I'm not pushing any particular company, just that you build your email marketing infrastructure and competency. Build your list, use your list.
List building. Offer something free on a regular basis (free lunch, free catering, new menu item). "Join our list and you could win" eliminates some of the barriers to joining.
Also, train counter and wait staff to suggest joining. Concepts that ask customers to sign up at the point of sale increase their lists faster and have better contacts.
Enable customers to join in multiple ways. A business card is the most common, but what about moms? Create a sign-up sheet with boxes for each letter - it improves readability when it comes time to enter them.
Choose a provider. There are rules and laws associated with email marketing. One of them is the ability to opt out at any time. This is not something you want to manage on your own. Constant Contact and Fishbowl are two companies that offer software.
Determine what you need from your provider. If you just need list management and the ability to send good looking emails, Constant Contact is a solid solution. You can segment your lists and send as many messages as you want for a fixed price. If you have franchisees who need access to the system, need the ability to monitor the messages of others, and maintain brand standards, a more inclusive provider, such as Fishbowl, is a better choice.
There are a bunch of providers, these are only two. Use the popular search engine Google to find one that fits your needs and your budget.
It's not all about pictures. Email gives you the ability to show food and pretty pictures. But remember that many email clients don't show images in emails by default and security settings often block them out. If your message is really a graphic add that you cut up and send via HTML, many of your customers can't read it. Use text. It works.
Wednesday
Monday
The benefits of email marketing
There's a right way and a wrong way to do email marketing. Done right, it can not only increase frequency of visit, but also increase ticket average, put butts in seats and, whether you're a franchise or a single-unit operator, increase the value of your business.
You just need to set your expectations as to what it can accomplish for your unit.
Increase awareness. Email marketing is inexpensive compared to other media and should be used to augment existing efforts. If you're posting billboards and running ads, email becomes an additional contact. Unless there is an offer in the mail you likely won't spur traffic, but you can increase awareness among existing users for new products, catering services, dayparts, and community involvement.
Drive sales. I just said you likely won't drive traffic with email, but that's if you use it as an additional contact and for frequency of message. If you add an offer (free drink for the first 20 people today, BOGO this Saturday only, 10% off catering orders of $100 or more) you can spur sales within a defined period.
Increase frequency. The people getting your message are existing customers. Use email to drive menu trial (you love our burgers, but have you tried our chicken?) and increase frequency of visit. Combine with an offer to get customers to come back within a few days, or to try carry-out, or cater a meal.
Increase sale price / value of business. As a franchisor, your email database is an asset. Having thousands of names and email addresses raises the value of your organization because you have the infrastructure and process to consistently communicate with your customers. As a single-unit operator, the value is increased for the same reason, but also because you appear to have a more intimate connection to your customers - something for which a prospective buyer will pay a premium.
You just need to set your expectations as to what it can accomplish for your unit.
Increase awareness. Email marketing is inexpensive compared to other media and should be used to augment existing efforts. If you're posting billboards and running ads, email becomes an additional contact. Unless there is an offer in the mail you likely won't spur traffic, but you can increase awareness among existing users for new products, catering services, dayparts, and community involvement.
Drive sales. I just said you likely won't drive traffic with email, but that's if you use it as an additional contact and for frequency of message. If you add an offer (free drink for the first 20 people today, BOGO this Saturday only, 10% off catering orders of $100 or more) you can spur sales within a defined period.
Increase frequency. The people getting your message are existing customers. Use email to drive menu trial (you love our burgers, but have you tried our chicken?) and increase frequency of visit. Combine with an offer to get customers to come back within a few days, or to try carry-out, or cater a meal.
Increase sale price / value of business. As a franchisor, your email database is an asset. Having thousands of names and email addresses raises the value of your organization because you have the infrastructure and process to consistently communicate with your customers. As a single-unit operator, the value is increased for the same reason, but also because you appear to have a more intimate connection to your customers - something for which a prospective buyer will pay a premium.
Saturday
Franchise intranet system
Communication with your franchisees is half the battle when it comes to supporting them. Face to face and by phone is best, but time consuming. It's also NOT best when it comes to routine questions and becomes very inefficient for your limited staff.
Email is not real-time, making it more efficient in some cases but it's also one to one. Another franchisee with the same question gets a similar email, but your staff doesn't get economies of scale. Email can be one to many, when you're the one initiating the communication ("remember to put up your ad campaign materials"), but not when franchisees are the ones asking the questions.
Email is also a difficult way to post new information. Updates to the ops manual, vendor lists that change often, new forms and tools - who has the most recent and who needs a new one?
A franchise intranet system is another tool for your franchise support people that makes them twice as efficient as before. They can post the latest forms and documents, answer franchisee questions so that others can read the answer too, builds a knowledge base for franchisee self-support, and enables your staff to focus on the troubled units.
Your concept is NOT too small to have an intranet. Big or small, you have the same issues. It's part of the infrastructure you need to support units, maintain your brand, and ensure consistency of operation.
Email is not real-time, making it more efficient in some cases but it's also one to one. Another franchisee with the same question gets a similar email, but your staff doesn't get economies of scale. Email can be one to many, when you're the one initiating the communication ("remember to put up your ad campaign materials"), but not when franchisees are the ones asking the questions.
Email is also a difficult way to post new information. Updates to the ops manual, vendor lists that change often, new forms and tools - who has the most recent and who needs a new one?
A franchise intranet system is another tool for your franchise support people that makes them twice as efficient as before. They can post the latest forms and documents, answer franchisee questions so that others can read the answer too, builds a knowledge base for franchisee self-support, and enables your staff to focus on the troubled units.
Your concept is NOT too small to have an intranet. Big or small, you have the same issues. It's part of the infrastructure you need to support units, maintain your brand, and ensure consistency of operation.
Friday
Email marketing for franchises
Restaurant owners, and most small franchise companies, tend to miss out on one of the most important parts of the advertising mix: email marketing.
I've seen lots of reasons for this. Fear of technology, or ignorance in it's usage; lack of understanding as to the benefits or email; unrealistic expectation of results; lack of money.
As a stable part of your marketing mix, email marketing provides regular contact, more impressions, and should play more of a supporting role to your other efforts. It gives you a chance to contact your existing customers one more time (or two more times) about your special price point, your new entree, your community involvement, or your expanded daypart. It's a chance to remind customers, to incentivize them, to call them to action.
Too many small franchises, selling to single-unit operators, don't even mandate that a computer and Internet connection be present in the unit. Many of their Z's don't check email, or have an AOL account. Often franchisors know the value of email advertising, but can't get their franchise partners on board.
The next few posts will help to make the benefits of email marketing clearer, and offer some solutions to getting set up to be easy and automatic, getting franchisees on board, and increasing the value of your company.
I've seen lots of reasons for this. Fear of technology, or ignorance in it's usage; lack of understanding as to the benefits or email; unrealistic expectation of results; lack of money.
As a stable part of your marketing mix, email marketing provides regular contact, more impressions, and should play more of a supporting role to your other efforts. It gives you a chance to contact your existing customers one more time (or two more times) about your special price point, your new entree, your community involvement, or your expanded daypart. It's a chance to remind customers, to incentivize them, to call them to action.
Too many small franchises, selling to single-unit operators, don't even mandate that a computer and Internet connection be present in the unit. Many of their Z's don't check email, or have an AOL account. Often franchisors know the value of email advertising, but can't get their franchise partners on board.
The next few posts will help to make the benefits of email marketing clearer, and offer some solutions to getting set up to be easy and automatic, getting franchisees on board, and increasing the value of your company.
Wednesday
Increase Ticket Average with Variable Offers
I've worked a lot of retail. Every place I have ever worked we've always played the same game: who can get the highest sale today/this shift/this week. We'd create friendly competition between ourselves to see who could get folks to add more to their purchase.
Here are some of the ways we'd outdo each other:
- Cross-sell, upsell. Kind of an obvious one, but we were pretty damn good at it. Belt to go with pants (and then the shoes). Not THAT belt, this belt. I found I get better at these things when there was a reason to be good (ie: bragging rights or lunch from the manager).
- Variable offers. Back in the days before scanners we put stickers on everything. Stickers fall off or they're taken off or they don't get marked-down in a timely manner. It was a crappy system, but it offered the ice-breaking question: "How much is this?"
The answer to that often depended on how much was in their basket. I might be willing to give 10% off the item just to get it out of my store, but we could get more out of each customer if we got creative:
*It's $25, and I'll throw in [fill in something you've been trying to clear out] for free.
*I'll give you 10% off if you get the blank that goes with it. (Smart shoppers would ask for 10% off both the item AND the blanket. The answer is YES.)
*If your total is more than $50 I'll give you $5 off of that; if it's more than $65 I'll give you $10 off.
*For you? 25% off, but don't tell anyone.
The trick was to get more from someone. We knew we were making money off of the customer, so percentage after their initial purchase wasn't as important. Now it's about contribution to the bottom line.
In a retail environment this is not just good for the sale, it's great for building a relationship. "For you it's 15% off", "it's free if you'll buy one of these", "I throw in another one at half price just for you".
In a restaurant, the tactics change a bit but the concept is the same. Sample desserts at dinner, other food in line. Comp the coffee if they'll get the dessert. Whatever. There are as many ways to do it as their are consumer tastes. That's what makes it so easy to do.
This is where the art of retail / restaurant comes in. Awaken the PT Barnum in you.
Here are some of the ways we'd outdo each other:
- Cross-sell, upsell. Kind of an obvious one, but we were pretty damn good at it. Belt to go with pants (and then the shoes). Not THAT belt, this belt. I found I get better at these things when there was a reason to be good (ie: bragging rights or lunch from the manager).
- Variable offers. Back in the days before scanners we put stickers on everything. Stickers fall off or they're taken off or they don't get marked-down in a timely manner. It was a crappy system, but it offered the ice-breaking question: "How much is this?"
The answer to that often depended on how much was in their basket. I might be willing to give 10% off the item just to get it out of my store, but we could get more out of each customer if we got creative:
*It's $25, and I'll throw in [fill in something you've been trying to clear out] for free.
*I'll give you 10% off if you get the blank that goes with it. (Smart shoppers would ask for 10% off both the item AND the blanket. The answer is YES.)
*If your total is more than $50 I'll give you $5 off of that; if it's more than $65 I'll give you $10 off.
*For you? 25% off, but don't tell anyone.
The trick was to get more from someone. We knew we were making money off of the customer, so percentage after their initial purchase wasn't as important. Now it's about contribution to the bottom line.
In a retail environment this is not just good for the sale, it's great for building a relationship. "For you it's 15% off", "it's free if you'll buy one of these", "I throw in another one at half price just for you".
In a restaurant, the tactics change a bit but the concept is the same. Sample desserts at dinner, other food in line. Comp the coffee if they'll get the dessert. Whatever. There are as many ways to do it as their are consumer tastes. That's what makes it so easy to do.
This is where the art of retail / restaurant comes in. Awaken the PT Barnum in you.
Saturday
Selling Restaurant Gift Cards
I'm working with a bunch of concepts now who are pushing their gift card systems very hard. It's a good time of year to do this, but I'm wondering how effective we actually are at selling gift cards and whether we could do a whole lot better.
Food for thought (*disclaimer: I'm not making a case for or against gift cards; I just want to take a closer look at some things that seem contradictory in consumer behavior):
- Do you like to RECEIVE gift cards for food? Honestly. Do you like someone choosing the restaurant for you? Is it awkward to know how much they spent on you?
- Who gives you these cards and for how much? Assuming you're an adult, are these cards given to you by your kids (in the amount of $5? $10? $20?)? Are they from your boss? From a vendor or a client?
- Do you prefer to receive a card for a specific place, or do you like chains / groups of restaurants better?
- Do you GIVE gift cards from the heart, or because they're pretty cool to get and because they're unisex? Do you CHOOSE a card for someone special, or do you purchase a bunch and hand them out to those on your list?
- When giving food cards do you purchase a couple of $20 cards, or a bunch of $10 cards?
- Who purchases (multiple) $20 gift cards? Salespeople, purchasing for clients? Pharm reps? Real Estate agents? Essentially, what is our target audience for higher ticket cards?
I suppose it depends on the type of restaurant, they uniqueness of the food, and the type of clientele (lunch, dinner, High Schoolers?), but there seem to be multiple reasons to purchase these things, yet we push them in a one size fits all manner.
I'd love to know your thoughts, it's this type of input that makes new programs work and old ones work better.
Food for thought (*disclaimer: I'm not making a case for or against gift cards; I just want to take a closer look at some things that seem contradictory in consumer behavior):
- Do you like to RECEIVE gift cards for food? Honestly. Do you like someone choosing the restaurant for you? Is it awkward to know how much they spent on you?
- Who gives you these cards and for how much? Assuming you're an adult, are these cards given to you by your kids (in the amount of $5? $10? $20?)? Are they from your boss? From a vendor or a client?
- Do you prefer to receive a card for a specific place, or do you like chains / groups of restaurants better?
- Do you GIVE gift cards from the heart, or because they're pretty cool to get and because they're unisex? Do you CHOOSE a card for someone special, or do you purchase a bunch and hand them out to those on your list?
- When giving food cards do you purchase a couple of $20 cards, or a bunch of $10 cards?
- Who purchases (multiple) $20 gift cards? Salespeople, purchasing for clients? Pharm reps? Real Estate agents? Essentially, what is our target audience for higher ticket cards?
I suppose it depends on the type of restaurant, they uniqueness of the food, and the type of clientele (lunch, dinner, High Schoolers?), but there seem to be multiple reasons to purchase these things, yet we push them in a one size fits all manner.
I'd love to know your thoughts, it's this type of input that makes new programs work and old ones work better.
Thursday
Holiday Greetings (and other ways to boost restaurant sales)
I've said it before, and folks like Jeffrey don't like it a lot but the numbers prove him wrong, that putting butts in seats, regardless of how you do it, has long term value. Spike trial, show 'em how good you are, treat them right, invite them back - get them more often.
You can't have frequent customers until you have customers. Many a post has been written about why this is and why it's not crack, and you can continue the discussion at our local store marketing forum, but for now let's just figure trial / frequency pairs that modify behavior and boost sales. Now might be the only time for a while that people loosen their purse strings. Time to grab a little share.
- Free catering for 5 people. It's a sampling of your service at a time when businesses are ordering catering for larger groups. It's pretty common to hear "How much if we have 20 people?"
The result is a 25% discount to someone who wasn't already a customer, but now will be long term. You can't take percentages to the bank.
- Free app to groups of 4 or more (increase party size). No restrictions on this - only struggling businesses and tight-wads put parameters on this kind of hospitality.
- Black Friday = Triple Punch Day. Frequency punch cards are crack if used incorrectly, but GOLD if you do it right. This does it right - don't let people eat somewhere else on the day they are most likely to blow their budgets!
- Every customer for 3 days (Friday, Saturday, Sunday after T'giving) gets a bounce-back coupon: BOGO with a 7 day expiration. If they're in your place twice within 7 days this time of year, more power to them.
- FREE dessert tray with every catering order. You've heard of loss leaders? You make it back. I promise.
- Gift Cards - you can sell $20 worth to someone (a stretch for some fast casual places) OR you can sell 10 - $5 cards to someone who has a lot of people to buy for (people for whom they'd rather not buy)
Think like a customer, not like an owner / manager.
You can't have frequent customers until you have customers. Many a post has been written about why this is and why it's not crack, and you can continue the discussion at our local store marketing forum, but for now let's just figure trial / frequency pairs that modify behavior and boost sales. Now might be the only time for a while that people loosen their purse strings. Time to grab a little share.
- Free catering for 5 people. It's a sampling of your service at a time when businesses are ordering catering for larger groups. It's pretty common to hear "How much if we have 20 people?"
The result is a 25% discount to someone who wasn't already a customer, but now will be long term. You can't take percentages to the bank.
- Free app to groups of 4 or more (increase party size). No restrictions on this - only struggling businesses and tight-wads put parameters on this kind of hospitality.
- Black Friday = Triple Punch Day. Frequency punch cards are crack if used incorrectly, but GOLD if you do it right. This does it right - don't let people eat somewhere else on the day they are most likely to blow their budgets!
- Every customer for 3 days (Friday, Saturday, Sunday after T'giving) gets a bounce-back coupon: BOGO with a 7 day expiration. If they're in your place twice within 7 days this time of year, more power to them.
- FREE dessert tray with every catering order. You've heard of loss leaders? You make it back. I promise.
- Gift Cards - you can sell $20 worth to someone (a stretch for some fast casual places) OR you can sell 10 - $5 cards to someone who has a lot of people to buy for (people for whom they'd rather not buy)
Think like a customer, not like an owner / manager.
Monday
FREE Holiday Marketing Ideas
Two old sayings come to mind this time of year, in this type of economy:
1. Volume solves everything.
2. You can't take percentages to the bank.
My next few posts will give a nod to one or both of those statements. I'd rather have a ton of customers with a low ticket average than the reverse - more mouths to spread the word, more chances to gain wallet share. And if someone comes in twice in a single week, regardless of the reason, I'm happy. Stupid couponing is, well, stupid. Modifying behavior, trading value for value, will win you long term customers.
I've mentioned loss leaders, today I list some promotional ideas that both drive traffic and show commitment your community.
Black Friday: 10% of sales, all day, to toward [insert local cause here]. Some finer points here:
- the higher the percentage, the more PR you'll generate (start now)
- use the distribution list of the cause, get their current supporter to spread the word on your behalf
- make it a news story
- put a banner up out front
December and Beyond:
- drop off place for coats for kids, or toys for tots
- bonus points if you're part of a franchise / co-op and use your radio ads to promote
- distribute coloring sheets that have a space for a "Santa List" (bonus points if it can be folded in such a way that Santa's address is already on the sheet)
- place a North Pole Postal Service mailbox in your lobby
- get in the spirit: make sure you and your staff are having some fun; give away candy canes, wear Santa hats, be jolly (dammit!)
Next up: some food promotions that will help to increase frequency and ticket average.
1. Volume solves everything.
2. You can't take percentages to the bank.
My next few posts will give a nod to one or both of those statements. I'd rather have a ton of customers with a low ticket average than the reverse - more mouths to spread the word, more chances to gain wallet share. And if someone comes in twice in a single week, regardless of the reason, I'm happy. Stupid couponing is, well, stupid. Modifying behavior, trading value for value, will win you long term customers.
I've mentioned loss leaders, today I list some promotional ideas that both drive traffic and show commitment your community.
Black Friday: 10% of sales, all day, to toward [insert local cause here]. Some finer points here:
- the higher the percentage, the more PR you'll generate (start now)
- use the distribution list of the cause, get their current supporter to spread the word on your behalf
- make it a news story
- put a banner up out front
December and Beyond:
- drop off place for coats for kids, or toys for tots
- bonus points if you're part of a franchise / co-op and use your radio ads to promote
- distribute coloring sheets that have a space for a "Santa List" (bonus points if it can be folded in such a way that Santa's address is already on the sheet)
- place a North Pole Postal Service mailbox in your lobby
- get in the spirit: make sure you and your staff are having some fun; give away candy canes, wear Santa hats, be jolly (dammit!)
Next up: some food promotions that will help to increase frequency and ticket average.
Tuesday
Restaurant Marketing on Election Day
Restaurant Marketing from some of the finest. Don't tell Jeffy - he'll think it's crack marketing:
Krispie Kreme is offering a free star shaped doughnut with patriotic sprinkles. www.krispykreme.com/storelocator.html
Shane's Rib Shack is giving out a free three-piece chicken tenders, fries and 20-oz. Drink. www.shanesribshack.com/locations.asp
Starbucks is offering a free tall cup of freshly brewed coffee to voters. www.starbucks.com
Chick-fil-A restaurants will be giving away free chicken sandwiches on election day. www.chick-fil-a.com
Ben and Jerry's will be offering a free scoop of ice cream. www.thefreebieblogger.com/ben-jerrys-free-scoop-of-ice-cream
Of course, in Georgia that will get you a $5,000 fine.
Most of these companies modified their offer to be free for the first "x number" of customers. Shane's was first 300 customers, I believe CFA was all day (not confirmed, but projected by GNN [smile]).
Krispie Kreme is offering a free star shaped doughnut with patriotic sprinkles. www.krispykreme.com/storelocator.html
Shane's Rib Shack is giving out a free three-piece chicken tenders, fries and 20-oz. Drink. www.shanesribshack.com/locations.asp
Starbucks is offering a free tall cup of freshly brewed coffee to voters. www.starbucks.com
Chick-fil-A restaurants will be giving away free chicken sandwiches on election day. www.chick-fil-a.com
Ben and Jerry's will be offering a free scoop of ice cream. www.thefreebieblogger.com/ben-jerrys-free-scoop-of-ice-cream
Of course, in Georgia that will get you a $5,000 fine.
Most of these companies modified their offer to be free for the first "x number" of customers. Shane's was first 300 customers, I believe CFA was all day (not confirmed, but projected by GNN [smile]).
Monday
Loss Leaders
When I was 14, working for my parents in their drug store, one of my jobs was to cut the headlines off of yesterday's newspapers and put them into an envelope, throwing the rest of the paper away.
We'd sell 10-15 per day on average, but we always got 20-25 and though the job wasn't difficult, it was repetitive and ever-present. I couldn't understand why we wouldn't eliminate an opening-chore that was only worth about $1.
That's when I learned the concept of a loss leader: something that brings customers into the store, sometimes at a loss, to either sell other items, introduce customers to the store, or create habits (which leads to selling other items).
Now I see that tactic everywhere. Jeffrey the Marketer calls it crack marketing, but McDonald's runs 39 cent cheeseburger specials (probably a break-even), Kroger sells milk and bread at really low prices, Chick-fil-A sometimes offers free drinks or dessert, cellular providers give the phone away, creedit card companies offer 0% financing...
Sometimes it's easy to determine your "loss" offer, sometimes it's not so easy (a coffeehouse, for example, is a harder sale because the leader isn't necessary to the customer). Either way, getting butts in seats, by hook or by crook, is the first step to having frequent customers.
We'd sell 10-15 per day on average, but we always got 20-25 and though the job wasn't difficult, it was repetitive and ever-present. I couldn't understand why we wouldn't eliminate an opening-chore that was only worth about $1.
That's when I learned the concept of a loss leader: something that brings customers into the store, sometimes at a loss, to either sell other items, introduce customers to the store, or create habits (which leads to selling other items).
Now I see that tactic everywhere. Jeffrey the Marketer calls it crack marketing, but McDonald's runs 39 cent cheeseburger specials (probably a break-even), Kroger sells milk and bread at really low prices, Chick-fil-A sometimes offers free drinks or dessert, cellular providers give the phone away, creedit card companies offer 0% financing...
Sometimes it's easy to determine your "loss" offer, sometimes it's not so easy (a coffeehouse, for example, is a harder sale because the leader isn't necessary to the customer). Either way, getting butts in seats, by hook or by crook, is the first step to having frequent customers.
Thursday
Jeffrey the Marketer
McCain has Joe the Plumber, allow me to have Jeffrey the Marketer.
Jeffrey isn't a symbol of hope for restaurants, he's a symptom of futility. He's looking for the silver bullet that will enable him to buy his own island, keeping his hands clean the whole time. Jeffrey is an ivory-tower marketer, all 'brand' and 'polish' and culture.
Now don't get me wrong, I'm a brand and polish and culture fan, too, but I don't look down my nose at shaking hands and kissing babies. A coupon has a purpose and the right offer can modify behavior and begin new habits (habits that benefit you).
Gaining market share can be a dirty business, but Jeffrey thinks it can happen via shiny magazine ads instead of rubbing elbows with the hoi polloi.
Jeffrey thinks all you have to do is extol your virtues and present images of what the consumer wants to be. If you do that, surely the customers will eventually try your food and they'll love you and you'll have them forever.
I'm glad there are Jeffreys in this world. Given the choice of competition, especially in this economy, I want a competitor who is all about branding because my brand is me.
In this economy I want someone who relies on awareness-based advertising because I'm going to give customers an offer that puts butts in seats (my seats).
At the end of 2006, there was one restaurant for every 662 people in the US (depending on how you define 'restaurant'). Thanks to the poor economy, that number has gone up and is likely to go up further. Poor locations are first to go, but the Jeffreys of the world are next.
Go get yourself some market share from the Jeffreys near you.
Jeffrey isn't a symbol of hope for restaurants, he's a symptom of futility. He's looking for the silver bullet that will enable him to buy his own island, keeping his hands clean the whole time. Jeffrey is an ivory-tower marketer, all 'brand' and 'polish' and culture.
Now don't get me wrong, I'm a brand and polish and culture fan, too, but I don't look down my nose at shaking hands and kissing babies. A coupon has a purpose and the right offer can modify behavior and begin new habits (habits that benefit you).
Gaining market share can be a dirty business, but Jeffrey thinks it can happen via shiny magazine ads instead of rubbing elbows with the hoi polloi.
Jeffrey thinks all you have to do is extol your virtues and present images of what the consumer wants to be. If you do that, surely the customers will eventually try your food and they'll love you and you'll have them forever.
I'm glad there are Jeffreys in this world. Given the choice of competition, especially in this economy, I want a competitor who is all about branding because my brand is me.
In this economy I want someone who relies on awareness-based advertising because I'm going to give customers an offer that puts butts in seats (my seats).
At the end of 2006, there was one restaurant for every 662 people in the US (depending on how you define 'restaurant'). Thanks to the poor economy, that number has gone up and is likely to go up further. Poor locations are first to go, but the Jeffreys of the world are next.
Go get yourself some market share from the Jeffreys near you.
Monday
Dakota Blue, 6 Feet Under, Applebee's
Intown neighborhoods are usually pretty tight groups. They're a lot like the suburbs I grew up in where neighbors know each other and when someone is sick the social network springs into action to supply meals and support.
Case in point: Dakota Blue in Grant Park. They work with a local church so that, when the church is scheduling meal drop offs to a family that has recently had a death, a birth, or a traumatic experience, they call him first.
He volunteers for the first night. He cares about them, they care about him. (Another restaurant I work with does this same thing and has received at least 3 catering orders specifically because he does this for the church.)
Six Feet Under rose to the occasion when the Grant Park Conservancy was restoring a fountain. Donate $2 and get a cut-out fountain to write your name on and post to the wall (like Shamrocks for MD). Cheesy, a little. But the local press picked it up and the local residents already knew he was doing it.
Lastly, Applebee's franchisees report increased customer loyalty due to community involvement and events, of which the company did more than 15,000 last year. A company spokesman said that franchisees are "involved for all the right social reasons" but "we also think there's a very strong strategic reason to be involved."
If you're not involved with your community, or you don't have a local store marketing plan for your restaurant...why not?
Case in point: Dakota Blue in Grant Park. They work with a local church so that, when the church is scheduling meal drop offs to a family that has recently had a death, a birth, or a traumatic experience, they call him first.
He volunteers for the first night. He cares about them, they care about him. (Another restaurant I work with does this same thing and has received at least 3 catering orders specifically because he does this for the church.)
Six Feet Under rose to the occasion when the Grant Park Conservancy was restoring a fountain. Donate $2 and get a cut-out fountain to write your name on and post to the wall (like Shamrocks for MD). Cheesy, a little. But the local press picked it up and the local residents already knew he was doing it.
Lastly, Applebee's franchisees report increased customer loyalty due to community involvement and events, of which the company did more than 15,000 last year. A company spokesman said that franchisees are "involved for all the right social reasons" but "we also think there's a very strong strategic reason to be involved."
If you're not involved with your community, or you don't have a local store marketing plan for your restaurant...why not?
Thursday
Wachovia...Stealing Your Money?
A couple of examples of how to surely piss your customers off and guarantee that, if you do make it through the financial slump, you won't have any customers left when you reach the other side.
Wachovia has apparently started taking payments for lines of credit (unsecured lines of credit), and presumably for credit cards, out of savings or checking accounts without customer approval. If the payment is late, they just reach in and help themselves. Hopefully that won't mess your automatic payments up too badly.
Not sure I would allow those foxes to be in charge of my chickens.
Example number two: blaming the customer, calling them thieves, liars, or idiots, won't win friends or influence people.
A local franchisee of a regional chain has posted signs that he will not accept BOGO coupons in his unit. Apparently the coups were distributed by another franchisee and a few of them have made their way south. Customers who try to redeem the coupons, which expired earlier this week, are confronted with angry counter staff.
When you turn away a coupon, you're effectively telling the customer you think they're either too stupid to read (wrong unit, expired coup) or you think they're a cheat ('you're trying to pull a fast one on me!').
You want to engender negative word of mouth, the easiest way is to call your customers cheating idiots.
Behold! The power of word of mouth!
Wachovia has apparently started taking payments for lines of credit (unsecured lines of credit), and presumably for credit cards, out of savings or checking accounts without customer approval. If the payment is late, they just reach in and help themselves. Hopefully that won't mess your automatic payments up too badly.
Not sure I would allow those foxes to be in charge of my chickens.
Example number two: blaming the customer, calling them thieves, liars, or idiots, won't win friends or influence people.
A local franchisee of a regional chain has posted signs that he will not accept BOGO coupons in his unit. Apparently the coups were distributed by another franchisee and a few of them have made their way south. Customers who try to redeem the coupons, which expired earlier this week, are confronted with angry counter staff.
When you turn away a coupon, you're effectively telling the customer you think they're either too stupid to read (wrong unit, expired coup) or you think they're a cheat ('you're trying to pull a fast one on me!').
You want to engender negative word of mouth, the easiest way is to call your customers cheating idiots.
Behold! The power of word of mouth!
Friday
Being Better Neighbors
Rubio's Mexicana Grill offers spirit nights and fundraisers for local schools and organizations. The key to their increased customer counts during such events - give away a higher percentage. 10%-15% is standard, but Rubio's goes up to 20%.
"It brings more people in," says Larry Rusinko, senior vice president of marketing and product development.
I think the trick here, and something that Mr. Rusinko has clearly grasped, is that the effort is the same whether you offer 10% back to a charity or organization, but the return is so much different. Goodwill, customer support, and charity/organization satisfaction (along with that of your own), are much, much higher when you don't skimp on the donation.
Think like a customer, not like an owner. Give away what you would want to receive, not what you're hoping to get away with.
Case in point, Shane Thompson, Shane's Rib Shack, used to donate a night's tips to a local charity, cause, or person in need. He would match the "employee contribution" from the tip jar out of the till every night. Customers on subsequent weeks would ask when he was going to do it again, and would thank him for caring about the community.
That's customer loyalty. Don't let anyone tell you different.
"It brings more people in," says Larry Rusinko, senior vice president of marketing and product development.
I think the trick here, and something that Mr. Rusinko has clearly grasped, is that the effort is the same whether you offer 10% back to a charity or organization, but the return is so much different. Goodwill, customer support, and charity/organization satisfaction (along with that of your own), are much, much higher when you don't skimp on the donation.
Think like a customer, not like an owner. Give away what you would want to receive, not what you're hoping to get away with.
Case in point, Shane Thompson, Shane's Rib Shack, used to donate a night's tips to a local charity, cause, or person in need. He would match the "employee contribution" from the tip jar out of the till every night. Customers on subsequent weeks would ask when he was going to do it again, and would thank him for caring about the community.
That's customer loyalty. Don't let anyone tell you different.
Monday
Community Giving: Fight for the Cure
Grand Traverse Pie Co. ran a promotion where a certain percentage of sales went to the Komen Research Foundation. Beginning on National Pie Day in January and ending on Mother's Day, company representatives said that sales were up about 10% during a time of year that is normally a lull in the pie business.
Apparently there are some franchisees won over to the dark LSM side.
PJ's Coffee did something similar. Not only did a franchisee sponsor the Relay for Life and back it up with their own store team, but they sold coffee at the event (proceeds to the event) and took donations in-store.
Community goodwill, and a little press, went a long way toward increased customer counts lasting for more than a month.
Delta Air Lines has a big pink plane, flight attendants don pink uniforms during the month of October (men wear pink pocket squares) and they sell pink lemonade onboard flights to support the Breast Cancer Research Foundation. Their employees want to be involved and Delta is supporting the causes their employees support.
Next up, how all of this giving actually increases sales (imagine that).
Apparently there are some franchisees won over to the dark LSM side.
PJ's Coffee did something similar. Not only did a franchisee sponsor the Relay for Life and back it up with their own store team, but they sold coffee at the event (proceeds to the event) and took donations in-store.
Community goodwill, and a little press, went a long way toward increased customer counts lasting for more than a month.
Delta Air Lines has a big pink plane, flight attendants don pink uniforms during the month of October (men wear pink pocket squares) and they sell pink lemonade onboard flights to support the Breast Cancer Research Foundation. Their employees want to be involved and Delta is supporting the causes their employees support.
Next up, how all of this giving actually increases sales (imagine that).
Give to Get
Apparently it's catching on. In our little in-town neighborhood, restaurants giving to charities and organizations is pretty much par for the course. It's how things were when I was growing up (1970s), too.
But bigger and better were all the rage. "I'll just advertise and then BAM! I'll be printing money!"
OK, so it didn't work out so well, and the industry is headed for a shake-out, but there are some folks who are a) making a difference in their communities and b) reaping the rewards from the exposure they get from making a difference (novel concept, eh?).
Over the next few days we'll give a shout out to Rubio's, Dakota Blue, Grand Traverse, Six Feet Under, Boudin, and Applebee's.
It's what I've been sayin' for years (to anyone who would listen, really): when you care about the things that your community cares about, they'll care about you. Being a good neighbor is good business.
But bigger and better were all the rage. "I'll just advertise and then BAM! I'll be printing money!"
OK, so it didn't work out so well, and the industry is headed for a shake-out, but there are some folks who are a) making a difference in their communities and b) reaping the rewards from the exposure they get from making a difference (novel concept, eh?).
Over the next few days we'll give a shout out to Rubio's, Dakota Blue, Grand Traverse, Six Feet Under, Boudin, and Applebee's.
It's what I've been sayin' for years (to anyone who would listen, really): when you care about the things that your community cares about, they'll care about you. Being a good neighbor is good business.
Thursday
Frequent Flyer to Frequent Diner
Producing a web site for a company, any company, highlights all of that company's process challenges and business opportunities in a single spot. Sure, you've got a web form for customers to fill out, but who within your company gets the information? How do they process the information? What phone number do we use for this promotion?
I've been working with Delta on their web site preparing for the merger with Northwest. If there is one thing that stands out in terms of their marketing ability it's this: everyone there understands the importance of measuring, monitoring, and making incremental improvement toward gaining share of wallet and more profitable sales.
In other words, they focus on their existing customers to get them more often and more profitably. Frequent Flyer miles are an important tool for them in this regard.
Email: Get double miles IF YOU CHECK-IN ONLINE.
Web Site: GIVE US YOUR CONTACT INFORMATION AND SIGN UP and we'll give you 500 miles.
Direct Mail: We'll give you 1.5 times your miles IF YOU BOOK IN BUSINESS ELITE.
In every case, we'll give you this if you do this for us.
For your restaurant, increased trial of menu and services leads to frequency of visit:
- FREE dessert with any seafood entree (because maybe seafood is more profitable for you, or maybe you just need to move it)
- FREE lunch with any catering order (the secretary/meeting planner/pharm rep gets something personal for ordering for others)
- Unlimited fries between 4pm and 6pm
- $1 breakfast sandwiches BEFORE 8am
It's important to note that NO ONE at this multi-billion dollar company with some of the brightest minds in marketing is complaining that they'll diminish their brand by "incentivizing" customers with Flyer Miles. No one. Why? Because they're trading value for value and modifying behavior. The brand isn't being diminished and neither is yours by incentivizing catering or different dayparts.
I've been working with Delta on their web site preparing for the merger with Northwest. If there is one thing that stands out in terms of their marketing ability it's this: everyone there understands the importance of measuring, monitoring, and making incremental improvement toward gaining share of wallet and more profitable sales.
In other words, they focus on their existing customers to get them more often and more profitably. Frequent Flyer miles are an important tool for them in this regard.
Email: Get double miles IF YOU CHECK-IN ONLINE.
Web Site: GIVE US YOUR CONTACT INFORMATION AND SIGN UP and we'll give you 500 miles.
Direct Mail: We'll give you 1.5 times your miles IF YOU BOOK IN BUSINESS ELITE.
In every case, we'll give you this if you do this for us.
For your restaurant, increased trial of menu and services leads to frequency of visit:
- FREE dessert with any seafood entree (because maybe seafood is more profitable for you, or maybe you just need to move it)
- FREE lunch with any catering order (the secretary/meeting planner/pharm rep gets something personal for ordering for others)
- Unlimited fries between 4pm and 6pm
- $1 breakfast sandwiches BEFORE 8am
It's important to note that NO ONE at this multi-billion dollar company with some of the brightest minds in marketing is complaining that they'll diminish their brand by "incentivizing" customers with Flyer Miles. No one. Why? Because they're trading value for value and modifying behavior. The brand isn't being diminished and neither is yours by incentivizing catering or different dayparts.
Wednesday
Restaurants Take Note...
Delta Air Lines, one of the world's largest, has an interesting philosophy. Instead of trying to gain new customers, in this economy where leisure travel is a luxury and business travel is a hard fought battle-ground, they work on frequency and ticket average.
I'm really impressed with Delta and their marketing strategy: modify consumer behavior to a) increase share of wallet and b) move to more profitable products and services.
If they don't have all of a business traveler's bookings, they incentivize them some more (double frequent flyer miles anyone?). If customers are using travel agents or an 800 number, Delta incentivizes them to book and check-in through more preferred channels: online and through more profitable kiosks.
As it turns out, profitability isn't the most important thing for Delta right now (it's important for everyone, but bear with me). Instead, they're instilling new habits. Visit our site for the lowest fares. Check-in online. Look to us for car and hotel offers. Make Delta your one-stop shop.
At the end of this down turn, expect Delta to have a strong and more profitable customer base than it did going in.
Compare that to restaurants. There are a lot of folks right now, and some of them are smart people (not all of them, but at least some of them), saying that building the customer base is the most important thing! It's the only way to survive!
More customers is a way to survive. The problem is, people aren't trying new things right now. Sure, the younger demographic with roommates for whom dining is an adventure are still trying new things and haven't stopped dining out a whole lot.
Families aren't though. They've cut WAY back. When you cut back, you don't try new places - too much risk. Frequency of visit is cut in half and, therefore, customer counts drop like a stone. This isn't lack of customer base, folks. It's lack of frequency.
Make hay while the sun is shining. Gain customers when the economy is rosy. It costs less money to increase customer counts through frequency of visit than through new trial generation. This is more true in a climate like this than at other times.
Build customer frequency, build customer loyalty. Your margins will go down, but your customer counts will go up. In the end, you'll have a stronger base for it. In the meantime, your bank account will be healthier for it.
You can't take percentages to the bank.
I'm really impressed with Delta and their marketing strategy: modify consumer behavior to a) increase share of wallet and b) move to more profitable products and services.
If they don't have all of a business traveler's bookings, they incentivize them some more (double frequent flyer miles anyone?). If customers are using travel agents or an 800 number, Delta incentivizes them to book and check-in through more preferred channels: online and through more profitable kiosks.
As it turns out, profitability isn't the most important thing for Delta right now (it's important for everyone, but bear with me). Instead, they're instilling new habits. Visit our site for the lowest fares. Check-in online. Look to us for car and hotel offers. Make Delta your one-stop shop.
At the end of this down turn, expect Delta to have a strong and more profitable customer base than it did going in.
Compare that to restaurants. There are a lot of folks right now, and some of them are smart people (not all of them, but at least some of them), saying that building the customer base is the most important thing! It's the only way to survive!
More customers is a way to survive. The problem is, people aren't trying new things right now. Sure, the younger demographic with roommates for whom dining is an adventure are still trying new things and haven't stopped dining out a whole lot.
Families aren't though. They've cut WAY back. When you cut back, you don't try new places - too much risk. Frequency of visit is cut in half and, therefore, customer counts drop like a stone. This isn't lack of customer base, folks. It's lack of frequency.
Make hay while the sun is shining. Gain customers when the economy is rosy. It costs less money to increase customer counts through frequency of visit than through new trial generation. This is more true in a climate like this than at other times.
Build customer frequency, build customer loyalty. Your margins will go down, but your customer counts will go up. In the end, you'll have a stronger base for it. In the meantime, your bank account will be healthier for it.
You can't take percentages to the bank.
Monday
Shaking Hands and...um...delivering babies
CIMA is a local OB/GYN that serves the immigrant population in North Atlanta. They have five clinics and reach out to their communities, most of whom do not speak much English.
Their clientele ranges from poor and scared to middle class and planned. They serve first time moms and those with two or three children.
Maria Francis is an RN who is also in charge of marketing. Less than 10 years ago, she says, CIMA was delivering fewer than 13 babies per month. Two years ago, that number was up to 150 babies per month. So how did they build the business, from a single clinic with 13 babies to a string of 5 clinics with 150 babies per month each?
"We went out into the neighborhood and talked to people," Maria tells me. "We held 'well-baby' clinics, we joined other healthcare companies to provide free tests, we met with local church leaders and elders to build trust." Maria tells me all of this matter of factly, as thought there were no other way to do it. "We became part of the communities we served."
Bolstered by success, the managing physicians decided that doing health fairs and meeting with mothers in churches was productive enough. They hired a marketing director, gave him a budget of $120k, and told him to get the word out.
The new campaign? Full page ads where they used to do classifieds. No more yellow pages, no more health fairs. TV and Radio replaced community meetings.
The result? Eight months into the campaign the budget is gone and new customers per month have dropped from 150 to around 95. More than a 33% drop off with three times the budget.
Instead of a cost of $20 per new customer gained with Maria and her crew building trust, the group now spends $100 per new customer gained. And they don't gain as many.
When you care about the things the community cares about, they care about what you care about. Build trust. Shake some hands.
Their clientele ranges from poor and scared to middle class and planned. They serve first time moms and those with two or three children.
Maria Francis is an RN who is also in charge of marketing. Less than 10 years ago, she says, CIMA was delivering fewer than 13 babies per month. Two years ago, that number was up to 150 babies per month. So how did they build the business, from a single clinic with 13 babies to a string of 5 clinics with 150 babies per month each?
"We went out into the neighborhood and talked to people," Maria tells me. "We held 'well-baby' clinics, we joined other healthcare companies to provide free tests, we met with local church leaders and elders to build trust." Maria tells me all of this matter of factly, as thought there were no other way to do it. "We became part of the communities we served."
Bolstered by success, the managing physicians decided that doing health fairs and meeting with mothers in churches was productive enough. They hired a marketing director, gave him a budget of $120k, and told him to get the word out.
The new campaign? Full page ads where they used to do classifieds. No more yellow pages, no more health fairs. TV and Radio replaced community meetings.
The result? Eight months into the campaign the budget is gone and new customers per month have dropped from 150 to around 95. More than a 33% drop off with three times the budget.
Instead of a cost of $20 per new customer gained with Maria and her crew building trust, the group now spends $100 per new customer gained. And they don't gain as many.
When you care about the things the community cares about, they care about what you care about. Build trust. Shake some hands.
Saturday
Nothing Fishy Here...
The Georgia Aquarium announced today that, though they pull from a trade radius that spans several states, their true objective for the coming years is...
Frequency of Visit. You'd think that a significant percentage of people have never been to the aquarium, and that a campaign to "get more customers" would be the thing to do. But bucking conventional wisdom, and actually understanding they dynamics of their business, the new CEO made the right move. Get repeat visitors.
The thinking is pretty simple: if you live nearby, and you enjoy your visit, you're likely to tell friends. You're likely to bring friends and family when they come to visit. You're more likely to come for just a few hours (with a season pass, instead of dedicating a day to it all).
That may lower the check average, but it's a relationship the aquarium is seeking. If they play their cards right, they're on track to get one.
Frequency of Visit. You'd think that a significant percentage of people have never been to the aquarium, and that a campaign to "get more customers" would be the thing to do. But bucking conventional wisdom, and actually understanding they dynamics of their business, the new CEO made the right move. Get repeat visitors.
The thinking is pretty simple: if you live nearby, and you enjoy your visit, you're likely to tell friends. You're likely to bring friends and family when they come to visit. You're more likely to come for just a few hours (with a season pass, instead of dedicating a day to it all).
That may lower the check average, but it's a relationship the aquarium is seeking. If they play their cards right, they're on track to get one.
I'm Back!
Whew! Been gone for a while, but have a whole lot of things to post. What I'm noticing about recent topics is that there's an interesting commonality to a lot of notable marketing these days: Frequency.
The GA Aquarium. Delta Airlines. Chick-fil-A. All have frequency in their sights - but not so much new customers.
Another interesting parallel: shaking hands and kissing babies. Again to the big boys: Delta, Home Depot; along with some smaller folks. Getting to know the people in their neighborhood and driving traffic (usually frequency, but some new trial).
All this and more over the next few days, but right now it's off to the village for happy hour. Haven't been in a while.
The GA Aquarium. Delta Airlines. Chick-fil-A. All have frequency in their sights - but not so much new customers.
Another interesting parallel: shaking hands and kissing babies. Again to the big boys: Delta, Home Depot; along with some smaller folks. Getting to know the people in their neighborhood and driving traffic (usually frequency, but some new trial).
All this and more over the next few days, but right now it's off to the village for happy hour. Haven't been in a while.
Wednesday
Restaurant Marketing - Celebrity Endorsements
Michael Phelps says he'd love to endorse a fast food company. But it got me to thinking about why companies solicit celebrity endorsements at all. Obviously it's because they want to show that they identify with their target audience - an endorsement says "they care about what I care about, and if you like me you'll care about them."
OK, not exactly like that, but pretty close.
So why can't local restaurants do this same thing, only with people who are not as well known? A HS football coach serves as a food runner for a fundraising night brings in around 100 players and their families. Plus, you get the benefit of showing you support what they support, so they should support you. How is this any different than getting a local DJ to say nice things about your food?
What about a local pastor handing out samples, or a local HS band playing out front for recognition of an award? The Chamber president serving as guest bartender for charity?
Being the Mayor of your village isn't about how pretty your ads are, it's about how well you know your community. Michael Phelps doesn't know diddly about Brunswick, GA or Ukiah, CA - but if that's where your restaurant is, you do.
OK, not exactly like that, but pretty close.
So why can't local restaurants do this same thing, only with people who are not as well known? A HS football coach serves as a food runner for a fundraising night brings in around 100 players and their families. Plus, you get the benefit of showing you support what they support, so they should support you. How is this any different than getting a local DJ to say nice things about your food?
What about a local pastor handing out samples, or a local HS band playing out front for recognition of an award? The Chamber president serving as guest bartender for charity?
Being the Mayor of your village isn't about how pretty your ads are, it's about how well you know your community. Michael Phelps doesn't know diddly about Brunswick, GA or Ukiah, CA - but if that's where your restaurant is, you do.
Tuesday
Go, Speed Racer!
I was watching Speed Racer with my little boy (the original series, not the movie) and one of the episodes made me chuckle.
Speed's dad opened an auto repair store and business was slow. Speed came in with this advice: "Why don't you give away the first repair for free? Then that person will tell of his friends how great you are, and what a good job you do. Then you'll have so much business you won't know what to do."
His dad took him up on the advice and soon had so much Model T business he couldn't handle it all. Got me to thinking about a couple of things:
- Doing something nice for someone usually creates a stronger relationship with customers than simply advertising.
- Especially for restaurant marketing, giving away a sample at an event (or better yet, giving someone a free sandwich/app/dessert so that they have to find your location) has always been a great way to show your product in action.
- This type of marketing was the norm back in the day. What makes you think it doesn't work now? Because we're more sophisticated and can reach 100,000 people in one message? Try that, let me know how it works for you.
- Word of mouth spreads faster in small groups (in this case, Model T owners - then do it for Corvette owners, then for Cadillac owners, and so on). Maybe the objective of your marketing should be to spread word of mouth, instead of create awareness.
- "But if I give it away, I'll have too much business and people will be mad." For the love of Pete, would you listen to yourself? First you don't have enough business, then you have too much. Be smart about it and this is never a concern. If you can't handle it, you should probably return to middle management.
- "But if I give it away, it will cheapen my product." Hogwash. Plain and simple. $1 off and BOGO w/purchase of a drink cheapen your product. Give someone free food, or support their event with discounted catering, and chances are they'll be grateful instead of taking you for granted.
All of this from a leisurely evening with my seven year old. Some things were just easier back in the day. You go, Speed Racer.
Speed's dad opened an auto repair store and business was slow. Speed came in with this advice: "Why don't you give away the first repair for free? Then that person will tell of his friends how great you are, and what a good job you do. Then you'll have so much business you won't know what to do."
His dad took him up on the advice and soon had so much Model T business he couldn't handle it all. Got me to thinking about a couple of things:
- Doing something nice for someone usually creates a stronger relationship with customers than simply advertising.
- Especially for restaurant marketing, giving away a sample at an event (or better yet, giving someone a free sandwich/app/dessert so that they have to find your location) has always been a great way to show your product in action.
- This type of marketing was the norm back in the day. What makes you think it doesn't work now? Because we're more sophisticated and can reach 100,000 people in one message? Try that, let me know how it works for you.
- Word of mouth spreads faster in small groups (in this case, Model T owners - then do it for Corvette owners, then for Cadillac owners, and so on). Maybe the objective of your marketing should be to spread word of mouth, instead of create awareness.
- "But if I give it away, I'll have too much business and people will be mad." For the love of Pete, would you listen to yourself? First you don't have enough business, then you have too much. Be smart about it and this is never a concern. If you can't handle it, you should probably return to middle management.
- "But if I give it away, it will cheapen my product." Hogwash. Plain and simple. $1 off and BOGO w/purchase of a drink cheapen your product. Give someone free food, or support their event with discounted catering, and chances are they'll be grateful instead of taking you for granted.
All of this from a leisurely evening with my seven year old. Some things were just easier back in the day. You go, Speed Racer.
Thursday
Who have you WOWed today?
When customers have been WOWed they are more likely to express their delight (read: word of mouth).
They're more likely to come back to your restaurant more often in the hopes of being WOWed again (hint: make the WOW special, it needs to be out of the ordinary, not expected).
They're likely to bring friends with them ("I know the owner. He's a great guy, you'll love him.").
And, over the course of a year or their lifetime (as a local resident or someone who works in the area), they're likely to spend more money with you because they are loyal to you and you have a higher share of wallet.
WOW one person per day, you have 365 WOWed customers per year. Sadly, most of us are too busy managing from the back door to the front door to notice. We're like prairie chickens, pecking in the dirt for scraps, instead of like eagles, flying overhead looking for opportunity.
So I ask you: Who have you WOWed today? Tell us at the restaurant marketing forum, The CommonMan Group.
They're more likely to come back to your restaurant more often in the hopes of being WOWed again (hint: make the WOW special, it needs to be out of the ordinary, not expected).
They're likely to bring friends with them ("I know the owner. He's a great guy, you'll love him.").
And, over the course of a year or their lifetime (as a local resident or someone who works in the area), they're likely to spend more money with you because they are loyal to you and you have a higher share of wallet.
WOW one person per day, you have 365 WOWed customers per year. Sadly, most of us are too busy managing from the back door to the front door to notice. We're like prairie chickens, pecking in the dirt for scraps, instead of like eagles, flying overhead looking for opportunity.
So I ask you: Who have you WOWed today? Tell us at the restaurant marketing forum, The CommonMan Group.
It's the Frequency, stupid
I've heard it so many times this year I almost started believing it myself. "I need more customers! How do I get more customers?!"
Sales people have jumped on that bandwagon. Many aren't telling you what you need, they're telling you what you want to hear. "We reach 50,000 people ready to buy. We'll get you more customers."
Here are the facts:
Not all of your customers have taken all of their four visits from you, but maybe you lost 1.5 of those (times 4,000 = 6,000 x $10 ticket = $60,000). Sound familiar? Is this about how much you're down?
Now your ticket average is probably higher now than last year. Why? Because the customers who remain are your loyal ones, and loyal customers spend more and bring friends. So if you normally have a $10 ticket average, but now it's up to $11 or $12, you're missing your not-so-loyal (but very profitable) $8-$9 customers.
You need to focus on getting them back, focus on getting customer counts up.
New customers will come, but they cost more to get and take longer. Former customers, not visiting because of the market, are easier to get back more often (email, bounce-backs, promotions, LTO). Solidify your base.
Sales people have jumped on that bandwagon. Many aren't telling you what you need, they're telling you what you want to hear. "We reach 50,000 people ready to buy. We'll get you more customers."
Here are the facts:
- The average American is dining out 4 fewer times per year
- Depending on the type of restaurant you have, you probably have around 4,000-6,000 unique customers
- 4 fewer visits per year x 4,000 customers = 16,000 fewer visits x $10 ticket average
Not all of your customers have taken all of their four visits from you, but maybe you lost 1.5 of those (times 4,000 = 6,000 x $10 ticket = $60,000). Sound familiar? Is this about how much you're down?
Now your ticket average is probably higher now than last year. Why? Because the customers who remain are your loyal ones, and loyal customers spend more and bring friends. So if you normally have a $10 ticket average, but now it's up to $11 or $12, you're missing your not-so-loyal (but very profitable) $8-$9 customers.
You need to focus on getting them back, focus on getting customer counts up.
New customers will come, but they cost more to get and take longer. Former customers, not visiting because of the market, are easier to get back more often (email, bounce-backs, promotions, LTO). Solidify your base.
Catering sales: Match your product to your audience
I recently reviewed some things from an ice cream concept. They are pushing cake sales and catering opportunities and have a program for going out to offices and other prospects.
The program is pretty good, but it misses a basic ingredient: if you want to sell higher ticket items (catering, for example) it's easier to sell to existing, loyal, and vocal customers than it is to someone in a sales pitch.
An example (we'll use a BBQ restaurant, but the principles are identical): what are the odds you sell a $300 catering to a group when no one has tried your product? What is the cost of that sale? You visit, you invite them in for lunch, you follow up, you leave materials. Then you have to wait until they have an occasion to buy and either hope they remember you or try to stay in front of them (more cost).
Contrast that to aggressively marketing catering to existing customers: send monthly emails that talk about catering; offer bounce-back offers for catering; draw fish bowl names for free "mini-catering" to their offices. Advantages: lower cost to a group you know has enjoyed your food.
Stick with selling higher ticket items to existing customers: it costs less and you'll sell more. So how do you get new customers to become (eventual) large ticket purchasers? Give them the small stuff and turn them into loyal customers. Remove all barriers to trial of your product and use Frequency tactics to keep them.
The program is pretty good, but it misses a basic ingredient: if you want to sell higher ticket items (catering, for example) it's easier to sell to existing, loyal, and vocal customers than it is to someone in a sales pitch.
An example (we'll use a BBQ restaurant, but the principles are identical): what are the odds you sell a $300 catering to a group when no one has tried your product? What is the cost of that sale? You visit, you invite them in for lunch, you follow up, you leave materials. Then you have to wait until they have an occasion to buy and either hope they remember you or try to stay in front of them (more cost).
Contrast that to aggressively marketing catering to existing customers: send monthly emails that talk about catering; offer bounce-back offers for catering; draw fish bowl names for free "mini-catering" to their offices. Advantages: lower cost to a group you know has enjoyed your food.
Stick with selling higher ticket items to existing customers: it costs less and you'll sell more. So how do you get new customers to become (eventual) large ticket purchasers? Give them the small stuff and turn them into loyal customers. Remove all barriers to trial of your product and use Frequency tactics to keep them.
Tuesday
Restaurant Market Share
Chipotle's doing it. Buffalo Wild Wing is doing it. So are Brueger's Bagels and BJ's Restaurants. They're planning to aggressively open new stores this year. This from the June 30, 2008 edition of Nation's Restaurant News.
And they're doing it even as consumer confidence slides. Even as people dine out less. Even though new store openings have outstripped demand every year since 2003 (there is one restaurant for every 662 people in the U.S., according to the NRA).
Why?! Two reasons: 1) because they can (good cash positions and limited debt) and 2) because it makes sense - grab market share now, cash in when the market rebounds.
Those who advertise now, who aggressively market, who open new units, have a great chance to grab market share, increase profits during the downturn, and come out far ahead of the pack after the recovery. So says nearly every study of every economic downturn since WW II. If you're waiting it out, you might be in trouble.
So...what to do? Here are some suggestions from those in the know:
- Cut costs, but don't skimp. Customers who perceive you're giving smaller portions without lowering prices, or charging for items that used to be free, will make you pay for it by giving your share to someone else.
- Invest in the culture. Nearly half of all lunch and dinner diners say that excellent atmosphere and customer service would help them forgive rising menu prices. Even if your prices aren't rising, you've gained goodwill (and loyalty).
- New menu items. Limited time offers and new menu items give existing customers more reasons to visit more often.
- New offerings and dayparts. Late night meals, breakfast, mid-afternoon specials, carry-out, delivery, catering - make it easy to purchase from you.
- Share, not profit. Profits matter, you'll never hear me say they don't. But you can't take percentages to the bank. Do what it takes to get butts in seats, but be careful not to addict your customers to discounts. Offer an exchange of value: apps for 4 when you buy them for 2; free dessert with purchase of salad and entree; free upsize before 11:30am (start lunch earlier).
Head count, butts in seats, are more important now than percentages. The more mouths you have in your restaurant (and the better you take care of them), the more mouths there are to spread the word.
And they're doing it even as consumer confidence slides. Even as people dine out less. Even though new store openings have outstripped demand every year since 2003 (there is one restaurant for every 662 people in the U.S., according to the NRA).
Why?! Two reasons: 1) because they can (good cash positions and limited debt) and 2) because it makes sense - grab market share now, cash in when the market rebounds.
Those who advertise now, who aggressively market, who open new units, have a great chance to grab market share, increase profits during the downturn, and come out far ahead of the pack after the recovery. So says nearly every study of every economic downturn since WW II. If you're waiting it out, you might be in trouble.
So...what to do? Here are some suggestions from those in the know:
- Cut costs, but don't skimp. Customers who perceive you're giving smaller portions without lowering prices, or charging for items that used to be free, will make you pay for it by giving your share to someone else.
- Invest in the culture. Nearly half of all lunch and dinner diners say that excellent atmosphere and customer service would help them forgive rising menu prices. Even if your prices aren't rising, you've gained goodwill (and loyalty).
- New menu items. Limited time offers and new menu items give existing customers more reasons to visit more often.
- New offerings and dayparts. Late night meals, breakfast, mid-afternoon specials, carry-out, delivery, catering - make it easy to purchase from you.
- Share, not profit. Profits matter, you'll never hear me say they don't. But you can't take percentages to the bank. Do what it takes to get butts in seats, but be careful not to addict your customers to discounts. Offer an exchange of value: apps for 4 when you buy them for 2; free dessert with purchase of salad and entree; free upsize before 11:30am (start lunch earlier).
Head count, butts in seats, are more important now than percentages. The more mouths you have in your restaurant (and the better you take care of them), the more mouths there are to spread the word.
Monday
Word of Mouth - Again
I've seen a lot of businesses, and some restaurants, talking about how much better life would be if only they had a facebook page, or how to get their web site more traffic.
Everyone who knows me knows I'm a big fan of electronic marketing. Blogs, web sites, disucssion boards, SEO, SEM - you name it.
But no so much for restaurants.
Sure, they're important. Sure, they can help convince someone who has already heard of you that your restaurant is better than another. But let's be clear: the vast majority of people eat at a restaurant for one of three reasons:
1) you have a great location and are convenient
2) people have heard great things about you (word of mouth)
3) customers have tried your food and liked it
They might check out your web site after they've heard of you, and before they try you, but the web is still secondary to word of mouth.
So if word of mouth is so important, why do we spend disproportionate time on the little things? Or money on advertising that doesn't generate word of mouth? When was the last time you and your friends got into a great philosophical debate over a newspaper ad? When was the last time you tried a new restaurant based on a newspaper, television, or radio ad (unless you saw/heard it at lunch time and happened to be sitting in front of that restaurant?
Americans see more than 2,000 messages per day. Advertising the old way is out. The web is measurable, and levels the playing field, but what percentage of new customers come because they first heard about you online?
Here's food for thought - the "hot new marketing medium" isn't electronic, broadcast, or print. It's on the sidelines of a soccer field, in the pediatrician's office, at the water cooler, and PTA meetings.
Folks, if your marketing doesn't promote word of mouth, and give those mouths the words to say, you're chasing fads. Nothing is more effective. And because most restaurants aren't any good at it, therein lies great opportunities for yours.
Everyone who knows me knows I'm a big fan of electronic marketing. Blogs, web sites, disucssion boards, SEO, SEM - you name it.
But no so much for restaurants.
Sure, they're important. Sure, they can help convince someone who has already heard of you that your restaurant is better than another. But let's be clear: the vast majority of people eat at a restaurant for one of three reasons:
1) you have a great location and are convenient
2) people have heard great things about you (word of mouth)
3) customers have tried your food and liked it
They might check out your web site after they've heard of you, and before they try you, but the web is still secondary to word of mouth.
So if word of mouth is so important, why do we spend disproportionate time on the little things? Or money on advertising that doesn't generate word of mouth? When was the last time you and your friends got into a great philosophical debate over a newspaper ad? When was the last time you tried a new restaurant based on a newspaper, television, or radio ad (unless you saw/heard it at lunch time and happened to be sitting in front of that restaurant?
Americans see more than 2,000 messages per day. Advertising the old way is out. The web is measurable, and levels the playing field, but what percentage of new customers come because they first heard about you online?
Here's food for thought - the "hot new marketing medium" isn't electronic, broadcast, or print. It's on the sidelines of a soccer field, in the pediatrician's office, at the water cooler, and PTA meetings.
Folks, if your marketing doesn't promote word of mouth, and give those mouths the words to say, you're chasing fads. Nothing is more effective. And because most restaurants aren't any good at it, therein lies great opportunities for yours.
Thursday
LSM for Blogs
I'm trying out some SEO (and LSM) techniques for blogs. Some work, some don't. But we keep trying new things (and also continue the things that work, no?).
Excuse this post for a day or so...
Technorati Profile
Excuse this post for a day or so...
Technorati Profile
Tuesday
Cause and Effect
The media tells us nearly every day that the restaurant industry's sky is falling. There is one restaurant for every 662 people in the U.S., and 662 unique customers isn't enough to sustain any one of them (unless they have outrageously low rents).
So, competition is stiffer. Apparently, according to Technomic, it's getting even stiffer. Retail meal solutions threaten to cut into market share even more by offering convenient, nutritious meals at an affordable family price-point (discuss restaurant competition at The CommonMan Group).
All this at a time when labor and food costs are rising and higher menu pricing is a looming reality. A menu and price elasticity study by Technomic for American Express provides some solid strategies for raising menu prices, how much, and at what dayparts.
(Discuss raising menu prices and customer satisfaction levels at The CommonMan Group.)
What is interesting to note about these two items - increased competition and rising costs - is a potential solution. When asked about the factors that would cause them to accept higher menu prices, consumers indicated atmosphere/ambience, cleanliness, and friendly staff would make it OK to spend the higher prices.
These are all things within the control of the operator, not external, "woe is me" factors. In all reality, this market is a shake out that will force restaurant owners to provide a dining experience, not just convenient food.
Friday's has implemented a new customer appreciation plan that has some pretty interesting elements to it. Take a look, and then tell us what you think and how you're dealing with the short- and long-term challenges facing the restaurant industry at The CommonMan Group.
So, competition is stiffer. Apparently, according to Technomic, it's getting even stiffer. Retail meal solutions threaten to cut into market share even more by offering convenient, nutritious meals at an affordable family price-point (discuss restaurant competition at The CommonMan Group).
All this at a time when labor and food costs are rising and higher menu pricing is a looming reality. A menu and price elasticity study by Technomic for American Express provides some solid strategies for raising menu prices, how much, and at what dayparts.
(Discuss raising menu prices and customer satisfaction levels at The CommonMan Group.)
What is interesting to note about these two items - increased competition and rising costs - is a potential solution. When asked about the factors that would cause them to accept higher menu prices, consumers indicated atmosphere/ambience, cleanliness, and friendly staff would make it OK to spend the higher prices.
These are all things within the control of the operator, not external, "woe is me" factors. In all reality, this market is a shake out that will force restaurant owners to provide a dining experience, not just convenient food.
Friday's has implemented a new customer appreciation plan that has some pretty interesting elements to it. Take a look, and then tell us what you think and how you're dealing with the short- and long-term challenges facing the restaurant industry at The CommonMan Group.
Thursday
Getting started with local store marketing
Every now and then I look back at posts to see how the conversation has evolved. I sometimes see that I get longer over time, writing articles instead of posts (I'm passionate, what can I say?).
I also notice that there's a wide mix of readers here. Some are old hats looking to tweak their game, others are just getting started.
So here are the basics of local store marketing for restaurants, just to get the ball rolling:
1. People choose restaurants based on word of mouth, not advertising
2. The other reason people choose restaurants is convenience - if your location is great, great. If not, you need to market.
3. Given the choice, consumers purchase from someone they know and like
4. Given the choice, people will support businesses that support their community
5. The lifetime value of a customer is more important than the one-time profit
6. Word of mouth is the best form of advertising, your marketing should encourage it
7. If your product is good, and the experience is memorable, people will talk about you and come back
8. You should remove all barriers to trial of your product
9. They're called guests for a reason, don't treat the transaction as a transaction
10. Community involvement is good business
That should get you started. Local store marketing is how it was done in the old days. Now that customers have to pass dozens of restaurants to get to your location (usually when they're hungry), owners are starting to realize that 90% of their business comes from the 3-5 mile radius surrounding their stores.
Successful local store marketers try to meet as many people within that radius as possible.
If you'd like more ideas, have ideas to share, or just want to discuss local store marketing with others in your shoes, visit The CommonMan Group: http://forum.commonmangroup.com. It's like an ad agency for the little guys.
I also notice that there's a wide mix of readers here. Some are old hats looking to tweak their game, others are just getting started.
So here are the basics of local store marketing for restaurants, just to get the ball rolling:
1. People choose restaurants based on word of mouth, not advertising
2. The other reason people choose restaurants is convenience - if your location is great, great. If not, you need to market.
3. Given the choice, consumers purchase from someone they know and like
4. Given the choice, people will support businesses that support their community
5. The lifetime value of a customer is more important than the one-time profit
6. Word of mouth is the best form of advertising, your marketing should encourage it
7. If your product is good, and the experience is memorable, people will talk about you and come back
8. You should remove all barriers to trial of your product
9. They're called guests for a reason, don't treat the transaction as a transaction
10. Community involvement is good business
That should get you started. Local store marketing is how it was done in the old days. Now that customers have to pass dozens of restaurants to get to your location (usually when they're hungry), owners are starting to realize that 90% of their business comes from the 3-5 mile radius surrounding their stores.
Successful local store marketers try to meet as many people within that radius as possible.
If you'd like more ideas, have ideas to share, or just want to discuss local store marketing with others in your shoes, visit The CommonMan Group: http://forum.commonmangroup.com. It's like an ad agency for the little guys.
Marketing for Franchised Brands
Franchisors are often at odds with franchisees about how to market their units. Franchisees, very often, want TV or radio spots, customizable for their area, whereas Franchisors know that those media aren't as effective as others - especially in an area where the brand has little or no awareness (an 'outlying' store).
Say you're a potential Franchisee in Columbus, OH, and you buy into a pizza concept with good store density in the southeast. Your marketing expenses will be higher because of lack of awareness and no economies of scale.
Most of us know this intuitively, but you'd be surprised at how far apart Franchisors are from Franchisees on this issue. Here, we look at why it happens.
From the time a prospect contacts a brand, the sales process begins. During the process the sales team trots out in-store POP, marketing manuals, and print collateral, all showcasing the beauty of the brand and the creativity of the team. It's their jobs. It's what they do.
Prospects see the objects of their desire - slick marketing material. They hear how the franchise consultants will help them market their units, how other Franchisees are a knowledge base to tap, and how they'll get their own 90-day marketing plan to hit the ground running.
So far, so good. The problems come in 12 months down the road, when reality sets in. The reality is that, while the materials look great, the store owner has to purchase the media to put them into the community. This isn't a perceived problem prior to opening - we'll buy a couple of radio spots, tell 100,000 people we're here, and then by more spots with our profits.
Chick-fil-A had nearly $800 million in sales before they ever ran their first TV ad. Have you ever seen a TV ad for Starbucks, one that wasn't for a packaged product that also sold in grocery stores? Not likely. Until recently Starbucks was all about billboards and store signage.
The result is a chasm: Franchisors know that local store marketing, getting Franchisees into the community shaking hands and kissing babies, is the best for all stores (that's how they built their first one, in most cases). Franchisees have been led to believe that corporate would be more involved, that materials and tools would do the work for them. Corporate's view is that they'll provide the hammer, but it's up to you to swing it.
Who's right? Usually, the Franchisor. It's their responsibility to provide tools, resources, and guidance. They've seen marketing done both ways - media vs. LSM - and they know when to apply each. Corporate's largest complaint is that owners sit behind the counter, waiting for sales instead of going after them. They bought themselves a $6 an hour job.
The problem is that expectations were not set properly. At the end of the day, success or failure of a location is dependent on the Franchisee. Many lawsuits, however, cite lack of marketing support as the reason for closure.
One solution to this issue is to clearly define expectations and roles at the beginning of the relationship. It would help if Franchise sales teams put more emphasis on the tools instead of looking to impress. It would also help if, during training, franchisees were exposed to the reality - "Here are your tools, and here is how to use them." An entirely new mindset needs to be established, and it can't be done once the store is opened.
Many Franchisees in the restaurant industry come from outside the industry. They come from big companies and only see the collateral, not the sales process. They see Outback and McD's advertising and have an unrealistic perception of its effectiveness. Advertising can be very effective, but it costs a lot of money and can be a treadmill to an under-capitalized unit.
Local store marketing builds customers and relationships and is more effective in both the short and long runs.
Say you're a potential Franchisee in Columbus, OH, and you buy into a pizza concept with good store density in the southeast. Your marketing expenses will be higher because of lack of awareness and no economies of scale.
Most of us know this intuitively, but you'd be surprised at how far apart Franchisors are from Franchisees on this issue. Here, we look at why it happens.
From the time a prospect contacts a brand, the sales process begins. During the process the sales team trots out in-store POP, marketing manuals, and print collateral, all showcasing the beauty of the brand and the creativity of the team. It's their jobs. It's what they do.
Prospects see the objects of their desire - slick marketing material. They hear how the franchise consultants will help them market their units, how other Franchisees are a knowledge base to tap, and how they'll get their own 90-day marketing plan to hit the ground running.
So far, so good. The problems come in 12 months down the road, when reality sets in. The reality is that, while the materials look great, the store owner has to purchase the media to put them into the community. This isn't a perceived problem prior to opening - we'll buy a couple of radio spots, tell 100,000 people we're here, and then by more spots with our profits.
Chick-fil-A had nearly $800 million in sales before they ever ran their first TV ad. Have you ever seen a TV ad for Starbucks, one that wasn't for a packaged product that also sold in grocery stores? Not likely. Until recently Starbucks was all about billboards and store signage.
The result is a chasm: Franchisors know that local store marketing, getting Franchisees into the community shaking hands and kissing babies, is the best for all stores (that's how they built their first one, in most cases). Franchisees have been led to believe that corporate would be more involved, that materials and tools would do the work for them. Corporate's view is that they'll provide the hammer, but it's up to you to swing it.
Who's right? Usually, the Franchisor. It's their responsibility to provide tools, resources, and guidance. They've seen marketing done both ways - media vs. LSM - and they know when to apply each. Corporate's largest complaint is that owners sit behind the counter, waiting for sales instead of going after them. They bought themselves a $6 an hour job.
The problem is that expectations were not set properly. At the end of the day, success or failure of a location is dependent on the Franchisee. Many lawsuits, however, cite lack of marketing support as the reason for closure.
One solution to this issue is to clearly define expectations and roles at the beginning of the relationship. It would help if Franchise sales teams put more emphasis on the tools instead of looking to impress. It would also help if, during training, franchisees were exposed to the reality - "Here are your tools, and here is how to use them." An entirely new mindset needs to be established, and it can't be done once the store is opened.
Many Franchisees in the restaurant industry come from outside the industry. They come from big companies and only see the collateral, not the sales process. They see Outback and McD's advertising and have an unrealistic perception of its effectiveness. Advertising can be very effective, but it costs a lot of money and can be a treadmill to an under-capitalized unit.
Local store marketing builds customers and relationships and is more effective in both the short and long runs.
Tuesday
Restaurant Marketing Ideas for Summer
Summertime is a great time for some restaurants (seasonal businesses, good locations), but can be frustrating for those who count on schools and families for their marketing ideas. Where do you market when kids are out of school? How do you find families who are still in town? How do you get in with other seasonal businesses to cross-promote?
Families are still around, but they've changed their schedules and routines. Plus, they now get information in different ways. Instead of learning of you through a school newsletter, they now get emails from parent's groups, sports leagues, and summer camps.
Some marketing ideas can be found at this link (and we hope you'll add your own), but here we discuss the theory behind it.
The activities families are involved in are like media. Instead of a DJ, a school has a principal. Instead of a TV star pushing your product, you have church leaders who give you positive word of mouth. Local store marketing is like PR, but in smaller, more local groups.
Families change their "media" throughout the year, and summer is the most obvious. Instead of hearing of new things through the PTA, they now hear about them poolside, or at day-camp drop off. Many businesses need to change their marketing tactics to adapt.
Know, too, that buying decisions change during the summer. During the school year, when kids are involved in organized activities, getting take-out before soccer practice is a balance between convenience and "a lighter meal". Kids are still active in the summer, but often with play dates and camps instead of organized activities. Now the buying decision might be more like a family picnic, or include friends of children. How much food can I get for the dollars spent might be a better message in the summer.
For some, summer means a quiet period ("everyone's on vacation"). For others, it's a chance to find new audiences (been to the library lately?) or promote other menu items. For the smart local store marketer, it's a chance to get reacquainted with your community.
Families are still around, but they've changed their schedules and routines. Plus, they now get information in different ways. Instead of learning of you through a school newsletter, they now get emails from parent's groups, sports leagues, and summer camps.
Some marketing ideas can be found at this link (and we hope you'll add your own), but here we discuss the theory behind it.
The activities families are involved in are like media. Instead of a DJ, a school has a principal. Instead of a TV star pushing your product, you have church leaders who give you positive word of mouth. Local store marketing is like PR, but in smaller, more local groups.
Families change their "media" throughout the year, and summer is the most obvious. Instead of hearing of new things through the PTA, they now hear about them poolside, or at day-camp drop off. Many businesses need to change their marketing tactics to adapt.
Know, too, that buying decisions change during the summer. During the school year, when kids are involved in organized activities, getting take-out before soccer practice is a balance between convenience and "a lighter meal". Kids are still active in the summer, but often with play dates and camps instead of organized activities. Now the buying decision might be more like a family picnic, or include friends of children. How much food can I get for the dollars spent might be a better message in the summer.
For some, summer means a quiet period ("everyone's on vacation"). For others, it's a chance to find new audiences (been to the library lately?) or promote other menu items. For the smart local store marketer, it's a chance to get reacquainted with your community.
Monday
Introducing The CommonMan Group
[Note: post was edited to give a little more info: We're trying an online version of a marketing roundtable. Visit this site to get ideas and ask questions. If you know answers to others' questions, put in your two cents worth as well.]
forum.commonmangroup.com
Looking for marketing ideas? Like to share some of your own? Have a specific marketing challenge you need to overcome. Visit the marketing discussion boards at The CommonMan Group.
It's just getting started and needs your input. I'll be there too, but this is about community, not me telling you what to do.
Some examples of topics:
Mrs. Winner's summer gas promotion
An example of how NOT to do LSM
How to make customers feel like guests
And more. Don't see a topic that tickles your fancy? Start your own. Just register and login. You can ask questions and give your own two cents' worth to others.
forum.commonmangroup.com
Looking for marketing ideas? Like to share some of your own? Have a specific marketing challenge you need to overcome. Visit the marketing discussion boards at The CommonMan Group.
It's just getting started and needs your input. I'll be there too, but this is about community, not me telling you what to do.
Some examples of topics:
Mrs. Winner's summer gas promotion
An example of how NOT to do LSM
How to make customers feel like guests
And more. Don't see a topic that tickles your fancy? Start your own. Just register and login. You can ask questions and give your own two cents' worth to others.
Local Restaurant Sales
I'd like to expand on the poll to the right by asking for a little more information:
Are your sales up or down from this time last year? I'd also be interested to know if you're a fast-casual, fine dining, independent, chain, etc. Tell me a little more about your business.
From cursory research, I'd say that sales are relatively flat in some fast-casual segments - their customer counts down, but ticket averages are higher. Info like that can be the basis for some summer promotions (frequency of visit, higher ticket specials).
For more discussion on the poll, visit the local store marketing discussion group to give (and get) ideas for managing summer sales.
Are your sales up or down from this time last year? I'd also be interested to know if you're a fast-casual, fine dining, independent, chain, etc. Tell me a little more about your business.
From cursory research, I'd say that sales are relatively flat in some fast-casual segments - their customer counts down, but ticket averages are higher. Info like that can be the basis for some summer promotions (frequency of visit, higher ticket specials).
For more discussion on the poll, visit the local store marketing discussion group to give (and get) ideas for managing summer sales.
Does local store marketing work?
Yep. It's always worked. The author of this article asks a great question: If it works so well, why doesn't every store and restaurant use its tactics?
And then she answers the question: Because it requires a commitment.
You can read the article here.
And you can give us your thoughts on it here.
And then she answers the question: Because it requires a commitment.
You can read the article here.
And you can give us your thoughts on it here.
Speaking of marketing...
Holding a workshop for a single franchise or a single type of restaurant (coffeehouses, for example) are great, because we can get into the specific issues of each brand or type. I've done many of these marketing workshops and the ideas generated are usually really creative and inspiring.
However, I find that the more brands represented the better. The reason is that owners/managers stop focusing on their individual perceptions ("That might work for you, but people in MY are are different.") and start coming up with ideas for other people. It's amazing how we open our minds when we're working with someone else's budget and time.
To that end, I've created a forum where many people, from many brands, in many different types of restaurants, can come together to share ideas. Ask questions, make statements, help others, just participate. The forum is located at forum.commonmangroup.com and is just getting started - you can be a charter member.
You can start your own threads or just comment on the ones there. Either way, join us to become part of the community.
However, I find that the more brands represented the better. The reason is that owners/managers stop focusing on their individual perceptions ("That might work for you, but people in MY are are different.") and start coming up with ideas for other people. It's amazing how we open our minds when we're working with someone else's budget and time.
To that end, I've created a forum where many people, from many brands, in many different types of restaurants, can come together to share ideas. Ask questions, make statements, help others, just participate. The forum is located at forum.commonmangroup.com and is just getting started - you can be a charter member.
You can start your own threads or just comment on the ones there. Either way, join us to become part of the community.
Sunday
Where do you want to be in a year?
Even if you don't believe the sky is falling (I don't), you probably recognize that it's a tight market for restaurants. The NRA put out stats showing that the Restaurant Performance Indexhas hit an all-time low, the University of Michigan's consumer survey indicates consumers are less confident about the future, and most media outlets are predicting doom and gloom.
Regardless of the reality (this economy compared to other downturns in the past), consumer perception is a powerful force that is affecting your business. Many people, myself included, see this economy as a chance to grow your business, to gain market share and position yourself for the years to come.
I wanted to share, then, a blog post that focuses on the positive and offers some good advice as to how to control your own perceptions, project a feeling of prosperity, and attract more customers. It's called Is Your Mindset Holding You Back? and it offers some thoughtful questions as to how all of perceive our current situation, and what to do about it.
Regardless of the reality (this economy compared to other downturns in the past), consumer perception is a powerful force that is affecting your business. Many people, myself included, see this economy as a chance to grow your business, to gain market share and position yourself for the years to come.
I wanted to share, then, a blog post that focuses on the positive and offers some good advice as to how to control your own perceptions, project a feeling of prosperity, and attract more customers. It's called Is Your Mindset Holding You Back? and it offers some thoughtful questions as to how all of perceive our current situation, and what to do about it.
Friday
Bad LSM
When people ask for local store marketing advice for their restaurants, chances are what they really mean is: "Do you have any new ideas?" For the most part, local store marketers are confident in their tactics and if something isn't working then they don't need to modify their tactics, they need new ones.
Those who know me know that I usually examine what is currently being done before I'll give any new ideas. The reason is because, for the most part, the value in LSM is being face to face. Nearly any tactic will work PROVIDED you have the right objective and give the right offer.
The manager of an English pub asked me for some new ideas. He was already doing LSM, but he needed new ideas to get people through the door. The restaurant was (past tense) at the base of one of the largest office buildings in the Southeast.
I asked what he was currently doing and he said he had been taking food over to the buildings, trying to get on the good side of the gatekeepers so he could get more business. The problem? The "food" was cupcakes, items that aren't even on his menu.
So instead of making up some appetizers in his kitchen, he was spending time going to a bakery and spending money on something that, even if they were to-die-for cupcakes, the recipients couldn't get at his location. Well, at least his food costs were still in line. The business closed one week after our initial conversation. By the time he asked for help, the restaurant was already close to closing.
Good Local Store Marketing for office buildings:
- Going to the buildings is a good idea, so he didn't need a better one
- Take food that you serve - you're providing an example of your food, if it's good people will visit
- Don't just "drop food by", find an audience before you leave (your fishbowl is a good place to start)
- By-pass the receptionist / security guard: by saying "you've won free catering for 10" you get invited past the gatekeepers
- Bring them to you: pull winners from your fishbowl a few times per week; those people don't eat lunch alone and you'll expose new people to your menu
- DO NOT offer standing discounts (10% to all employees, just show your badge); you can't ever back off of these discounts and people will become addicted to the discount
- INSTEAD, offer a value-add to employees: 'FREE drink with purchase' one month, 'FREE cookie' the next; 'FREE upsize' the next; keep them coming back by making them special, NOT by discounting
- Use your newfound traffic to promote party size, happy hour, or dinner specials (only one at a time, please)
Good luck, and let us know how things worked out for you: Gossamer Marketing
Those who know me know that I usually examine what is currently being done before I'll give any new ideas. The reason is because, for the most part, the value in LSM is being face to face. Nearly any tactic will work PROVIDED you have the right objective and give the right offer.
The manager of an English pub asked me for some new ideas. He was already doing LSM, but he needed new ideas to get people through the door. The restaurant was (past tense) at the base of one of the largest office buildings in the Southeast.
I asked what he was currently doing and he said he had been taking food over to the buildings, trying to get on the good side of the gatekeepers so he could get more business. The problem? The "food" was cupcakes, items that aren't even on his menu.
So instead of making up some appetizers in his kitchen, he was spending time going to a bakery and spending money on something that, even if they were to-die-for cupcakes, the recipients couldn't get at his location. Well, at least his food costs were still in line. The business closed one week after our initial conversation. By the time he asked for help, the restaurant was already close to closing.
Good Local Store Marketing for office buildings:
- Going to the buildings is a good idea, so he didn't need a better one
- Take food that you serve - you're providing an example of your food, if it's good people will visit
- Don't just "drop food by", find an audience before you leave (your fishbowl is a good place to start)
- By-pass the receptionist / security guard: by saying "you've won free catering for 10" you get invited past the gatekeepers
- Bring them to you: pull winners from your fishbowl a few times per week; those people don't eat lunch alone and you'll expose new people to your menu
- DO NOT offer standing discounts (10% to all employees, just show your badge); you can't ever back off of these discounts and people will become addicted to the discount
- INSTEAD, offer a value-add to employees: 'FREE drink with purchase' one month, 'FREE cookie' the next; 'FREE upsize' the next; keep them coming back by making them special, NOT by discounting
- Use your newfound traffic to promote party size, happy hour, or dinner specials (only one at a time, please)
Good luck, and let us know how things worked out for you: Gossamer Marketing
Wednesday
Party Size - Lunch
It's more true this time of year than at any other (at least for restaurants): If you want effective marketing for your restaurant, you need to know both your audience and your objective.
First, objective: Get more people through the doors. You always want more customers, but your big issue now is likely frequency of visit (everyone is on vacation). It's a double whammy: your regulars have changed to their summer schedule and pockets of new customers are less predictable.
The one constant you have is current customers, those walking through your door.
Second, know your audience. Office workers tend to take longer lunches in the summer. Whether it's because their office is slow, or because the weather is nice, or because they're running errands, they're more willing to eschew the cafeteria and venture out. When they venture outside their office building, it's more of an event ("I invited Dan to join us").
Your goal, then, should be to encourage party sizes. Consider your offer carefully. Is it worth it to give something away if it's the difference between a group of 4 choosing you over the place next door? Is it worth incentivizing the "ring leader" who will influence three of his friends to join him at his place of choosing? 'Yes' to both questions.
- Free 10 piece wings with combo meal purchase (11am - 2pm only); the rationale is that one person can't eat that much and will bring friends, you give 10 wings to get three or more combo sales
- Free dessert to parties of 4 or more
- Have a patio? Use your fishbowl to find a "winner" of a free app (after 3:00pm). When the patio has activity your visibility is increased. The timing of the offer, on a nice day, will cause some to cut out of work early
- Use email to offer Free dessert (or side or drink) to the first 25 (or 50) people of the day; the email will get forwarded within the office, even if the customers don't come as a single party the effect will be the same
First, objective: Get more people through the doors. You always want more customers, but your big issue now is likely frequency of visit (everyone is on vacation). It's a double whammy: your regulars have changed to their summer schedule and pockets of new customers are less predictable.
The one constant you have is current customers, those walking through your door.
Second, know your audience. Office workers tend to take longer lunches in the summer. Whether it's because their office is slow, or because the weather is nice, or because they're running errands, they're more willing to eschew the cafeteria and venture out. When they venture outside their office building, it's more of an event ("I invited Dan to join us").
Your goal, then, should be to encourage party sizes. Consider your offer carefully. Is it worth it to give something away if it's the difference between a group of 4 choosing you over the place next door? Is it worth incentivizing the "ring leader" who will influence three of his friends to join him at his place of choosing? 'Yes' to both questions.
- Free 10 piece wings with combo meal purchase (11am - 2pm only); the rationale is that one person can't eat that much and will bring friends, you give 10 wings to get three or more combo sales
- Free dessert to parties of 4 or more
- Have a patio? Use your fishbowl to find a "winner" of a free app (after 3:00pm). When the patio has activity your visibility is increased. The timing of the offer, on a nice day, will cause some to cut out of work early
- Use email to offer Free dessert (or side or drink) to the first 25 (or 50) people of the day; the email will get forwarded within the office, even if the customers don't come as a single party the effect will be the same
Tuesday
Grab Market Share
The Bad News
According to the National Restaurant Association, there is one restaurant for every 662 people in the U.S. Based on the following, there will likely be a few to fall off this year:
- surcharges due to increased fuel costs
- proteins increasing due to feed costs
- dairy prices increasing due to feed
- average American families eating out less due to increased gas, tighter budgets
- don't even want to think about minimum wage increasing
Technomic forecasts a 2.1% increase in restaurant sales nationwide this year, a figure that also assumes a 4% increase in menu prices. Guest traffic is down, mainly due to frequency of visit (207 outside meals per year vs. 211 two years ago).
The Good News
The above data (it's data only, not information) assumes that the pain will be spread equally, that everyone is in the same boat. Not true.
A scenario: a family of four eats out an average of four times per month. They rotate between four restaurants that both the kids and the parents enjoy (or at least can tolerate). Their economic circumstances cause them to cut back to twice per month.
Which is more likely:
a) they continue the same rotation of restaurants, each getting a visit from them every other month (decreasing the restaurants' revenue by half); or
b) they eliminate the restaurants they merely tolerated, continuing to dine at the restaurants they truly enjoy (no effect on two of the restaurants)?
Most of us will consolidate our dollars, meaning two restaurants have no share of wallet and the other two are unaffected. It's human nature.
Clearly, customer service, perceived value, and overall experience are critical at this point in time.
But what of the restaurants that lose their customers? If they don't survive the downturn, where will their existing customers go?
Now is the time to grab market share. Total number of customers is more valuable now than overall profitability (I said profitability, not profits - read on).
Would you rather have 4,000 customers with a profit margin of 14%, or will you settle for 3,000 customers but cling to your 16% margins?
4,000 x $10/week x 25 weeks = 1,000,000 x .14 = $140,000 profit
3,000 x $10/week x 25 weeks = 750,000 x .16 = $120,000 profit
This is at a time when people are eating out less. Use the same figures in a better economy:
4,000 x $10/week x 35 weeks = 1,400,000 x .14 = $196,000 profit
3,000 x $10/week x 35 weeks = 1,050,000 x .16 = $168,000 profit
And if you can gather those customers, and that frequency, without purchasing media you'll save another 2%-3% toward your bottom line. The next Local Store Marketing Newsletter provides suggestions for doing just that.
According to the National Restaurant Association, there is one restaurant for every 662 people in the U.S. Based on the following, there will likely be a few to fall off this year:
- surcharges due to increased fuel costs
- proteins increasing due to feed costs
- dairy prices increasing due to feed
- average American families eating out less due to increased gas, tighter budgets
- don't even want to think about minimum wage increasing
Technomic forecasts a 2.1% increase in restaurant sales nationwide this year, a figure that also assumes a 4% increase in menu prices. Guest traffic is down, mainly due to frequency of visit (207 outside meals per year vs. 211 two years ago).
The Good News
The above data (it's data only, not information) assumes that the pain will be spread equally, that everyone is in the same boat. Not true.
A scenario: a family of four eats out an average of four times per month. They rotate between four restaurants that both the kids and the parents enjoy (or at least can tolerate). Their economic circumstances cause them to cut back to twice per month.
Which is more likely:
a) they continue the same rotation of restaurants, each getting a visit from them every other month (decreasing the restaurants' revenue by half); or
b) they eliminate the restaurants they merely tolerated, continuing to dine at the restaurants they truly enjoy (no effect on two of the restaurants)?
Most of us will consolidate our dollars, meaning two restaurants have no share of wallet and the other two are unaffected. It's human nature.
Clearly, customer service, perceived value, and overall experience are critical at this point in time.
But what of the restaurants that lose their customers? If they don't survive the downturn, where will their existing customers go?
Now is the time to grab market share. Total number of customers is more valuable now than overall profitability (I said profitability, not profits - read on).
Would you rather have 4,000 customers with a profit margin of 14%, or will you settle for 3,000 customers but cling to your 16% margins?
4,000 x $10/week x 25 weeks = 1,000,000 x .14 = $140,000 profit
3,000 x $10/week x 25 weeks = 750,000 x .16 = $120,000 profit
This is at a time when people are eating out less. Use the same figures in a better economy:
4,000 x $10/week x 35 weeks = 1,400,000 x .14 = $196,000 profit
3,000 x $10/week x 35 weeks = 1,050,000 x .16 = $168,000 profit
And if you can gather those customers, and that frequency, without purchasing media you'll save another 2%-3% toward your bottom line. The next Local Store Marketing Newsletter provides suggestions for doing just that.
Wednesday
Series: After Coups, Part 6 (FINAL CHAPTER)
So the Brand is You. You're the Mayor of Your Village. You've got Promotional Items and you're distributing them at Events in your area.
One final thing you can do to be well known, well liked, and on the tip of everyone's tongue is to take a page from Real Estate agents and become an information broker for the community. Everyone knows that if you want to know what's going on the neighborhood, RE agents have a leg up in knowledge.
This is a great tactic for a restaurant, coffeehouse, pub, or meeting place. Know what's happening. Read the papers, talk to community leaders, offer to help new merchants with City Hall and other issues. Share your vendors, lend a hand.
KNOW YOUR MARKET! If you know more than anyone else, you'll be the first person people come to. When this is the case, you'll know you've made it as a local store marketer. You WILL be the Mayor. You WILL be liked and respected, positive word of mouth will flow. And your sales will reflect that fact. (A side benefit is that if anyone does say anything bad about your business you'll be the first to know about it and can correct any issues.)
Become an information broker for your community - that's what being the Mayor is all about.
One final thing you can do to be well known, well liked, and on the tip of everyone's tongue is to take a page from Real Estate agents and become an information broker for the community. Everyone knows that if you want to know what's going on the neighborhood, RE agents have a leg up in knowledge.
This is a great tactic for a restaurant, coffeehouse, pub, or meeting place. Know what's happening. Read the papers, talk to community leaders, offer to help new merchants with City Hall and other issues. Share your vendors, lend a hand.
KNOW YOUR MARKET! If you know more than anyone else, you'll be the first person people come to. When this is the case, you'll know you've made it as a local store marketer. You WILL be the Mayor. You WILL be liked and respected, positive word of mouth will flow. And your sales will reflect that fact. (A side benefit is that if anyone does say anything bad about your business you'll be the first to know about it and can correct any issues.)
Become an information broker for your community - that's what being the Mayor is all about.
Tuesday
Series: After Coups, Part 5
Stay relevant, stay visible, by doing events marketing.
Sponsoring or attending events goes hand in hand with the other non-coupon elements of building your business. You get a chance to be the Mayor of Mayberry (shake hands, kiss babies), they give you a platform to distribute promotional items, and you can finely target your audience while supporting your community at the same time.
Events become your media strategy, your message presented face to face in an interactive manner, building relationships. They're the holy grail.
There are two different types of events, internal and external. Below are some ideas for making them great. Depending on whether you're QSR, fast-casual, or casual, you should schedule no less than three events per month, preferably closer to six or seven.
(Quick Note: I didn't include fine dining because, well, these ideas do not generally match up with the brands of fine dining. HOWEVER, you can definitely tailor events to a fine dining brand. The process and strategy are the same, the tactics and audiences are very different.)
Internal Event Ideas:
- Fundraising night for an elementary school, church, Boy/Girl Scout troop
- Car washes (if you have a free standing building)
- Talent showcase (get band members to perform out front one Saturday)
- Charity fundraisers: wine tastings and food pairings to theme nights
- Toys for Tots drop off
- Business association / networking group meetings (mornings, even if you aren't open for breakfast)
External Event Ideas:
- Sample on site
- Sell on site (won't make much, but good exposure)
- Sell / share profits with an organization (such as at a HS football game, split proceeds with boosters)
- Sponsor the event (signage and other presence)
- Crash the event (show up to a city-wide festival or parade with Frisbees, coupons, t-shirts, and hats)
- Participate (provide drinks for a 5k race)
- Support (provide breakfast for the Chamber meeting one month, for Real Estate agents the next)
Events can be spontaneous or take planning, be involved or off the cuff. In any case, they provide a face to face medium and a chance for you to shake hands and kiss babies. Choose your audiences well, plan your calendar in advance, and make this a strong part of your marketing plan - you'll see results quickly.
Sponsoring or attending events goes hand in hand with the other non-coupon elements of building your business. You get a chance to be the Mayor of Mayberry (shake hands, kiss babies), they give you a platform to distribute promotional items, and you can finely target your audience while supporting your community at the same time.
Events become your media strategy, your message presented face to face in an interactive manner, building relationships. They're the holy grail.
There are two different types of events, internal and external. Below are some ideas for making them great. Depending on whether you're QSR, fast-casual, or casual, you should schedule no less than three events per month, preferably closer to six or seven.
(Quick Note: I didn't include fine dining because, well, these ideas do not generally match up with the brands of fine dining. HOWEVER, you can definitely tailor events to a fine dining brand. The process and strategy are the same, the tactics and audiences are very different.)
Internal Event Ideas:
- Fundraising night for an elementary school, church, Boy/Girl Scout troop
- Car washes (if you have a free standing building)
- Talent showcase (get band members to perform out front one Saturday)
- Charity fundraisers: wine tastings and food pairings to theme nights
- Toys for Tots drop off
- Business association / networking group meetings (mornings, even if you aren't open for breakfast)
External Event Ideas:
- Sample on site
- Sell on site (won't make much, but good exposure)
- Sell / share profits with an organization (such as at a HS football game, split proceeds with boosters)
- Sponsor the event (signage and other presence)
- Crash the event (show up to a city-wide festival or parade with Frisbees, coupons, t-shirts, and hats)
- Participate (provide drinks for a 5k race)
- Support (provide breakfast for the Chamber meeting one month, for Real Estate agents the next)
Events can be spontaneous or take planning, be involved or off the cuff. In any case, they provide a face to face medium and a chance for you to shake hands and kiss babies. Choose your audiences well, plan your calendar in advance, and make this a strong part of your marketing plan - you'll see results quickly.
Monday
Series: After Coups, Part 4
Promotional products help extend your presence.
So far we've talked about Branding (what it really is) and being the Mayor of Mayberry (a marketing mindset that builds relationships). Now we move to a tactic that has more mass appeal: Promotional products.
Promotional products are anything with your logo on it. The more useful the item is to your target audience the more in-demand the items will be, and the more visible they will be to others. Take t-shirts, for example. If your target audience includes high school students, a cool t-shirt with your image on it will be worn again and again - a walking advertisement for your product. Hats too, but spend the money to purchase ones that the kids will wear (if you're out of touch with style, ask your employees to help select one).
Once you have your items, distribute them in-store or at local events. Now that you're cutting back on coupons, hand out promotional items along with your samples.
Some examples:
- stress balls
- step-counters
- t-shirts / hats
- water bottles (or bottled water)
- Frisbees
- kids tattoos
- coffee mugs
- can cozies
The more relevant the item is to both your target audience and your product, the more successful you will be.
So far we've talked about Branding (what it really is) and being the Mayor of Mayberry (a marketing mindset that builds relationships). Now we move to a tactic that has more mass appeal: Promotional products.
Promotional products are anything with your logo on it. The more useful the item is to your target audience the more in-demand the items will be, and the more visible they will be to others. Take t-shirts, for example. If your target audience includes high school students, a cool t-shirt with your image on it will be worn again and again - a walking advertisement for your product. Hats too, but spend the money to purchase ones that the kids will wear (if you're out of touch with style, ask your employees to help select one).
Once you have your items, distribute them in-store or at local events. Now that you're cutting back on coupons, hand out promotional items along with your samples.
Some examples:
- stress balls
- step-counters
- t-shirts / hats
- water bottles (or bottled water)
- Frisbees
- kids tattoos
- coffee mugs
- can cozies
The more relevant the item is to both your target audience and your product, the more successful you will be.
Series: After Coupons, Part 3
Be the Mayor of Mayberry. It's a commitment of time, but no marketing strategy works better than being everyone's friend.
You're told in school that you can't be everyone's friend. That's good advice for high school, it'll keep you from falling in with the wrong crowd and staying true to yourself.
But why can't a restaurant owner try to get everyone to like them? What's the downside? It's not a lack of brand recognition (you ARE the brand). And so what if the "friendships" are superficial? These are your guests, they don't expect you to remember their pets' names (bonus points if you do though).
Being the Mayor of the Village simply means that you care about your constituents, that you give back to the community in which you live and work.
It also means knowing the thought leaders in the neighborhood. PR is effective, and companies spend a lot of money on it, because thought leaders like radio personalities and newspaper reporters say nice things about their products. A savvy Mayor does the same thing, but they include additional thought leaders such as principals, ministers, charity leaders, youth leaders, athletic organizers, Chamber presidents, and others.
Being the Mayor was the only advertising local restaurants did for centuries. Being involved in the community was good business. Still is.
The strategy takes time, but there's no better way to build a loyal base. Thankfully, since you're food rich and cash poor, offering some free food gives you the perfect excuse to introduce yourself to those who will spread the word to their own constituents.
You're told in school that you can't be everyone's friend. That's good advice for high school, it'll keep you from falling in with the wrong crowd and staying true to yourself.
But why can't a restaurant owner try to get everyone to like them? What's the downside? It's not a lack of brand recognition (you ARE the brand). And so what if the "friendships" are superficial? These are your guests, they don't expect you to remember their pets' names (bonus points if you do though).
Being the Mayor of the Village simply means that you care about your constituents, that you give back to the community in which you live and work.
It also means knowing the thought leaders in the neighborhood. PR is effective, and companies spend a lot of money on it, because thought leaders like radio personalities and newspaper reporters say nice things about their products. A savvy Mayor does the same thing, but they include additional thought leaders such as principals, ministers, charity leaders, youth leaders, athletic organizers, Chamber presidents, and others.
Being the Mayor was the only advertising local restaurants did for centuries. Being involved in the community was good business. Still is.
The strategy takes time, but there's no better way to build a loyal base. Thankfully, since you're food rich and cash poor, offering some free food gives you the perfect excuse to introduce yourself to those who will spread the word to their own constituents.
Thursday
Series: After Coupons, Part 2
Branding. The term has been relied on very heavily by people who may, or may not, understand what it means or what it takes to do it effectively.
Branding is everything about your restaurant. Menu design, menu pricing, and menu content all indicate your brand to users. Staff uniforms, appearance, and professionalism contribute significantly.
However, most restaurants only focus on print materials or logos as their brand. That stuff is important, but by not realizing what the brand is, people waste money by spending cash on advertising, and skimping on research and hourly wages.
For independents and franchises alike (though most new franchisees disagree with this), the most significant branding element you have is you, the owner/manager. Love me, love my product. People don't buy products from people they don't like or people who show ambivalence toward them. You might get them once, but restaurants are a game of frequency.
If you support the community, the community will support you.
The second reason most "branding" efforts fail is not knowing what it takes to be successful. Nike is all about the brand and you want to be, too. Never mind how much Nike spent to burnish their sign on consumers' minds, do you know how many local road races they sponsored? How many pairs of shoes they gave away to opinion leaders in the running, basketball, and golf communities?
Branding takes time, effort, and money. It's worth all of those things, but it also takes patience. Just because you opened your restaurant doesn't mean everyone will flock to it. Just because you bought the ads doesn't mean people saw them.
Branding is a process that needs to begin prior to opening, and then be consistently applied forever. Coupons (see previous post) can help fill the gap until your branding efforts take hold.
But when it comes right down to it, knowing (and liking) the owner is the most powerful brand message anyone can have.
Branding is everything about your restaurant. Menu design, menu pricing, and menu content all indicate your brand to users. Staff uniforms, appearance, and professionalism contribute significantly.
However, most restaurants only focus on print materials or logos as their brand. That stuff is important, but by not realizing what the brand is, people waste money by spending cash on advertising, and skimping on research and hourly wages.
For independents and franchises alike (though most new franchisees disagree with this), the most significant branding element you have is you, the owner/manager. Love me, love my product. People don't buy products from people they don't like or people who show ambivalence toward them. You might get them once, but restaurants are a game of frequency.
If you support the community, the community will support you.
The second reason most "branding" efforts fail is not knowing what it takes to be successful. Nike is all about the brand and you want to be, too. Never mind how much Nike spent to burnish their sign on consumers' minds, do you know how many local road races they sponsored? How many pairs of shoes they gave away to opinion leaders in the running, basketball, and golf communities?
Branding takes time, effort, and money. It's worth all of those things, but it also takes patience. Just because you opened your restaurant doesn't mean everyone will flock to it. Just because you bought the ads doesn't mean people saw them.
Branding is a process that needs to begin prior to opening, and then be consistently applied forever. Coupons (see previous post) can help fill the gap until your branding efforts take hold.
But when it comes right down to it, knowing (and liking) the owner is the most powerful brand message anyone can have.
Wednesday
Series: After Coupons, Part 1
Anyone who has been through my restaurant marketing class knows that I advocate, in many spots, coupons. There's good reason for that.
Coupons have gotten a bad name because of how the pizza companies did them: always being ho's for the dough, they practically begged customers to call them. Others followed suit with "$1 off" coupons. These only condition customers to wait for coupons (and even ask for them at the register).
They don't change behavior, they don't build loyalty. In fact, most customers lose respect for you.
So why coups? First off, Procter and Gamble spends millions on coupons every year. What do they know that we don't? P&G uses coups to guide people from being non-users, to trying products, to purchasing more product, to being loyal users. There's a method to their madness.
Second, nothing works like a freebie for new people. You can argue all you want, but when it comes down to it, with a freebie they either like you or they don't and the cost per customer gained is far, far lower than putting your logo out there and hoping someone tries you. Coupons are especially good for moving the relationship along.
Third, marketing new or existing products/dayparts/services to existing customers just makes sense. They've tried you, there is no media cost to reach them, and they're prepared to spread word of mouth. But you need to make sure you're not just giving something away, you're trading value for value. "If you do this for me, I'll do this for you."
Three uses for coupons to existing customers:
a) introduce new menu items or incentivize purchase of existing menu items (the more they have tried, the more they will love you);
b) get existing customers to try specific services (carry-out) or dayparts; or
c) increase the ticket average by adding value (get free dessert with any lobster purchase).
If you give regulars more reasons to visit, you'll see them more often. That's worth giving them a free side item, beverage, or dessert. Honest.
There are right ways and wrong ways to coupon, but most of the discussion focuses on tactics (use short expiration date). The strategy of coupons, however, should be to modify behavior and/or jump start sales (an LTO, for example).
In this series, we'll discuss four ways to market your products, with very little money and without the use of coupons.
Coupons have gotten a bad name because of how the pizza companies did them: always being ho's for the dough, they practically begged customers to call them. Others followed suit with "$1 off" coupons. These only condition customers to wait for coupons (and even ask for them at the register).
They don't change behavior, they don't build loyalty. In fact, most customers lose respect for you.
So why coups? First off, Procter and Gamble spends millions on coupons every year. What do they know that we don't? P&G uses coups to guide people from being non-users, to trying products, to purchasing more product, to being loyal users. There's a method to their madness.
Second, nothing works like a freebie for new people. You can argue all you want, but when it comes down to it, with a freebie they either like you or they don't and the cost per customer gained is far, far lower than putting your logo out there and hoping someone tries you. Coupons are especially good for moving the relationship along.
Third, marketing new or existing products/dayparts/services to existing customers just makes sense. They've tried you, there is no media cost to reach them, and they're prepared to spread word of mouth. But you need to make sure you're not just giving something away, you're trading value for value. "If you do this for me, I'll do this for you."
Three uses for coupons to existing customers:
a) introduce new menu items or incentivize purchase of existing menu items (the more they have tried, the more they will love you);
b) get existing customers to try specific services (carry-out) or dayparts; or
c) increase the ticket average by adding value (get free dessert with any lobster purchase).
If you give regulars more reasons to visit, you'll see them more often. That's worth giving them a free side item, beverage, or dessert. Honest.
There are right ways and wrong ways to coupon, but most of the discussion focuses on tactics (use short expiration date). The strategy of coupons, however, should be to modify behavior and/or jump start sales (an LTO, for example).
In this series, we'll discuss four ways to market your products, with very little money and without the use of coupons.
Thursday
Guiding Principles of Local Store Marketing
Local store marketing is all the rage - again. It seems like everyone flocks to LSM in tough economic times, forgetting that its relationship building and revenue generating tactics are some of the most effective and least costly tools around.
But not everyone will be successful at local store marketing, primarily for one reason only: They don't understand the philosophy behind it. They love the "cheap", "out of the box" ideas, but forget that there's a proven system behind the tactics.
So, if you're really interested in making LSM work for you, keep in mind the following principles.
1. LSM is about frequency of message, not reach
2. LSM is local in nature - 3-5 miles in densely populated markets
3. Persistence is worth as much as, or more than, creativity
4. Add creativity to persistence and you've got a winner
5. Good Local Store Marketing creates a buzz among existing customers that attracts new ones
6. LSM should be measurable
7. LSM considers the lifetime value of a customer, not his/her per visit worth
8. Marketing costs should be measured in cost per customer gained, NOT in cost per thousand
9. If you care about what your customers care about, they'll care about your business
10. LSM can be hard work, but if it's not fun, you're not doing it right
But not everyone will be successful at local store marketing, primarily for one reason only: They don't understand the philosophy behind it. They love the "cheap", "out of the box" ideas, but forget that there's a proven system behind the tactics.
So, if you're really interested in making LSM work for you, keep in mind the following principles.
1. LSM is about frequency of message, not reach
2. LSM is local in nature - 3-5 miles in densely populated markets
3. Persistence is worth as much as, or more than, creativity
4. Add creativity to persistence and you've got a winner
5. Good Local Store Marketing creates a buzz among existing customers that attracts new ones
6. LSM should be measurable
7. LSM considers the lifetime value of a customer, not his/her per visit worth
8. Marketing costs should be measured in cost per customer gained, NOT in cost per thousand
9. If you care about what your customers care about, they'll care about your business
10. LSM can be hard work, but if it's not fun, you're not doing it right
Monday
A New Take On Restaurant Demographics
Two questions:
1. Who is your target audience?
2. Does target audience really matter at all?
The answer to the second question depends on whether you plan to use mass media. If you do, target audience is important in choosing your media. If you do not plan to use mass media, then I suggest definition of target audience different than the traditional definition.
My definition: Anyone who likes your category of food and is willing to dine out at your price point is your target audience. Male, female; old, young; rich, poor; they're all your audience as long as they have money to spend.
Wait a minute. You can't fool us. We know from our marketing classes and years of experience that we want to attract certain demographics.
True. To a point. You see demographics are good for determining where to open your location, what your interior should look like, what menu items you offer, what your price point is, and a whole range of decisions.
But if you're reading this, those decisions have been made already and your restaurant is open. So your new target audience is anyone living or working within a 5 minute drive who likes barbecue (or salads or burritos or pizza).
If you can't get locals to visit, good luck getting someone who fits your demographics to a T to drive 15 minutes in heavy traffic and pass countless other, similar restaurants just because they like you better. It rarely happens. You wouldn't do it, why would they?
Plus, if you're the Mayor of Your Village, shaking hands, kissing babies, then your efforts are more about salesmanship than marketing. Marketing is a message sent to the masses, but local store marketing is about crafting a message for a particular group in the community. Love me, love my product. You are the brand.
Ok, Ok. Demographics aren't completely useless after you're open. They can help you figure out who your heavy users are, what's important to them, and how you can get them to bring their friends.
Demographics matter, but once you've signed the lease they're secondary. Now it's all about convincing those who are near you to frequent you.
1. Who is your target audience?
2. Does target audience really matter at all?
The answer to the second question depends on whether you plan to use mass media. If you do, target audience is important in choosing your media. If you do not plan to use mass media, then I suggest definition of target audience different than the traditional definition.
My definition: Anyone who likes your category of food and is willing to dine out at your price point is your target audience. Male, female; old, young; rich, poor; they're all your audience as long as they have money to spend.
Wait a minute. You can't fool us. We know from our marketing classes and years of experience that we want to attract certain demographics.
True. To a point. You see demographics are good for determining where to open your location, what your interior should look like, what menu items you offer, what your price point is, and a whole range of decisions.
But if you're reading this, those decisions have been made already and your restaurant is open. So your new target audience is anyone living or working within a 5 minute drive who likes barbecue (or salads or burritos or pizza).
If you can't get locals to visit, good luck getting someone who fits your demographics to a T to drive 15 minutes in heavy traffic and pass countless other, similar restaurants just because they like you better. It rarely happens. You wouldn't do it, why would they?
Plus, if you're the Mayor of Your Village, shaking hands, kissing babies, then your efforts are more about salesmanship than marketing. Marketing is a message sent to the masses, but local store marketing is about crafting a message for a particular group in the community. Love me, love my product. You are the brand.
Ok, Ok. Demographics aren't completely useless after you're open. They can help you figure out who your heavy users are, what's important to them, and how you can get them to bring their friends.
Demographics matter, but once you've signed the lease they're secondary. Now it's all about convincing those who are near you to frequent you.
Tuesday
Word of Mouth: Let your customers do the talking
[Note: if your customer service and overall customer experience aren't perfect, please disregard this post.]
We all know that word of mouth is the best form of advertising, yet few of us consciously do anything to spread word of mouth. It's like we take it for granted - if customers enjoyed my restaurant, they'll tell their friends.
Maybe, but why not encourage it? Below are some tips to help increase positive word of mouth, instead of simply waiting for it to happen:
1. Ask for it. At one restaurant I know the owners and managers walk the tables with the standard conversation of "How was everything?" - with one major difference. If the answer is "great" then the follow up question is "Good enough for you to tell your friends?"
2. Complementary audiences. PR works so well because we target thought leaders, usually media people such as DJ's and food critics, who have credibility. At the local store level, why not target ministers, principals, event chairs, and charity heads?
3. Make it special. Few people offer their thoughts on merely adequate experiences. If the dinner was 'fine' and not 'great', don't expect much play. Go out of your way to make an experience special for someone. That might mean anticipating the need for a high chair for a frazzled mom, providing dessert for a group of kids, or soliciting the opinions of a group of lunching business women. Make a personal contact, look for ways to exceed expectations.
4. Small groups work best. Word of mouth spreads faster within small groups than the world at large. Target your audiences, identify the key influencers, and solicit their goodwill. Don't leave an audience until you've won them over, then go after the next audience.
One estimate I heard recently is that half of your business can come from word of mouth within 3 years, all of it within 5 years. WOM is slower than some media because of its personal nature, but its effectiveness and the loyalty it generates can't be denied.
We all know that word of mouth is the best form of advertising, yet few of us consciously do anything to spread word of mouth. It's like we take it for granted - if customers enjoyed my restaurant, they'll tell their friends.
Maybe, but why not encourage it? Below are some tips to help increase positive word of mouth, instead of simply waiting for it to happen:
1. Ask for it. At one restaurant I know the owners and managers walk the tables with the standard conversation of "How was everything?" - with one major difference. If the answer is "great" then the follow up question is "Good enough for you to tell your friends?"
2. Complementary audiences. PR works so well because we target thought leaders, usually media people such as DJ's and food critics, who have credibility. At the local store level, why not target ministers, principals, event chairs, and charity heads?
3. Make it special. Few people offer their thoughts on merely adequate experiences. If the dinner was 'fine' and not 'great', don't expect much play. Go out of your way to make an experience special for someone. That might mean anticipating the need for a high chair for a frazzled mom, providing dessert for a group of kids, or soliciting the opinions of a group of lunching business women. Make a personal contact, look for ways to exceed expectations.
4. Small groups work best. Word of mouth spreads faster within small groups than the world at large. Target your audiences, identify the key influencers, and solicit their goodwill. Don't leave an audience until you've won them over, then go after the next audience.
One estimate I heard recently is that half of your business can come from word of mouth within 3 years, all of it within 5 years. WOM is slower than some media because of its personal nature, but its effectiveness and the loyalty it generates can't be denied.
Monday
Encourage Word of Mouth Advertising
In my marketing training classes, I always ask the question: "What is the best form of advertising?" The answer, nearly always from class to class, is word of mouth.
So the next question is: "What types of things engender positive word of mouth?" Here we get everything from great customer service to making guests feel special to creative promotions and events.
Finally, I ask: "Why the disconnect?" If we know that positive word of mouth is the best form of marketing and advertising, and we know that giving an outstanding customer experience, having fun with guests and treating them special lead to positive word of mouth...why do we spend our marketing and advertising dollars on print and broadcast media?
What was the last radio commercial you heard? What is your favorite newspaper ad, one that you and your friends all agree is really effective as you're discussing it over a beer or two?
Multiple channels, iPods, CDs, DVDs, the Internet, Tivo, pay-per-view, Netflix, cell phones, and the good old fashioned radio dial all contribute to a consumer's ability to avoid your ad. Yet we continue to spend money on "awareness" advertising for our restaurants, instead of moving money from the advertising budget to the promotional budget for things like key chains, free beverages, free appetizers, etc.
In other words, the things that will create a bond and promote word of mouth.
Knowing what you want to accomplish is critical before spending money to promote your restaurant. Ask yourself how much word of mouth your newspaper ad will generate, then act accordingly.
So the next question is: "What types of things engender positive word of mouth?" Here we get everything from great customer service to making guests feel special to creative promotions and events.
Finally, I ask: "Why the disconnect?" If we know that positive word of mouth is the best form of marketing and advertising, and we know that giving an outstanding customer experience, having fun with guests and treating them special lead to positive word of mouth...why do we spend our marketing and advertising dollars on print and broadcast media?
What was the last radio commercial you heard? What is your favorite newspaper ad, one that you and your friends all agree is really effective as you're discussing it over a beer or two?
Multiple channels, iPods, CDs, DVDs, the Internet, Tivo, pay-per-view, Netflix, cell phones, and the good old fashioned radio dial all contribute to a consumer's ability to avoid your ad. Yet we continue to spend money on "awareness" advertising for our restaurants, instead of moving money from the advertising budget to the promotional budget for things like key chains, free beverages, free appetizers, etc.
In other words, the things that will create a bond and promote word of mouth.
Knowing what you want to accomplish is critical before spending money to promote your restaurant. Ask yourself how much word of mouth your newspaper ad will generate, then act accordingly.
Friday
Trial, Frequency, Ticket Average - Not Just for Restaurants
For those still in doubt as the wisdom of narrowing your marketing objective to one (and only one at a time) of three choices, here are a couple of examples of how common the strategy is for nearly any kind of business.
Credit Cards
- Drive Trial: "0% interest for 6 months!"; "0% interest on all balance transfers!"
- Increase Frequency: "Register to win a million dollars every time you use your card in the month of May!"; "Earn double rewards points with every purchase!"; "Get cash back/free gasoline with every purchase!"
- Increase Ticket Average: "Free lost-baggage insurance"; "Get a rental car/hotel room upgrade when you purchase both on our card"; "Revolving credit on any single purchase over $200"
Cell Phones- Drive Trial: "Get a Free phone!"
- Increase Frequency: "1,000 weekend minutes!"; "First 10 text messages are free!" (note that free texting drives Trial of a different service, which leads to increased usage, which leads to increased ticket average); of course, frequency is also built in with the contract
- Increase Ticket Average: Text messages, ringtones
Now consider how Procter & Gamble moves consumers from Trial to Frequency to Ticket Average for Crest toothpaste:
- Customer receives free sample in the mail along with coupon off first purchase
- Customer receives buy one/get one free coupon (Mom and Dad use it, now it will be in the kids' bathroom too)
- Packaging states "20% more for free!" - consumers become accustomed to purchasing the larger size (and getting two of them)
- 20% promotion is pulled away, leaving consumers happy purchasing two larger tubes.
Restaurants are no different, and no one tactic can achieve all of the goals. You need more than a laundry list of "creative" tactics (but those are fun, and they will work if used properly). You need a little discipline from the advertising world to make all those ideas work.
Credit Cards
- Drive Trial: "0% interest for 6 months!"; "0% interest on all balance transfers!"
- Increase Frequency: "Register to win a million dollars every time you use your card in the month of May!"; "Earn double rewards points with every purchase!"; "Get cash back/free gasoline with every purchase!"
- Increase Ticket Average: "Free lost-baggage insurance"; "Get a rental car/hotel room upgrade when you purchase both on our card"; "Revolving credit on any single purchase over $200"
Cell Phones- Drive Trial: "Get a Free phone!"
- Increase Frequency: "1,000 weekend minutes!"; "First 10 text messages are free!" (note that free texting drives Trial of a different service, which leads to increased usage, which leads to increased ticket average); of course, frequency is also built in with the contract
- Increase Ticket Average: Text messages, ringtones
Now consider how Procter & Gamble moves consumers from Trial to Frequency to Ticket Average for Crest toothpaste:
- Customer receives free sample in the mail along with coupon off first purchase
- Customer receives buy one/get one free coupon (Mom and Dad use it, now it will be in the kids' bathroom too)
- Packaging states "20% more for free!" - consumers become accustomed to purchasing the larger size (and getting two of them)
- 20% promotion is pulled away, leaving consumers happy purchasing two larger tubes.
Restaurants are no different, and no one tactic can achieve all of the goals. You need more than a laundry list of "creative" tactics (but those are fun, and they will work if used properly). You need a little discipline from the advertising world to make all those ideas work.
Thursday
What makes for a great LSM idea?
I've had several people ask lately: "What are some great marketing ideas for my restaurant." I have to admit, I'm generally stumped. The question is similar to "How much does it cost to buy a car?"
I don't mean to be vague here, but we really need more information. It doesn't matter so much what type of restaurant you have, but more what you want to accomplish and when. "We need more customers anytime" isn't enough to go on.
Certain tactics work well for driving trial (which leads to new customers if the experience is WOW!), but are foolish for existing customers. Likewise, doing a really creative promotion with the local high school, no matter how well received, won't improve your breakfast daypart.
First, what do you want to do (pick only one of the three choices):
1. Get more customers? (And for this you need to be sure that you really do need more customers - most restaurants are already leaving enough on the table without any new customers.)
2. Get existing customers to visit more often? This is an easier prospect and generally reveals the fastest results.
3. Get customers to spend more money? It might be that your current offers actually drive down your ticket average. It might also be that current customers don't have a full appreciation for your entire menu - internal promotion can be a powerful thing.
Note: You probably want all three of these things. Be patient - you can only choose one at a time because, as you'll see below, each of these objectives probably has a different audience.
Next, when do you want to achieve these objectives ("now" isn't the answer I'm looking for)?
- Drive trial during lunch?
- Increase frequency of current dinner guests?
- Increase ticket average during the evenings and weekends?
This is where you determine your audience. You wouldn't market to a church or school if your lunch traffic was slow. Likewise, if you want to sell carry-out and increase your evening ticket average, marketing to office buildings won't help much.
Local store marketing is a great tool and is invaluable to countless restaurant and retail merchants. Anyone who knows me knows that I'm passionate about its potential and a true evangelist of its tactics.
But tactics alone won't cut it. A long list of great ideas, without adding a framework to it, will only disappoint in the end. If you want results, you need to carefully consider your objective and audience. These will determine your media and tactics, not the other way around.
I don't mean to be vague here, but we really need more information. It doesn't matter so much what type of restaurant you have, but more what you want to accomplish and when. "We need more customers anytime" isn't enough to go on.
Certain tactics work well for driving trial (which leads to new customers if the experience is WOW!), but are foolish for existing customers. Likewise, doing a really creative promotion with the local high school, no matter how well received, won't improve your breakfast daypart.
First, what do you want to do (pick only one of the three choices):
1. Get more customers? (And for this you need to be sure that you really do need more customers - most restaurants are already leaving enough on the table without any new customers.)
2. Get existing customers to visit more often? This is an easier prospect and generally reveals the fastest results.
3. Get customers to spend more money? It might be that your current offers actually drive down your ticket average. It might also be that current customers don't have a full appreciation for your entire menu - internal promotion can be a powerful thing.
Note: You probably want all three of these things. Be patient - you can only choose one at a time because, as you'll see below, each of these objectives probably has a different audience.
Next, when do you want to achieve these objectives ("now" isn't the answer I'm looking for)?
- Drive trial during lunch?
- Increase frequency of current dinner guests?
- Increase ticket average during the evenings and weekends?
This is where you determine your audience. You wouldn't market to a church or school if your lunch traffic was slow. Likewise, if you want to sell carry-out and increase your evening ticket average, marketing to office buildings won't help much.
Local store marketing is a great tool and is invaluable to countless restaurant and retail merchants. Anyone who knows me knows that I'm passionate about its potential and a true evangelist of its tactics.
But tactics alone won't cut it. A long list of great ideas, without adding a framework to it, will only disappoint in the end. If you want results, you need to carefully consider your objective and audience. These will determine your media and tactics, not the other way around.
Wednesday
How to Get Frequency of Message
I've had several posts and newsletters about frequency of message, so now might be a good time to discuss how to achieve that frequency.
Frequency of message is the number of times someone sees your message as opposed to how many people see your message, which is reach. The number of impressions it takes to get someone to remember your name and purchase your product is called effective frequency.
Repetition is good for recall and frequency aids repetition. Therefore, frequency of message = good.
You can get a high message frequency from straight advertising. In fact, many companies with large budgets do just that. They even buy out some of the ad clutter, making them even more effective. I'll assume that, if you're reading this, you are more likely to have a shoestring marketing budget (though if you're a big company, drop me a line, I'll guarantee your cost per customer gained will drop like a stone).
If you have a small budget, and you rely on advertising, you're probably purchasing a single ad, or saving your money for TV, and are losing out on frequency (ie: you're going for reach).
Local store marketing tactics are preferable for frequency because the cost of each tactic is lower than purchasing media. More bang for the buck.
A note of caution: If you decide to go with local store marketing you must employ frequency of message. To do only one or two messages, a la advertising, you will get the same poor results as with advertising, but at a lower cost.
Frequency of message can be obtained by using a diverse marketing mix. You must employ more than one of these tactics at a time and you must consistently and persistently apply them. Here are some pieces to the puzzle, in no particular order:
The usual suspects:
The 7 Core Competencies:
Promotional Items:
You get the point. Frequency of message doesn't have to cost a lot of money, but it does need to happen frequently (as the name would imply). To paraphrase Morris Hite: More money is wasted on underspending for advertising that overspending. Advertising doesn't work if you don't put enough resources behind it. Neither does local store marketing.
Frequency of message is the number of times someone sees your message as opposed to how many people see your message, which is reach. The number of impressions it takes to get someone to remember your name and purchase your product is called effective frequency.
Repetition is good for recall and frequency aids repetition. Therefore, frequency of message = good.
You can get a high message frequency from straight advertising. In fact, many companies with large budgets do just that. They even buy out some of the ad clutter, making them even more effective. I'll assume that, if you're reading this, you are more likely to have a shoestring marketing budget (though if you're a big company, drop me a line, I'll guarantee your cost per customer gained will drop like a stone).
If you have a small budget, and you rely on advertising, you're probably purchasing a single ad, or saving your money for TV, and are losing out on frequency (ie: you're going for reach).
Local store marketing tactics are preferable for frequency because the cost of each tactic is lower than purchasing media. More bang for the buck.
A note of caution: If you decide to go with local store marketing you must employ frequency of message. To do only one or two messages, a la advertising, you will get the same poor results as with advertising, but at a lower cost.
Frequency of message can be obtained by using a diverse marketing mix. You must employ more than one of these tactics at a time and you must consistently and persistently apply them. Here are some pieces to the puzzle, in no particular order:
The usual suspects:
- car wrap
- signage
- print and broadcast advertising
- word of mouth (does your advertising generate word of mouth, or is it the customer experience?)
- billboards
The 7 Core Competencies:
- Sampling
- Catering (as marketing)
- Event sponsorship / participation
- Email
- Fishbowls
- In-store signage and merchandising
- Bounce-back coupons
Promotional Items:
- cups
- frisbees
- key chains
- pens
- calendars
- t-shirts
- hats
- kid stickers / tattoos
- coloring sheets
You get the point. Frequency of message doesn't have to cost a lot of money, but it does need to happen frequently (as the name would imply). To paraphrase Morris Hite: More money is wasted on underspending for advertising that overspending. Advertising doesn't work if you don't put enough resources behind it. Neither does local store marketing.
Tuesday
Good Marketing = Message Frequency
A marketing manager called me today and asked for 10 "creative, outside the box ideas" that have worked for other restaurant concepts. I started to rattle off some ideas but I stopped myself and started with a caveat instead: Most ideas are good, if you do them correctly and consistently.
Getting new local store marketing TACTICS is the easy part. But understanding the STRATEGY behind them is often the difference between success and failure.
The strategy behind local store marketing, or any other good marketing for that matter, is frequency of message. Local store marketing makes this easier than advertising because frequency can be achieved for less money.
When tactics fail, it's almost always because there was no strategy behind it. "I tried that once and it didn't work." Nope, probably not. Because sending a message one time rarely finds its mark. Even if it does, people won't remember it. Repeating a tactic, or using multiple tactics (with the same message) for the same audience, works. And LSM makes that a reachable goal.
And therein lies the fallacy. Many owners, and franchisors, are attracted to local store marketing because it can be fun and creative. Its effectiveness, however, is determined by a consistent and persistent message in the marketplace.
For a restaurant franchise, the result of no strategy is a toolbox of tactics that no one uses, ineffective store owners, franchisees who continually need new and increasingly specialized "tools", and a business consultant who needs new ideas (they've become disposable).
For a single-unit operator, the result of no strategy is frustration, followed by eroded profitability, followed by decreased customer base. Wasting money on marketing is the same whether you do it inexpensively (LSM) or expensively (advertising).
Getting new local store marketing TACTICS is the easy part. But understanding the STRATEGY behind them is often the difference between success and failure.
The strategy behind local store marketing, or any other good marketing for that matter, is frequency of message. Local store marketing makes this easier than advertising because frequency can be achieved for less money.
When tactics fail, it's almost always because there was no strategy behind it. "I tried that once and it didn't work." Nope, probably not. Because sending a message one time rarely finds its mark. Even if it does, people won't remember it. Repeating a tactic, or using multiple tactics (with the same message) for the same audience, works. And LSM makes that a reachable goal.
And therein lies the fallacy. Many owners, and franchisors, are attracted to local store marketing because it can be fun and creative. Its effectiveness, however, is determined by a consistent and persistent message in the marketplace.
For a restaurant franchise, the result of no strategy is a toolbox of tactics that no one uses, ineffective store owners, franchisees who continually need new and increasingly specialized "tools", and a business consultant who needs new ideas (they've become disposable).
For a single-unit operator, the result of no strategy is frustration, followed by eroded profitability, followed by decreased customer base. Wasting money on marketing is the same whether you do it inexpensively (LSM) or expensively (advertising).
More Frequency in Reverse
An article in the Wall Street Journal (Friday, 3/14/08) highlights a long-term trend with negative effects on local restaurants: Stay at home moms are staying at home.
The article notes that the percentage of women in the workforce is at 59.2%, down from 60% at its peak. Not much change, huh? Why worry about that small of a gap? In 2001, 211 meals (per person) were purchased outside the home, last year that fell to 207. What does that do to sales?
To keep math easy, let's assume you have 3,000 unique customers, each visiting every other week (1,500 transactions per week). Now figure that each customer eats out 4 fewer times per year, for 12,000 fewer transactions per year. Multiply that times a $10 ticket average and you're down $120,000 per year. Sounds about right in terms of your decline, doesn't it?
As more women are staying home, and with the rise in home cooking shows, they're preparing more meals in the home. Just as getting 2 more visits per year is important to your Frequency of Visit, so is losing 2 visits per year dangerous to your bottom line.
But what can be done? First, take care of your guest. One in 10 people is willing to never visit a restaurant again if they have a bad experience. You can't be mayor of your village unless you're the mayor of your store first. Taking care of what you have will help retain as much as 10% of your base, decrease costs of gaining new customers, and help to increase frequency of visit.
Next, focus some energies on out of store products. Carry-out, family meals, healthier on-the-go offerings. Then use your current customer base to promote these items. Frequency of visit comes when you satisfy more than one buying decision. Feeding a family at home is a different buying decision than stopping for lunch with a friend.
Lastly, view this trend as an opportunity. People still eat out an average of 207 times per year. Clearly customers don't frequent your restaurant all 207 times, but what if you could get them 4 more times? What if your fantastic, over the top customer service, coupled with a clear objective to introduce customers to the rest of your menu, resulted in increased share of wallet?
How's $120,000 extra dollars per year sound?
The article notes that the percentage of women in the workforce is at 59.2%, down from 60% at its peak. Not much change, huh? Why worry about that small of a gap? In 2001, 211 meals (per person) were purchased outside the home, last year that fell to 207. What does that do to sales?
To keep math easy, let's assume you have 3,000 unique customers, each visiting every other week (1,500 transactions per week). Now figure that each customer eats out 4 fewer times per year, for 12,000 fewer transactions per year. Multiply that times a $10 ticket average and you're down $120,000 per year. Sounds about right in terms of your decline, doesn't it?
As more women are staying home, and with the rise in home cooking shows, they're preparing more meals in the home. Just as getting 2 more visits per year is important to your Frequency of Visit, so is losing 2 visits per year dangerous to your bottom line.
But what can be done? First, take care of your guest. One in 10 people is willing to never visit a restaurant again if they have a bad experience. You can't be mayor of your village unless you're the mayor of your store first. Taking care of what you have will help retain as much as 10% of your base, decrease costs of gaining new customers, and help to increase frequency of visit.
Next, focus some energies on out of store products. Carry-out, family meals, healthier on-the-go offerings. Then use your current customer base to promote these items. Frequency of visit comes when you satisfy more than one buying decision. Feeding a family at home is a different buying decision than stopping for lunch with a friend.
Lastly, view this trend as an opportunity. People still eat out an average of 207 times per year. Clearly customers don't frequent your restaurant all 207 times, but what if you could get them 4 more times? What if your fantastic, over the top customer service, coupled with a clear objective to introduce customers to the rest of your menu, resulted in increased share of wallet?
How's $120,000 extra dollars per year sound?
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