To find out, we ran a basket analysis, a technique for identifying which products are purchased together and how they drive secondary sales. We learned that:

• Brunch offerings were powering coffee sales. Customers weren’t substituting between products: if brunch disappeared, so would their coffee orders

• Promotions focusing on natural product pairings (like a brunch plate + specialty latte combo) boosted overall ticket size

This saved Cafecito from removing the menu items that were the key pillars of their sales. Instead, they adjusted portion sizes slightly to bring the cost of brunch items in line with the rest of their menu. 

We all know menu changes are necessary, yet changing prices or offerings is intimidating. You can’t change your business model then bring back the same services a week later. You have intuitions, but what if they’re wrong? That’s where good data analytics comes in.