Restaurant Trade Area Research

RTAR is sad to report the demise of `the train station’ restaurant in downtown Woodstock Georgia - the Right Wing Tavern. Regular readers will remember that I featured the RWT when my family used a Groupon there in February of this year  The Groupon `Restaurant’ Experience - Why Pay More? - when I wrote one of the first `negative’ reviews of using the marketing idea of Groupon for restaurants (and coupons in general). Here’s a link of the closing in the local online coverage - http://woodstock.patch.com/articles/oh-no-right-wing-tavern-is-closed - which `blames’ the democrats and liberals now that Obama is in power (a bit tongue in cheek) - while at the facebook page the owner sites the 2008 Great Recession downturn for the restaurants eventual closing.

However, it may go beyond both those reasons - even if both had a part in the closing. Reason being, Downtown Woodstock is THRIVING at the moment, and, over the last 2 years in particular, - with multiple eating places opening in direct competition to RWT - including Canyon’s Burgers (fast casual with beer, wine) , Pure (more funky, tex-mex, drinks, outside atmosphere), and J.Christophers (breakfast, lunch) . Indeed, a dessert place and a `coffee bar’ have also opened and are attracting dollars.

Now, I would hardly blame the Groupon for the RWT closing - but, remember my words after my Groupon experience (and remember, my family was an irregular user within the trade area):

“The effect of Groupon’s ultimately on the sit-down, alcohol available, how about an appetizer or dessert places - such as Right Wing Cafe (yes with a political theme) could be even worse IMO. There, in a location we only use perhaps once a year, - I am SURE that I wouldn’t return without getting the same 15.00 savings (bill was 38 - minus 15 for 23 bucks) (not including tip).

It’s just my opinion, but, it seems unlikely that folks that have stopped goingto hostess seated, appetizer-dessert-alcohol pushed by waitpersons restaurants - but who are indeed enticed by 15.00 savings - will be returning at FULL price. Right?”

So, the fallout of 2008’s new normal is STILL working its way thru the competitive restaurant marketplace - and some foods, and political climates and pricing and marketing - can `do in’ even icons in perfect trade areas.

Our family loves Crawfish - and, whatever happened to Langostino’s? Hot N Juicy Crawfish Restaurant to Open in Orlando - http://www.restaurantnews.com/hot-n-juicy-crawfish-restaurant-to-open-in-orlando/ opening in the insanely hot trade area near the Disney Complex of Entertainment.=============

The expected social media pushback has started - Why I Will Never, Ever Hire A “Social Media Expert” - post gets right to the point about NOT over doing it and at getting a balance. http://www.businessinsider.com/why-i-will-never-ever-hire-a-social-media-expert-2011-5#ixzz1PpH0wUVb – taking an opposite view, the rebranding of Food Trucks - How Social Media Is Fueling the Food Truck Phenomenon - http://mashable.com/2011/06/16/food-trucks-social-media/

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In McDonald’s news - Tampa area McDonald’s are a template for the nation - think cozy and efficient with embedded media penetration - and improved operations once again at the drive thru - (even soundproofed kid areas) http://www2.tbo.com/news/tech/2011/may/18/tampa-mcdonalds-are-a-template-for-the-nation-ar-208053/ - and leave it to McDonald’s to provide this stat - McDonald’s Could Account for Half of May’s Job Growth - http://www.theatlanticwire.com/business/2011/06/how-much-was-mcdonalds-responsible-last-months-job-growth/38489/ - the new normal rolls onward. ———–

But, this analysis suggests that restaurants have been spared some of the impact of the new normal - especially some in particular and some types in particular - Not all is gloomy for restaurants, analysts say - http://www.businessweek.com/ap/financialnews/D9NIHAAO1.htm

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Here’s a link with a detailed look into the Groupon experience of one restaurant owner - and will provide an outline as to what to avoid if you have not made the one time plunge - http://techcrunch.com/2011/06/09/groupon-single-worst-decision/ – as regulars to this blog know - I have been posting about similar experiences from a consumer viewpoint that also would be equally bad for an individual restaurant - The Groupon `Restaurant’ Experience - Why Pay More? - http://restauranttradearearesearch.com/2011/02/23/the-groupon-restaurant-experience-why-pay-more/ and here - http://restauranttradearearesearch.com/2011/05/31/the-restaurant-value-coupon-dilemma/ . IMO, `Groupon’s’ in a Generic sense - would best be used in EXTREMELY targeted localized areas on the fringe of Trade Areas with lower penetration (almost like how the backs of Kroger receipts in the East Cobb area have been for a decade or more).

Wait, it gets even worse - here’s the same viewpoint with even stronger reasons to resist the Groupon type of experience - Why Daily Deals Are Becoming A Raw Deal - http://techcrunch.com/2011/06/03/why-daily-deals-raw-deal/ – IMO, the best `daily deal’ positioning in the restaurant marketplace is Subway’s 3.99 daily combo which changes everyday.

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In other news, Arby’s to be sold - http://www.restaurantnews.com/wendys-arbys-group-announces-definitive-agreement-to-sell-arbys-to-roark-capital-group/ and Burger King finally announces a new menu focus (think healthier, salads-smoothies) and store interior design of updated colors - http://www.miamiherald.com/2011/05/30/2242557/burger-king-goes-for-new-look.html and Dunkin Donuts has added a somewhat complicated User Rewards program - http://www.restaurantnews.com/dunkin-donuts-launches-new-dd-perks-rewards-program/ – that said, it appears to have big rewards for the heaviest of users (who may be considering the upgrades to coffee and other offerings at other FF restaurant brands).

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Sodapalooza is what the billboard sign screams in East Cobb, Georgia - it’s the new 49cents drink promotion at Race Trac http://www.racetrac.com/AwesomeDeals.aspx - a southeastern convenience store chain. Indeed, the competitors price is all of 59cents this summer (Quik Trip) I believe. And, as we all know McDonald’s has had 1.00 any sweet tea (occasionally all drinks too) of any size.

Unbelievably, to me, the reluctance to challenge McDonald’s great positioning continues with few exceptions. In Atlanta - Sonic, Steak and Shake and Chick Fil A - all have a dayparted two for one in the afternoon (do you ride around with others in the afternoon?) non-meal hours. While a reaction, it is somewhat whimpy. And, no other FF’s even seem to `get it’.

Hence, the huge rise in `drinkless’ FF orders (those so-called value combos eventually saved the average consumer nothing or perhaps a quarter and users knew that it had become more of an ordering and operations way of pigeonholeing consumers) — which has even given way to `sandwich only’ orders in the New Normal.

Consumers remember the days when Iced Tea was just coming onto FF menus — and IT WAS ALWAYS CHEAPER — much cheaper. What ever happened to that? Are FF outlets really going to lose money IF they `re-position’ drink prices? What if `any size drink’ was 79cents with a full priced sandwich? Wouldn’t that be easy? Certainly better ideas exist to return the drink to the orders than what is currently being marketed by nearly all FF brands.

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