Restaurant Commando (Restaurant Marketing Formula)

Don’t Be A Restaurant Owner

By Chief Commando | October 2, 2008

Restaurant Owner vs Strategic Business Owner Steve in Florida is writing…

Hello, I am based in Miami and have been following the <type of concept> that seems prevalent in CA and almost non-existent here in South FL. I am a business person who is seeking to open such an establishment <…> I do not have experience in the food industry but would be “passionate” about starting this kind of concept here in FL. With this said, would you happen to have any advice in starting things up (other than the usual stuff such as money, etc.)… I’m looking for investors yet but more importantly… looking for some “wisdom” from veterans of the biz who have been in the “trenches”.

Thanks,

Steve

Okay, Steve. Congratulations on having a dream that is big and the passion for restaurant business that is contagious.

As for the restaurant business “wisdom” piece, here’s a little something I want you to take to heart. (And it applies equally to those who are just starting out and those who have been running a restaurant for decades.)

Here it is:

Don’t be a restaurant owner.

Be a Strategic Business Owner.

I could — and one day I will — write an entire book on this subject. Until then, here’s the “skinny” for you, the 9 traits that make your restaurant success more probable (those in the right column):

Restaurant Owner	Strategic Business Owner
Tactical	Strategic
Spends most of the time working “in” the business	Spends most of the time working “on” the business
Assumes better food and service will cause customers to beat a path to his door	Has a marketing plan in place and creates special reasons for customers to come back
Thinks “everyone” needs his food and “everybody” should want it	Has a clear picture of “ideal customer” and knows exactly what these people want and don’t want
Considers the equipment in the kitchen, the furniture in the dining room, and the building the restaurant is in the biggest assets his restaurant has	Knows that the customer list is his business’ biggest asset, is a freak about adding more customers to it all the time and follows up with them relentlessly
Can’t see any other way to make more profits in his restaurant other than sell more food	His mind is open to creative ways of adding more value-added goods and services that customers happily and eagerly buy
Is focused on building a “transactional” income	Is focused on building a “relationship” income
Tries to win in the marketing game all by himself	Is always on a lookout for profitable joint venture opportunities with other local businesses
Owns a job	Owns a real business

Some of these may appear criptic. Many may seem to fly in the face of the “restaurant marketing” common sense.

So they are and so they do.

We’ll expand on these in the future newsletters. Until then, print out this list and post it in a place where you’ll see it often. The more you read these the more sense they will make to you. And the better you understand them, the greater your chances will be of creating a successful and profitable restaurant business.

Topics: Restaurant Busintss, Restaurant Owner | No Comments »

Marketing A Restaurant In A Slow Economy (part deux)

By Chief Commando | September 27, 2008

Restaurant Marketing Lessons from Olive Garden

This is the second article in the series on how to market a restaurant during the economic slow-down and what a successful concept like Olive Garden does to grow when almost everybody else is shrinking. Loosely based on the information revealed in their Q1 2009 conference call.

4. Expand into new markets

Olive Garden has seen a lot of response from their Hispanic ads targeted at the new, fast-growing, and dynamic market. This endeavor also includes Hispanic menus, and (since there was no mentioning of that in the conference call, I’m extrapolating) Hispanic staff, effectively positioning Olive Garden to Hispanic clientele as “their” place to eat out at.

There could be at least two possible takeaways for you related to restaurant marketing:

a) The Hispanic market is less saturated by other advertisers but is as hungry as any other. You may get a better bang for your marketing dollars by expanding into it.

b) Too many businesses in general, and restaurants in particular, are too stubborn to try to find a new market. The correct approach is to tackle one market at a time. Once you have won over one market, regroup and stage a crusade on another one. Examples of markets include particular occupations, age groups, hobbyists and enthusiasts. For instance, if you’ve built a successful VIP Club for golfers, you can create an additional VIP Club for children that take up golf.

5. When consumers tighten their purse strings, they go to fewer restaurants but frequent their favorite place almost as often as before

This is a very important pattern to observe and is a direct result of “winner takes it all” rule in action. In other words, you don’t have to win by a mile, you just have to win.

A restaurant that provides a slightly better food, a slightly better service, and does a slightly better job of staying in touch with their customers will do disproportionately better than their competition. And given that most restaurants don’t bother to revamp their boring food, never get around to properly train their staff, and have no concept of investing into a relationship with their customers, you just need to do a few things right (not perfect, just a teeny weenie bit better than the next guy) to do well while your competition is crushing and burning.

6. (I know I promised 5 “secrets”. This one is a bonus lesson in restaurant marketing, so stop complaining.) Here it is: Be ready to capture more customers when competition throws in the towel and turns the lights off

Well, this particular observation didn’t come from the conference call per ce. Clarence Otis (Darden’s CEO) appeared on Jim Cramer’s Mad Money the night before the conference call and referenced the shut downs of Benigan’s.

Turns out, several of the Olive Garden stores are located next to the now-defunct Benigan’s and saw a “pick up” of consumer traffic.

When a restaurant closes in your locale, be ready to meet new customers. By “be ready” I mean “have the tools and processes in place to turn these first-timers into regulars, and regulars into raving fans”. Otherwise your euphoria will be extremely short-lived.

Topics: Restaurant Marketing | No Comments »

Marketing A Restaurant During The Economic Slow-Down: 5 Surprising Restaurant Marketing Lessons From Olive Garden (Darden Restaurants)

By Chief Commando | September 24, 2008

A quick story today with a critical take-away for your restaurant business, and an important announcement at the end.

Onwards to a story…

Last week I decided to pop in on the Darden Restaurants shareholder conference call. When a company like this is sharing what they do and why, and what they see going on in the market place, I sit up and listen. Nobody gets to be a 170,000-employee company by sheer luck. There is always a reason and a method.

Apparently, I wasn’t the only one listening to that call (manufactured laughter goes here). The next morning food-service & restaurant publications were super-prompt to announce that Darden was “finally” experiencing a slowdown because of the state of the economy (big deal).

And they entirely missed the point that I found the most important.

Yes, pretty much all of Darden’s concepts were down by about 3.7%, which is on par with the overall foodservice industry index. But… Olive Garden (one of Darden’s concepts) was doing extremely well.

Olive Garden grew 5% compared to the same quarter last year!

Not a single analyst noted this very remarkable fact — Olive Garden is doing well. In fact, so well compared to the rest of the industry, it deserves a look to understand what specifically they do and how they get to be so successful.

So here’s a list of 5 things that you should do in your restaurant to replicate the success they are experiencing (loosely based on the information of that conference call, with my interpretation):

1. When the economy is slow, step up your marketing

When the cold winds of the economic slowdown come to the city, most businesses respond by cancelling their advertising. They crawl into the shell and try to wait it out, hoping for a miracle.

Smart restaurant owners do the reverse. They ramp up their marketing: It’s so much easier to get heard in the market when everybody else is hiding. Smart restaurant owners also know better than to equate marketing to advertising: There are marketing methods that are more effective and less costly than advertising.

2. Stay on their minds

Olive Garden uses creative advertising to remind their customers they are still here. They manage to stay at the forefront of their customers’ minds via TV ads.

As much as this approach could be good for a large company like Darden, however, such a stunt could be suicidal for a small restaurant: Running image ads on TV is a costly and arguably the least effective way to advertise. It is called “branding,” or more specifically, “macro-branding.”

The other, less expensive, and more targeted way to stay on your customers’ minds is called “micro-branding.” This includes a variety of ways to “touch” them, via email newsletters, event announcements, greeting cards, phone messages, and printed newsletters. Many of these tools are either free or inexpensive. And they are relatively easy to track. There is no excuse not to use them.

3. Create reasons for them to come in again and again

Olive Garden keeps coming up with new items and specials, and they syncronize promotions with the release of the new menu item. You can do the same. And it’s easy to inform your list about new menu items. That is, if you have a list (see strategy #2 above).

Also, you can create many more reasons for your customers to come back — many of which may have nothing to do with the food (e.g. special events and “happenings”).

I’ll cover two more lessons in a separate post, tomorrow.

Now, the announcement.

We are running a 2-day intensive Restaurant Profit Bootcamp in Austin, Texas, on October 6 & 7 — see www.RestaurantProfitBootcamp.com. We can only accommodate 28 people (that’s 30, as allowed by the fire code, minus the two instructors), and 6 seats are gone as I’m writing this.

If you’re serious about becoming a true Restaurant Commando and receive a complete arsenal of tools to deal with any hostile market situation, you can’t afford to miss The Bootcamp.

Topics: Restaurant Marketing | No Comments »

Want The Password?

By Chief Commando | September 16, 2008

Would you like the password for the prior posts?

Sorry. It’s too late.

But it’s not too late to sign up to get access to RestaurantCommando.com’s password-protected posts in the future. We post them every time we have something extra exciting to share with our subscribers.

Subscribing is free. It’s easy. And it’s safe.

Here’s how it works:

1. Find that picture of a special report in the upper-right corner (yeah, that one with a girl on the cover.) Found it? Beneath is a form. It only asks for two items of information about you.

Enter your name in the first blank. You can enter a fake name. That’s fine. You can enter just your first name. That’s fine too.

Enter your email address in the 2nd blank. You must enter your real email address. We’ll be sending you future passwords by email, so if you don’t enter a real email address, you won’t get them.

2. Click the button to submit your information. It’s safe with us. We won’t share it with anyone. We will only use it to send a short email telling you each time there is a new blog entry. The password will be included with any password-protected blog entry.

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In the future, when we post a password-protected blog entry (and those are always the best blog entries, with the most valuable information), you will get the password by email. Easy, huh?

Every single email we send you will have an unsubscribe link. So you can change your mind at any time. If you want to stop getting blog announcements, just click the link provided in any email we send you. It’s that simple.

What are you waiting for?

Regards,

Chief Commando

Topics: General | No Comments »

Protected: How Well-Meaning Restaurant Owners Deprive Themselves Of Time, Profits, and Success… and How To Avoid Making Their Mistakes

By Chief Commando | September 16, 2008

Topics: Restaurant Marketing | Enter your password to view comments

Grand Opening? Soft Opening?

By Chief Commando | September 9, 2008

Lori, a reader from Florida, says she’s opening a restaurant (congratulations!) and asks this:

“What is the best to open this restaurant? Grand opening or soft? Have heard arguments for both…”

Well, let’s see…

The arguments for either one are missing the point. It’s not one versus the other.

Doing just the soft opening is silly. It like saying, “Well, let’s see if this whole restaurant thing is for me. If enough people find out about me, I guess we’ll keep on cooking.” You quit before you’d started. And when you did start, you did it with a severe handicap to your competition.

On the other hand, starting out with a bang and succeeding in attracting a lot of people fast could be as bad. Your kitchen may implode on the very first night. The logistics get intricate and the sparks fly when you have 50 four-tops sitting there for 2 hours waiting for their plates to come out. Ugly.

The correct answer is, you need a soft opening followed by a grand opening 3 or 4 weeks later. The soft opening gives you a chance to work out all the logistical kinks, train the staff, tweak the menu, and really understand who you want to attract as a customer. This way you are in a position to hit a home run on the night of the grand opening.

That’s why soft opening first, then grand.

Also, the idea that there can only be one Grand Opening for a restaurant ever is totally, utterly, absolutely false. You can — and should — have as many grand openings as you want and need. Once it gets too repetitive, you can call them “special events”.

And this is when the calendar becomes your biggest friend.

Which it what we cover in depth in the Instant VIP Clubs course.

Topics: General, Restaurant Marketing | No Comments »

Higher Menu Prices and Congruency

By Chief Commando | August 26, 2008

A fresh restaurant marketing story for you with a wee bit of a moral in the end.

In order to be able to set and maintain higher menu prices than those of your competition, you need to carefully “choreograph” all elements of your customer’s experience. And in that, no detail is too small.

Onwards to a story.

We just had a nice dinner in San Simeon, California. A tiny village halfway between LA and San Francisco with a population of 400, it consists of a gift shop and maybe a dozen of hotels and restaurants on both sides of Hwy 1.

Given the geographic location (middle of nowhere), we didn’t expect much from the seafood restaurant attached to the hotel where we stayed for the night. Least of all did we expect their menu to demand a more-than-respectable $21+ average per entree.

Yet that’s exactly what it did.

A family with 2 kids at the table next to us, not able to cope with the sticker shock, got up noisily and hurried out the door in search of a more affordable option. (Kudos to the Maitre D’ who was prompt, vocal, and sincere in thanking them for coming and making it appear to the other guests as if he was parting with his best friends.)

We stayed. Part too lazy to move our buns, part curious to see how the kitchen would live up to a relatively high bar they’d set for themselves.

The restaurant was about half-full. The day being Monday, and many of the kids being back at school, that looked like a good night.

The waiter did his part well all the way, from offering the drinks to suggesting the specials, to becoming invisible when we didn’t need him, to re-appearing when we did. The food was worth every dollar the menu demanded for it, and possibly more.

Looks like we had a winner.

Except for one small but nagging detail.

Which was the busgirl (the person making the least money of all the people at the store that night) who answered every “thank you” with a dewy-eyed “uhuh”.

Now, since when does “uhuh” mean “you’re welcome”?

I found myself thinking about how well everything that night was orchestrated to make my experience congruent with the menu and to make me happy to part with the money.

And also thinking about how every lumpish “uhuh” thrown at me negated everything good that had happened to that point, and reminded of how far away from the city we were.

That is called incongruency and it is your biggest obstacle to your ability to increase and maintain higher check averages.

When it comes to restaurant marketing, little things aren’t little anymore. They are everything.

Three questions for you to ponder (your restaurant business will soar once you find answers to these):

How should you “choreograph” your customers’ experience?
How do you train your waitstaff now and how should you really train them?
How can you ensure they don’t bring their hapless social habits into your restaurant?

Topics: Menu Management, Restaurant Marketing | No Comments »

Restaurant Coupon Marketing: The 2-For-1 Deal Is Dead

By Chief Commando | August 12, 2008

Restaurant coupons are a double-edged sword. Used the right way, they can get you a swarm of new guests. Used the wrong way, they will train your existing customers never to buy your food without a discount.

You can hardly surprise anyone with a 2-for-1 deal these days. You can hardly entice them either. A discount that is attached to an entree is like a vacuum cleaner sucking the cash out of your wallet. This is NOT the right way to run a restaurant.

Here’s the deal.

A discount is just one of the ways to create value for your customers. One of many.

Once you understand this, you’re on the right path to what my good friend Nathan Gilder calls “clever coupons.”

Here’s an example of a clever coupon:

“Free Homemade Brownie with Footlong Sub!”

Some guests have a weird craving for chocolate after downing one of our famous subs. Well… we give in… for the next three weeks you can get a free, delicious homemade brownie with any footlong.

This is a real one used by a restaurant owner who enjoyed an extra $1,225.87 in profit that month.

Clever coupons are the kind that:

create curiosity;
offer a bundled deal, never a blatant discount;
give away something that your customers want and that is NOT an entree;
require customers to do something to qualify for the special;
are unique and unusual.

Nathan has put together a Special Report entitled Using Restaurant Coupons and that’s where I found the example above. The report has several more outstanding examples in it. Go there now. See it for yourself.

(Note: There is a video of the new online coupon system. Watch it first, then request the Using Restaurant Coupons report using the form below the video. It’s yours gratis.)

Topics: Restaurant Coupons | No Comments »

D.I.Y. Restaurant Marketing Research

By Chief Commando | August 7, 2008

We took them to the water.

We wanted to see if they would drink.

The first “beta tester” group of restaurant owners and managers had completed Week 1 of our Instant V.I.P. Clubs program and we were keeping out fingers crossed hoping the aha’s, the revelations, and the excitement that had come out during the conference call would still be there, a few days later.

Will they actually take all the great information and the tools we’ve given them, and the ideas they have come up by following the process — and implement them in their businesses?

You never know what’s going to happen.

It’s a moment of truth in this game.

Our information is worth exactly as much as they will apply it in their business. Full stop. End of story.

Motivation is transient. Entertainment is worthless. The ooh’s and the ahh’s don’t count for anything. Only results do.

The first workbook is all about defining the restaurant marketing target. Who are your customers? What do they want? What else do they spend money on? What are they passionate about in their lives?

Toni, one of our students, did an outstanding job in the virtual “classroom.” Yet she had some questions left. The kind of questions that nobody can answer for her, except… her.

And she did. Check out this note from her:

This morning there was a scheduling mishap and instead of trying to cover the cashier’s shift I took it as an opportunity to do some research. I found out as much as I possibly could about every customer that walked through the door. I recorded answers to the questions I would ask and observations that I made in my notebook that I kept under the register. I wrote down details like ages, how they looked, what they ordered, where they worked, if they used a coupon, marital status, whether they had families, what kind of hot sauces they like (if any), whether they were first timers or not, how they heard about us, who they were with, whether they were in a hurry, if they ordered to go, if they tipped (server thing), rated their enthusiasm and basically made a judgement weather or not they would be good candidates for our V.I.P. club. I encourage everyone to do something like this and keep a daily log of current customer traits. It was very informative and exact.

Amen, sister. You rock!

Now, is there something that Toni did and that you can’t? Nah, don’t think so. If you are too lazy, or too stubborn, or too “above it” to do what Toni just did, you have no right to be mopey about the state of your restaurant business.

Topics: Restaurant Marketing, VIP Clubs | No Comments »