The Business of Eataly: How Restaurants & Retail Drive Revenue Together

The Business of Eataly: How Restaurants & Retail Drive Revenue Together

There’s a motto at Eataly, the enormous, awe-inspiring food hall with locations in New York, Chicago, Boston, Los Angeles, Las Vegas, Toronto, and Dallas. It’s “Eat, Shop & Learn,” and it sums up the business model perfectly: visitors can come in for a sit-down meal at a restaurant, stay and shop the same products they just enjoyed, and recreate the dish at home themselves.

The space is stocked with walls of dried pasta, olive oil, balsamic vinegar, and other staples of Italian cooking. There are fresh ingredients, too, including meat and fish departments staffed with butchers and fishmongers, as well as a place to buy fresh and stuffed pastas. And then there are full-service restaurants—some that even take reservations.

To learn how the business works behind the scenes, we talked to Kevin Gil, Senior Director, Multi-Store Operations at Eataly. Here’s how each part of the company works together to build the business, drive revenue, and delight guests.

Eat

Eataly’s restaurants are typically specialized—there’s a pizza and pasta concept with authentic Neapolitan pies; a fish and seafood concept; and a vegetable concept focused on seasonality and simple preparations.

Most restaurants are first-come, first-serve, but there are also more formal restaurants in each location that follow a traditional reservation model. Because the restaurants are one part of a larger dining, drinking, and shopping experience, they rely heavily on waitlist management. People may grab a glass of Prosecco at the piazza while waiting for a table at La Pizza & La Pasta. They’ll get a text when their table is ready.

“It’s our job to keep people in the building—let them explore other parts of the store, and be as accurate with our quote times as possible and get them seated as soon as we can,” Gil says.

Because there are multiple concepts under one roof, the Eataly staff can give guests more options than most restaurants would be able to. (If there’s no table for eight available here, there might be a few steps away.) Each restaurant is set up as its own profit center, so the team looks at sales, labor, and costs for each one. And while there is a bit of friendly competition between the restaurants, the ultimate goal is to keep guests at Eataly.

“They’re still dining in our restaurant, they’re still getting a high-quality product, and the revenue is still under the Eataly umbrella. In the end, the goal is that the guest has an enjoyable experience at Eataly.”

Shop

The retail component of Eataly operates somewhat independently from restaurants. Orders are placed across the shop and restaurants, and when they come in they are allocated accordingly between restaurants and retail. And the “Eat, Shop” relationship allows Eataly some flexibility: if a restaurant is running low on a cut of meat, they can take from the butcher’s stock. On the flip side, if there’s overflow in one retail area, they can find a way to use it in the restaurants.

“It allows us to avoid 86-ing anything off the menu because we have so many different resources,” says Gil.

Learn

Customers at Eataly include both tourists and locals, as well Italian wine experts and those who have never heard of Sangiovese. That presents a huge opportunity for the staff to tell guests the stories behind the products and, hopefully, for guests to take their favorite discoveries home.

Educating visitors starts with educating the team. When opening a new store, Gil conducts three to four weeks of in-depth training with employees on products, bringing in experts on cheese, olive oil, and pasta making, as well as a house sommelier. The whole staff learns from classes, manuals, and constant reinforcements during pre-shift meetings.

It may sound strange to hold a pre-shift meeting while people are walking in front of you with shopping baskets, but Gil relishes the interaction.

“We encourage people walking around to come and listen to what we’re talking about,” he says. “It’s an education piece—somebody can leave the store feeling like they’ve learned something. And it’s an opportunity for a sale.”

Aside from pre-shift meetings, servers are trained to use their product expertise to help guide guests in their shopping experience. Guests may be sitting at a table ten feet away from a shelf holding the exact pasta they just enjoyed in a restaurant, so being able to share in-depth knowledge about the products goes a long way.

“My most pleasant experiences on the floor are with people who have never been to Eataly, who don’t drink Italian wines, who are looking for guidance from us,” says Gil. “We’re based on quality and education, and bringing that retail aspect gives us more room to expand on the intricacies of our product.”

Adapt

Multi-concept spaces are popping up across the country, and Gil likes to think the trend has caught on thanks to Eataly’s success. “It definitely works,” he says.

At the same time, there’s no playbook. That means plenty of opportunities for experimentation and evolution, and a constant need to stay fresh and relevant.

In Chicago, for example, many people asked for a restaurant with more variety, instead of the specialized concepts they started with. They adapted a meat-focused restaurant to include pasta, vegetables, and fish, so that large groups of guests could find something for everyone.

There’s one thing Gil is sure of: adventurous diners are out there looking for new, varied experiences, and that’s another reason non-traditional restaurants have gained popularity.

“People always want to change and experience new things, so multi-outlet concepts like this provide a different experience every time you go in. You can come into Eataly 20 times a month and have 20 different experiences. That’s what we’re offering.”

Photos courtesy of Eataly.