Restaurant Trade Area Research

Nothing like being a bit late to the party - or - making the move while a 5.01 Combo advertising campaign is going onward - but Arby’s has finally moved to match the direct FF competition. Seems the shift away from advertising specific products and tastes continues.

Also seen lately is Capt. D’s once again positioning their food and prices compared to Red Lobster - this time showing a party of two that they could have fed a party of four AND gotten 15.00 back. The tradedown customer is a legit positioning for sure for `dinner’ FF restaurants.

Finally, some other restaurant links:

Hundreds line up to apply for a job at In-N-Out Burger - http://www.ksl.com/?nid=148&sid=8366210

Study: Consumers Prefer E-mail Interaction to Social Media - http://blog.sellsiusrealestate.com/marketing-tips/study-consumers-prefer-e-mail-interaction-to-social-media/2009/10/16/

As I’ve mentioned in the last few posts - the customer frequency of your customer base is the number one attribute of concern to your fast food restaurant. And, if you want your customer base to `listen’ to your promotions - perhaps it is time to treat them like a `listener’ to your channel/brand. One that they can be `loyal’ to (as I mentioned in the last post) - one they are connected with - involved with.

Indeed, it might be time in this new era of the Great Recession - to use one of the old standards of giveaways that radio used for decades to `maintain’ and grow listenership - and that is — give away LOCAL MONEY. Literally at the store level. To `listeners’ (customers) who followed the `promotion’ for entry.

So, for `drink-only, drive-thru’ customers - that meant using `their’ Drink Only `clubcard’ (which had a discount for drinks two and three) twice more for a chance at entry in the `monthly customer loyalty drawing’. Other folks would be turning in their `nite-owl’ cards with a similar idea to forming a (sub) brand loyalty - or a breakfast club.

Likewise, operators need to reach out to other - mainstream frequency programs - and use them in the same manner; (such as combo club, sandwich club, dessert club, or all milkshake purchases today get entry, etc.) - all for a chance to enter the LOCAL `money giveaway’. Indeed, the chance to `win’ 100 or 200 bucks - EVERY month - will stay in the customers mind.

Winners will be `announced’ on the outside reader board (giving customers a reason to read it at other times too) and inside too. The drawing will be LIVE in the store - creating an event. The winner will be posted on a winners board for all to see. JOE SMITH - 200 DOLLAR WINNER - COMBO CLUB CUSTOMER.

In the meantime, the `entries’ (the club cards with E-Mail addresses or phone numbers/addresses) will provide you with a usable custom marketing base for your selected marketing efforts. For your new loyal `audience’.

My research at fast food restaurants has shown that it takes a `certain’ level - generally - for customers to say `I use this restaurant/brand the MOST’. And, even in the new normal of the Great Recession, that level is around once a week usage. Only about 1 in 5 customers don’t offer a FF restaurant they use most often when asked. A loyalty - often felt with justification and pride almost. “they are the friendliest here” “they know me here” “this is super convenient for me”.

Sometimes, operators need to literally `look’ for ways to develop that special relationship with their customer base. And, once again, ways exist around the margin to create that `special user’ - to develop a loyalty. And, here’s just one example (I have more) - let’s say your restaurant is one of those that likes to advertise or position later summer hours - how about a special `bounceback loyalty card’ that is ONLY given to customers AFTER 10 and for use ONLY after 10? The night-owl club. 20% all summer for those `special folks’ who visit after ten.

Occupying that special place for customers - generating loyalty - almost a must in today’s competitive environment.

Restaurant Links for today:

Wingstop Reaches 25 Consecutive Quarters of Positive Comp Sales - http://www.reuters.com/article/pressRelease/idUS111102+12-Oct-2009+BW20091012

Darden net income up, sales down in 1Q -http://orlando.bizjournals.com/orlando/stories/2009/09/28/daily24.html Including Red Lobster off by nearly 8%.

Food Fight: Franchisees Caught in the Middle - http://online.wsj.com/article/SB125492481356270841.html Important read of three minutes.

UPDATE 1-Ruby Tuesday posts higher profit - http://www.reuters.com/article/rbssConsumerGoodsAndRetailNews/idUSN0739123320091007 However, sales were off 3%.

Sales meetings at YOUR store? It’s working for Panera Bread
http://www.nrn.com/landingPage.aspxmenu_id=1416&coll_id=554&id=374238#ixzz0Tp32Jvc2

Recently, my daughter related to me how a national FF restaurant was doing a `bounceback’ (stuffed without mention into a drive-thru bag) `free combo’ promotion. It was either buy 4 more and the fifth one was free or buy 5 more and the 6th was free. You had until the end of the year (so about twice a month to get the freebee).

Now, while I applaud the effort - since the frequency of your CURRENT customer base is most important customer attribute in the `new normal’ of the Great Recession - it falls WAY short of real motivation or of doing what it seeks to do - which is to increase frequency or market share.

Why not?

Because it simply isn’t motivating. To the VAST majority of the customer base as it has too high a threshold for compliance. Additionally, it gives away food for free to those who probably don’t even need a motivation to use your restaurant - your weekly or more often user.

Indeed, the next level of usage - those that use your restaurant once every two to three weeks (which can be a large movable segment) - are generally those who do NOT use your brand most often - for whatever reason (perception of high cost, not as convenient, service issues) and are indeed - UNLIKELY to increase their usage pattern over 2 - 3 months - a long time - for the special deal. We don’t even need to mention the once a month user or less often user — which is the vast majority of the customers of your customer base.

So, what should have been done?

Well, first, if the FF chain really wanted to bring a discount on their combo’s to certain folks over the next 5 visits within a certain time frame — give it to them EACH VISIT. Meaning, the next 5 visits before the new year when you buy a combo it’s 20% off. Saving money EACH time - can address high cost perception problems - and be motivating EACH time.

But, even that is NOT what I would recommend - as the timeframe is too long and the purchase requirement too big. So, obviously, I’m suggesting fewer purchases in a smaller timeframe - at a targeted customer (which you determine by asking your customer ONE question at the time of purchase).

To find out which question - to which type of customer - you need my services. 678-467-8650; ask for Rick.

First, let it be said that my usage of nearly ALL of the restaurants has already assumed the `new normal’ of the Great Recession. Regardless of what cheerleading the media may be doing about the economy - most folks are now cautious on discretionary spending - of which, restaurant visits - even to a degree Fast Food restaurant visits - has been impacted. 

 In alphabetical order:

Arby’s - I `responded’ to the ads for the `Roast Burger’ earlier in the year and was not impressed. I refused to respond to the Marry a Goat `humor’  ad campaign and somewhat like the recent 5.01 combo or pricing (the one cent being for Quality).  That said, generally, I perceive that Arby’s as expensive without having coupons from the coupon mail drop a few times a year. Additionally, they  `streamlined’ their `fries’ - dropping my favorite the Homestyle. How can they NOT promote the Jamoca Shake?

Atlanta Bread Company (ABC) - Remodeled nicely. Upgraded to real plates and silverware. Messy to clean up. Can be crowded and slow service. Female favorite. Good soups and combo prices. Mellow atmosphere.

Burger Inn - Local  legend - all fresh cooked. Great breakfast customer base. Friendly people; newspapers available often. Excellent onion rings. Beefy hamburgers. Male favorite.

Burger King - I like the current billboard promotion about the Double Cheeseburger for a buck, real value - but - haven’t gotten it.  I have ordered the Mini burgers more than once however and view that as an excellent addition. Amazingly, the Woodstock BK got rid of Real Sweet Tea years ago (my assumption is that is still the case) and thereby nearly ended my usage — I can’t stand the fake sweet tea out of a machine. Operations should be aware that changing ICONic drinks can have a big effect. — Finally, where is the KING?

Capt. D’s - Perhaps my favorite FF in Woodstock. Quality, Quick, and Quantity with good value pricing. Covers all reasonable price points including lunch specials and on-going `specialities’ that have all prices. Excellent choice of sides. Funny ads earlier in the year comparing to Red Lobster pricing. Friendly greeting and thanking when exiting. Good inside music.

Checkers - Still a viable concept (double drive thru) - chicken wings were a good addition earlier in year - somehow it fits. Catchy phrase “you gotta eat” recognizable for smaller chain levels of advertising. Covers all price points well with a good mix of products. The Woodstock store does Sunday Pricing - good idea - hasn’t ever motivated me for their `down sized’ versions. Could probably `play-up’ the FUN theme a little bit more.

Chick-Fil-A - Woodstock’s Chick-Fil-A is amazingly busy. Overwhelmingly busy whenever they do a promotion like 2-1 for a chicken sandwich or free food giveaway. Excellent quick service regardless of how long the lines are - especially at the drive-thru. (However, I’ve detected a time or two a usage of `workers in India’ taking my orders — I’m not kidding - and, in this time of underemployment in America - that is NOT right to save a few cents that way.) Real Milk Shakes were genius. Consistent quality. Friendly employees. Clean. ————— All that said, the Woodstock inside service in the sit-down area can be horrid and when is Chick-Fil-A gonna get some normal fries? Also, one takes a chance when getting the baked potato.

Dairy Queen -  The standard in Ice Cream desserts from the drive-thru. Haven’t used but really like the new pricing structure in ads 2/3 3/4 4/5.00 - interesting approach. Unfortunately, for me, the food hasn’t broke thru.

Dunkin Donuts - Right on the Strip - I’ve never used location. Certainly they can advertise donuts and donut prices more.  (IF I knew a quick Donut sweet was 99 cents for example - it would come to mind for `dessert’ or breakfast purchase more often. Never seen a place less concerned with establishing a price point understanding. Just how much does a dozen donuts cost?)

Firehouse Subs - Expensive but Excellent. Can be slow. Friendly employees. TV’s to watch. Good real sweet tea. Small, can be crowded.

Five Guys Hamburgers - Tangential to Woodstock in Sandy Plains area — good operation - waiting for a Woodstock Location (several good places available perhaps too).

IHOP - Expensive, right? What specials?

KFC - Closed but not forgotten. Also was one, like BK, to drop sweet tea for a time.

Krystal’s - Krystal `fix’ a must a few times a year. (Canton Road.) Ad’s featuring Crispy Onions on burger looks very compelling. Wi-Fi add - good idea.

McDonald’s - Woodstocks unit re-designs and updates the interiour often - which is nice. Clean. Service can range from excellent to very poor (weekends). Can often find an AJC or USA today in newspaper bin. Separate kids area - thumbs up. Fries can vary in quality. Best FF fish sandwich.

New China Buffet - Lunch value leader. Good quality food. Friendly employees. Priced by the pound to go. Widest variety of food.

O’Charlies - Stopped going shortly after changed menu restricting Prime Rib to Sundays only.

Panda Express - Have never used. Pass by back of lot 3 times a week on way to Walmart.

Po Folks - AKA Folks —> Expesive for what you get.

Ruby Tuesday’s — How could they get rid of German Potato Salad? (pet peeve). Good miniburgers and platter pricing. Easy to split orders. Great salad bar still.

Sonic - I really like their ad’s inside the car with the main guy and his friend and the main guy and his wife. Classic. Best onion rings in Woodstock at FF. To me, tasteless burgers. Fun to use. Daypart pricing on drinks in the afternoon. Fun music playing.

Steak And Shake -  Best Milkshake in Woodstock. Can be very expensive without coupons and very reasonable with coupons. Great variety of sides. Great music inside.

Subway - Good with pricing with coupons. Good quality. Can be SLOW service. GOOD real sweet tea. Fresh. Daily specials a good way to address pricing. Excellent variety of sandwiches.

Taco Bell - Good cheap price positioning. Good Chalupa’s. Good real sweet tea. Good service speed. Good quality overall.

Wendy’s - Huge variety in quality - excellent one time - poorish the next. What the heck happened to the fries - almost tasteless compared to yesteryear. I’m told good salads. Expensiveish compared to McD’s. Baked potato good price/quality.

Thanks for reading - feel free to comment.

Here’s some links also:

KFC Closes Its Doors to Fight Hunger - http://www.slashfood.com/2009/09/30/kfc-closes-its-doors-to-fight-hunger/?icid=main|htmlws-main|dl5|link6|http%3A%2F%2Fwww.slashfood.com%2F2009%2F09%2F30%2Fkfc-closes-its-doors-to-fight-hunger%2F Community involvemet matters - look at the results of the survey on this page too.

A Real Whopper? NASCAR’s Stewart to take live polygraph test in ad  - http://www.walletpop.com/blog/2009/09/30/a-real-whopper-nascars-stewart-to-take-live-polygraph-test-in//?icid=main|htmlws-main|dl1|link5|http%3A%2F%2Fwww.walletpop.com%2Fblog%2F2009%2F09%2F30%2Fa-real-whopper-nascars-stewart-to-take-live-polygraph-test-in%2F%2F BK, attention grabber again.

Eat, drink, and spend money: Restaurants ply diners with cheap booze - http://www.dailyfinance.com/2009/09/29/eat-drink-and-spend-money-restaurants-ply-diners-with-cheap-b/#continued?icid=main|htmlws-main|dl3|link3|http%3A%2F%2Fwww.dailyfinance.com%2F2009%2F09%2F29%2Feat-drink-and-spend-money-restaurants-ply-diners-with-cheap-b%2F%23continued