Restaurant Trade Area Research

Here’s a detailed article about WHY Red Lobsters demographics may be indexed strongly with Black customers - hint: think `menu census’ (a great form of research too) - http://atlantapost.com/2011/04/05/understanding-red-lobsters-popularity-amongst-african-american-diners/

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One way that FF restaurants are defining their `upscaleness’ over the last few years has been `Milkshakes’ (with a capital M) - such as this new premium offering from Chick-Fil-A - Chick-fil-A Whips Up New Banana Pudding Milkshake - http://www.restaurantnews.com/chick-fil-a-whips-up-new-banana-pudding-milkshake/

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Taco Bell has responded to the `fake meat’ rumors that some charge or accept with an open ear - such as here - http://www.thatsfit.com/2011/03/18/do-you-believe-taco-bell-is-real-meat/ - with an advertising response http://www.youtube.com/watch?v=0DeJGN_QfTQ - speaking up for content (sourcing) is VERY important. Good Move.

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Speaking of content - Dunkin’ Donuts Serves Up New Big ‘N Toasty Breakfast Sandwich - http://www.restaurantnews.com/dunkin-donuts-serves-up-new-big-n-toasty-breakfast-sandwich/ - DD continues to make inroads into the ONLY growing daypart segment (really) breakfast. That said, I’ve seen the ads and can’t help but think that drive-thru users (and possibly road eaters) couldn’t help but get YOKEY when biting into the sandwich. (However, they do make the fried egg yoke looked pretty cooked.)

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Thanks for your visit today.

The upscaling of the non-tipping restaurant segment continues - http://www.restaurantnews.com/boston-market-completes-nationwide-upgrades-in-400-restaurants/ - highlights include:

Addition of Dining Room Ambassadors – Guests will notice a higher level of service designed to make the dining experience more pleasurable in this fast-casual concept

MUCH more at the link of the upgrades:

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Oldie but goodie link - Zagat Fast Food Survey Rates 136 Major Dining Chains From Breakfast to Burgers, Dessert to Drive-Thrus - http://www.restaurantnews.com/zagat-fast-food-survey-rates-136-major-dining-chains-from-breakfast-to-burgers-dessert-to-drive-thrus/

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Meanwhile… How Lunchtime Is Turning Into Snack Time  - http://online.wsj.com/article/SB10001424052748703720004575477652910948336.html?mod=googlenews_wsj – smaller portion options to fit snack movement. And, White Castle Inducts Its Most Dedicated Fans Into Cravers Hall of Fame - http://www.restaurantnews.com/white-castle-inducts-its-most-dedicated-fans-into-cravers-hall-of-fame/ - in some cases the super user is priceless. Brand loyalty. And, in UPSCALE locations - perhaps this benefit is worthwhile in today’s new normal of competition - Restaurants Now Realizing That the iPad Makes Life Easier - http://www.switched.com/2011/01/04/restaurants-ipad-makes-life-easier/?icid=main%7Chtmlws-main-w%7Cdl8%7Csec3_lnk2%7C193449

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Some year to year sales numbers - Chick-Fil-A, 2010 up nearly 6% same store - http://www.restaurantnews.com/chick-fil-a-continues-sales-growth-momentum-in-2010/ - Jack-In-The-Box, up 1.1% first quarter compared to year ago - http://www.restaurantnews.com/jack-in-the-box-inc-reports-first-quarter-fy-2011-earnings-updates-guidance-for-fy-2011/

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Thanks for visiting. Dig deeper for much more.

The evidence is starting to pile up about one response to the new normal is that Fast Food brands should enhance the  restaurant experience available - almost regardless of price point - because in large part it is aimed at those `trading down’ from the sit-down and tip waitress at lunch segment - and at the already existing non-tip fast casual (such as a Five Guys).

Examples include Wendy’s new redone Premium Salads priced at around 6.00 - and the large variety of `Angus’ Big Burgers available at most of the major chains now. (Can Buffalo Burgers be far away?) It would also include the upscaling of Milkshakes at Chick-Fil-A and Hardee’s - to the recent bone-in BBQ of Burger King - to the upscaling, at least perception wise, to many McDonald offerings such as the yogurt choices and coffee.

These new positionings, which often include a dash of health perceptions mixed with a sprinkle of indulgence, can be fairly and profitably priced within the fast food price points compared to fast casual and especially when compared to ANY RESTAURANT THAT DEPENDS ON TIPS FOR ITS EMPLOYEES. As today’s customer, in the new normal, is no longer disregarding any `additional charges’ as frivolous.

Indeed, when today’s restaurant using customer sees a Chili’s ad about the Burgers choices (with fries) starting at 5.99 - they know that - even getting water (the continuing trade-down) - that with tax their bill will be pushing 6.50 - which with tip (can you really tip under a dollar in a sit-down environment with table cloths) would be another buck (or two to not look cheap) - making the 5.99 advertised price point, more like 7.50+ and they are still drinking water. (The 1.79 and up prices on drinks at these places do them no help perceptually either). Indeed, throw in the drink, tax, (and now a two dollar tip) and you are talking 10.00 nearly - for the cheapest 5.99 advertised price point.

And, perceptions like that - add up to Fast Food brands having some opportunity for brand extensions with good profit price points. Doing this, while retaining the `value’ and yes - even the `dollarish’ price points too. (Dollarish (things under 1.49) would be a fun positioning.)

Lastly, since the new normal could be here for years and years, expect this trend in Fast Food brands to be a continuing process as brands find profitable brand extensions once thought of as not possible or too out of character for FF. Does this mean `value sized portions’ of something as exotic as `Prime Rib’ - before you say impossible - remember, this is the new normal. Crabcakes anyone?

Here’s some thoughts of a 50 year old multi time a day FF eater - http://www.youtube.com/watch?v=T2H_pEFuSSo - and more about my services is right here www.squidoo.com/tradeareasurveys too.

With second quarter sales off 7% - more and more franchisees are not confident with the new emphasis on sandwiches and grilled chicken - one decades long franchisee even said this: “Roger Eaton and his company don’t give a rat’s ass,” - http://www.businessweek.com/magazine/content/10_34/b4192019553596.htm?chan=magazine+channel_news+-+companies+%2B+industries much more detail at the link.

And KFC isn’t the only big name with continued lower secondquarter sales as Arby’s is once again off 7.4% and Wendy’s is off 1.7% http://www.restaurantnews.com/wendys-arbys-group-reports-2nd-quarter-2010-results/ - that said, Wendy’s/Arby’s plans expansion abroad with duel branded stores - http://www.ajc.com/business/wendys-arbys-to-open-588791.html

Meanwhile, while some chains go overseas for expansion - Chick-Fil-A plans to go into urban USA locations - http://www.ajc.com/business/chick-fil-a-plans-589960.html

And, speaking of GOING into new areas - New food-truck trend rolls into Akron - Vehicles promote fresh, unique fare, pose competition to eateries - http://www.ohio.com/news/top_stories/100353574.html making existing restaurants uneasy.

And, speaking of being uneasy in the restaurant business - Restaurants seek recipe for economic sustenance - So, with the fear of the unknown come new marketing strategies, including lots of social media and some creative pricing packages. Restaurants are also learning the value of truly connecting to the community they call home and making sure their new and regular customers are given top-notch food, delivered with a smile. - http://mddailyrecord.com/2010/08/05/restaurants-seek-recipe-for-economic-sustenance/ the bad news, of course, is that the `new normal’ is quickly becoming the new reality.

More down sales from O’Charley’s too - same-store sales at O’Charley’s company-operated restaurants declined by 7.9 percent - http://www.restaurantnews.com/ocharleys-inc-reports-results-for-the-second-quarter-of-2010/

More about my services at www.squidoo.com/tradeareasurveys

Having `connections’ with customers and people in general in this new normal is important for the restaurant category - and - Folks Restaurant in Woodstock Georgia - like many brands - `needs users’ - and anything that gets them coming to the restaurant is `good business’ (or a sign of desperation?) - so, why not try to cater to those `Bingo’ fanatics.

Another idea in Woodstock was the recent `reservations only’ Father/Daughter Date Night at Chick-Fil-A — `two more restaurants that are `using the works’ - in the new normal.

More links too:

Bojangles’ Gives Big Awards to Top Locations - and the winning location got 10 Grand — cool — http://www.qsrmagazine.com/articles/news/story.phtml?id=11117

Here’s an epic article about McDonald’s effect on the world - Happy meals: Why McDonald’s has been a positive force for change - http://www.independent.co.uk/life-style/food-and-drink/features/happy-meals-why-mcdonalds-has-been-a-positive-force-for-change-1972152.html 

Want to see some recent (June 7th) on the street research with a 50 year old male who by 2 pm had already eaten at two fast food restaurants? — http://www.youtube.com/watch?v=T2H_pEFuSSo - If you want feedback on your brand contact me at 678-467-8650

Well, you certainly know where I stand on listening to customers - but - this is a classic article that takes on KFC for not addressing its own perceptions head on: quoting from the post:

Me, if I were forging brand strategy, I’d defiantly promote my dietary incorrectness. I’d flip the bird at the food police and wave my greasy napkin as a battle flag. Sure beats lying — not only on moral grounds, but on the basis of pure common sense. What could possibly make KFC think that anyone buys their sad little charades? They either have no respect for the crap-eating public or no idea how to search Twitter. Here just the top few of thousands in the same vein:

http://adage.com/article?article_id=144143 – So, how about TRUTH as a brand positioning?

Here’s another KFC post - about its new slogan - the fifth in five years - and one they will stick with they say - Battered KFC Gives Itself Another Spin - http://adage.com/article?article_id=144035

Here’s some big news - Denny’s Inks Deal with AARP - and, with the 20% discount between 4-10 PM - it’s like a dayparting price. Who will be next to go after the over 50 market? http://www.restaurantnews.com/dennys-inks-deal-with-aarp/

A successful chain that hasn’t introduced a new sandwich in TWO decades? — Yepper, Chick-fil-A Heats up Menu with New Spicy Chicken Sandwich - http://www.restaurantnews.com/chick-fil-a-heats-up-menu-with-new-spicy-chicken-sandwich/

The headline on this story is - Have It Whose Way? - At Burger King, management and franchisees are locked in battle over the company’s direction - Seems everything from late night hours to 1.00 double cheeseburgers and more is prompting the public battle. http://online.wsj.com/article/SB10001424052748704869304575109240807702512.html

Thanks for visiting today. Much more on this site - take a look around.

Welcome to Restaurant Trade Area Research - the restaurant blog written by a 30+ year restaurant researcher who has personally  interviewed thousands and thousands of fast food customers. (How’s that for a mouthful?) - Today’s topic, what seems to be the new need - `shooting the works’ to maintain or grow market share in the `new normal’.

Examples include:

Expanded Dayparting Focus - Subway going into the breakfast market is the first to come to mind - Daypart pricing is also notable with `2-4 pm’ reduced beverage costs (Steak & Shake — Sonic) — Weekpart Combo Specials , such as Moe’s Thursday Two for One’s - Subway’s after 5 footlong pricing, etc.

Seasonal dayparting — summers `late night positioning’ has been going on for years (open til 2Am on weekends type of stuff), and, it’s been noted recently that in the casual niche, 12AM or later, was recently claimed in the Atlanta media market by Applebee’s. At Fast Foods, `summer late nights’ is almost a requirement for some (Wendy’s, Taco Bell) but is an opportunity for others too (such as a Krystal’s potential muchie crowd,  or even sandwich niche restaurant).

Outrageous Product - The incredible focus on low price points within advertising (which has muddied the field) has made new product introductions even more important to appeal to the `trier-rejecters’/aware non-users of any fast food brand. One method to get attention is the outrageous product - such as KFC’s Double Chicken Sandwich. And, most recently Burger King’s move into Bone-In Ribs - would be an `unexpected’ example of a `new product’ that should `create new trial’ - especially with good word of mouth - especially during summer. (Perfect `season’ new product introduction.)

Expand Competition Into Other Niches - Recent examples of this include McDonald’s continued focus on beverages such as premium coffee and other choices. Burger Kings new Ribs carves out part of the sit-down market (and the `upscale’ `trade down’) as does it’s Brunch positioning in some markets. The new `upscale’ Milkshakes by Chic-Fil-A, Hardee’s and Zaxby’s –> reach into the `Dairy Queen’/Baskin Robbins niche.

The `Health’ Market - Long heralded as the next sure thing (only problem was that in the 80’s-90’s market was still non-existent) , the `Healthy Fast Food’ market may finally be available - due in large to the already established `Bakery’ niche being taken ALREADY by the female demographic that has turned FROM fast food choices in the last 8 years or so, - to places like Panera Bread or Atlanta Bread Company or others. To me, it seems the natural ones to attack this would be sandwich chains like Quizno’s - Blimpie’s - Subway.

Upgraded Products/Serving Quality - Angus Beef now is an example of offering the `upgraded product at a premium price’ niche. Obviously it also attacks the `fast casual’ growing segment (the stepdown from casual tipping establishments). I’ve already mentioned BK’s Ribs. KFC roasted chicken could be seen by some as an upgrade in health perception.

Selling Branded Products — To me, it is a little self-defeating - BUT - White Castle has frozen product as do many other restaurant chains. To me, I’ve never found these pre-packaged foods to be as appetizing. How about you? Then again, Dunkin Donuts coffee seems logical - and I know that I’d buy a Big Mac Sauce if it was ever offered.

Fancy, Social, E-Mail Marketing Database Building - To me,  working with a stores known customer bases information - and the customer base itself - is VERY attractive too - and is needed to not lose an edge to the competition. That said, some areas seem to have the potential to eventually become overdone and self-defeating (the free food promotion costs - or extreme motivational discounts) and eventually will have it’s `day-come’ due to overuse.

For example, lets say you sign up with a store chain that will provide you a coupon code every time you go to their restaurant trade area — if you signed up with multiple chains you eventually would not wade thru the offerings and IF you did act on one - it would be the one `giving the most savings’. Coupon people are indeed driven by costs - which will drive down your profits and establish a two-tier payment pricing - and confuse the customer base about the real price/value of your products. GPS `coupons’ will not replace friendly smiles, eye contact and good operations. (Within this blog I’ve talked about specific marketing that can be done with your EXISTING customer base via ONE question frequency targeting - or - NO question `menu’- total purchase targeting.)

The `New Marketing’ for the `New Normal’ goes way beyond buying the 25-54 demo slightly focused on one sex - and expecting success. No, the new normal demands running on all cylinders in multiple directions - and catering to a stores unique customer base.

Thanks for reading today - if you check out my sidebar - you may find a category of interest to you. You can also read more about my MarketView research at www.squidoo.com/tradeareasurveys .

I will have a major post in the next couple of days - until then - I’d like to give you some restaurant links I’ve been following lately on my Squidoo Trade Area Site. Yes, you may want to bookmark my Squidoo site too www.squidoo.com/tradeareasurveys as I update the restaurant links often.

Links:Chic-Fil-A — posts 42nd year of sales growth - http://restaurantnews.com/chick-fil-a-marks-42-years-of-annual-sales-growth-in-2009/

Number of U.S. restaurants slipped in fall 2009 - http://www.pizzamarketplace.com/article.php?id=17201 The new normal.

Using Menu Psychology to Entice Diners - http://www.nytimes.com/2009/12/23/dining/23m enus.html?_r=4&pagewanted=1&emc=eta1 I can here the operations directors scoffing right now.

Burger King’s ‘Superfan’ Might Just Be Your Grandma - http://adage.com/article?article_id=141964 Believe it.

Dubai Diners Flock To Eat New ‘Camel Burger’ - http://somalilandpress.com/11568/dubai-diners-flock-to-eat-new-camel-burger/ I’d flock for a Camel Burger, how about you?

Even more on my Squidoo site.
 

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

This is a copy and paste from my blog at http://streetlevelviews.blogspot.com — Check it out.

Wednesday, July 22, 2009

Restaurant Top Of Mind Fast Food Awareness - Atlanta July 4th, 2009

Hello, and welcome back to Street Level Views. As you may be aware, on July 4th I spoke with a number of random people in Piedmont Park in Atlanta. Each of them were asked to name restaurants off the top of their heads and ultimately were also asked to name Fast Food Brands in a top of mind fashion. And, the seven folks in the demonstration taping were a mix of races, ages, and represented both sexes about equally.

Which makes the results even more interesting as they were anything but random. Indeed, 4 of 7 respondents named Chick-fil-A FIRST when mentioning Fast Food brands - with 5 out of seven naming them unaidedly. The other FIRST mentions were Moe’s, Subway and Burger King.

Only four FF restaurants had more than one mention unaidedly McDonald’s (3), Wendy’s (2), Subway (2), and Burger King (2). Other FF brands mentioned unaidedly included 5 Guys Burgers, Taco Bell, Jayson’s Deli, Moe’s, Quizno’s, Checkers, KFC, and Publix Subs.

Commenting on the top of mind mentions —— It is striking that Chick-fil-A `won’ in such a hands down manner (even with such a small sampling). Even more striking is the best `top of mind stories’ told by the respondents involved Chick-fil-A too. One story was told by a under 35 year old woman of she and her friends talking about how they would love to be on the `ad account’ - and - another woman, the heaviest fast food user of the seven - went into GREAT lengths to `show what she appreciates’ about Chick-fil-A. Obviously, the cows, humor and service seem to set Chick-fil-A apart from the everyday FF crowd.

The question is - will that awareness hold up in the first (beta) sample to be gathered citywide over the next month or so - bookmark and return for more information.

And, see the sample interview here http://streetlevelviews.blogspot.com/2009/07/street-level-views-about-restaurants.html and links to the other six interviews on YouTube.

Here’s some recent on the street interviewing I did about restaurants:

http://www.youtube.com/watch?v=EtVziTDuZOY

http://www.youtube.com/watch?v=Bj8ZsJ5JeAg

http://www.youtube.com/watch?v=-v9QqZ9QeCc

http://www.youtube.com/watch?v=zTRO81RR7DA

http://www.youtube.com/watch?v=GJlZ-cOFbqg

Find out more here - http://streetlevelviews.blogspot.com

The above research `featured’ Arby’s, Chick-fil-A and Subway.

Hello, thanks for returning to my Restaurant Trade Area Research (RTAR) website - I’m back and ready to comment on the utterly new marketing situation all businesses are facing during this economic downturn. This blog decided to `wait’ during the last 10 weeks - rather than comment `daily’ on the possibility of financial meltdown and market disruptions. Knowing that you, a franchisee - knew the real business situation better than the commentators on Tv or in-print.

But, seeing now that 10 weeks after the end of the first cash crisis, that we seem to be facing, again, the solvency of the very banking system — it at least seems prudent to update the on-going strategies being employed with marketing and ad dollars - by various fast food, casual, and sit-down restaurants in 2009 – and that strategy - not surprisingly — has one focus — PRICE. (Ad language for `cost’ — the perception of the consumer.)

As you may know, when we left off in Nov. it was about price too - various price points - and now - we have the same only ratcheted up a degree. I can only comment about the local Atlanta media marketing and local store market close to Woodstock, Ga. That said, I’m pretty sure that each is generally reflective of the nation as a whole.

Perhaps most noteworthy and of immediate concern to the competitive marketplace is Quiznos advertising campaign about `reducing prices’ on food. Period. Not, come in for a reduced price combo or similar deal or bounceback coupon value — no - the actual phrase positioning `reducing prices’. Their local couponing has a 2.00 off any regular sub and buy any sub and get a chips and regular drink FREE. Combine the everyday reduced prices with an additional 2.00 coupon — and the price for loyalty and new trial customers - has just been increased.

And, as you know, - for years - Sonic - has offered reduced drink prices during the afternoon. And, as you know, since Chick-Fil-A  (and Hardee’s) started selling quality milkshakes - those that previously sold shakes (especially Dairy Queen and Steak and Shake) - have probably been under some pressure on a signature item. The response - an aggressive coupon campaign by Steak and Shake and not only that, locally, in Woodstock, Ga at least — reduced price shakes from 2-4 in the afternoon. A very good aggressive response and making true dayparting of pricing a strategy that deserves a second look. (Such as reduced coffee pricing after 4 PM.) Not only that, recently, Steak and Shake had a special of those small burgers that are now favorites of Casual Restaurants too - attack on all fronts.

Fortunately, the above examples are the only ones talking about reducing prices (although - O’Charlies has pushed the casual market with the 7.99 price point advertising - instead of the usual 9.99) and, ultimately,  your customer ticket total. But, all the others are doing the same in their own manner. Here’s just a re-cap:

McDonalds - To soften the price INCREASE for the double cheeseburger from the old price of 99cents to 1.19 - the `old’ price of the double cheeseburger Combo for 2.99 is retained. (Only those cheapies will face that 20 cent increase.)

Wendy’s - Pure price positioning - 3conomics — with the focus on 99 cent choices of only Wendy’s quality and variety. (McDonald’s has countered with ads supporting their  3 - 2.99 combos too.)

Arby’s - From 1.99 Chicken Sandwich choices to 3.99 specific combo choices — low price positionings for Arby’s.

Taco Bell — Ads geared to products BELOW 99 cents each.

Checkers - New `99cent’ offerings.

IHOP - All you can eat pancakes.

Zaxby’s - 5.25 (or about) Combo’s.

About the only ones holding to a non price strategy at the moment are the potentially `low  priced’ Krystal (hard to reduce the price on a burger of that size) and `high quality’ brands - such as Chick-Fil-A. And, Burger King - continues to do what the King does best - be edgy.

The RTAR will get back to regular postings, with weekly links, with more opinions, and more updating  of the sidebar (and more) for this webpage - hope you like the changes to come in 2009. I want to suggest looking at the full 2008 postings of merit by  hitting the link in my sidebar review of 2008.

Continue down the page for much more. See you next week.

While I’m not sure of how many markets have the new Arby’s ad - sometimes attention grabbing `humorous’ ads might not be worth it. If you haven’t seen the new ad - two workers out in a field are hungry for lunch; one guy laments he has only 5 bucks; the other says we can go to Arby’s for any of their toasted subs, curly fries, and a drink for 5 bucks (hope the guy has some pocket change for the tax); and his friend, not believing the deal says if that is so `I’ll marry a goat’.

Flash forward to the `friend’ now dressed in a tux sitting next to a goat in full bride headset — while his friend sitting across from him, while gawking at the goat, whispers from behind his Toasted Sub with a wink to his friend that `She’s HOT’. Leaving the viewer wondering about the newlyweds first evening together as the punchline humor.

Verdict - 4.99 combos on a large sandwich at Arby’s good - usage of marginal humor - not so good. Especially after multiple viewings.

Ok, onwards to today’s links — with MUCH emphasis on Drive-thru’s.

QSR Names FF Restaurant With Best Drive-thru

http://www.marketwatch.com/news/story/qsr-magazine-names-americas-best/story.aspx?guid=%7B2EA0E58A-DFBE-48D6-8AA9-0FA581B99F7C%7D&dist=hppr Chick-fil-A is overall winner - most accurate and clearest speakers. Much more in this excellent 2 minute read.

The END of the Drive-Thru?

http://www.qsrmagazine.com/articles/features/120/emissions-1.phtml  Talk about how idling laws in Canada may become important to even your business.

Amputee On Motorized Scooter Banned From Drive-Thru

http://www.mirror.co.uk/news/top-stories/2008/10/07/mcdonald-s-ban-amputee-on-mobility-scooter-from-drive-thru-115875-20782800  Common sense but a fun article.

Is Drive-Thru Nation in Idle?

http://www.nj.com/independentpress/index.ssf/2008/10/lost_in_suburbia_losing_direct.html The continuing `drive’ against drive-thrus — from bank tellers to libraries and post offices - and of course - restaurants.

The Education of the Fast Food Nation

http://media.www.theorion.com/media/storage/paper889/news/2008/10/08/Opinion/Fast-Food.Nation.Needs.Lesson.In.Healthy.Eating-3475751.shtml

That is it for today — much more below too.

Just last month in this post http://restauranttradearearesearch.com/2008/08/02/perfect-demographics-perfect-traffic-counts-closed-restaurant/ I talked about the closing of a Backyard Burgers location at the intersection of Sandy Plains Rd and Hwy 92; and now, sadly - more fast food locations have bitten the dust nearby further `up’ (west) on Hwy 92 nearer to Woodstock.

Both went down about the same time last month - a 15 plus years open KFC; and a Zaxby’s which had been open several years. The KFC was in the midst of many fast food competitors - across the street from McDonald’s and Mrs Winners (Fried Chicken) with Capt’.D’s, Dairy Queen, Burger King and Chick Fil-A within eyesight; in addition to other restaurants within a mile such as Arby’s, Subway, Taco Bell, Wendy’s, Checkers and several sit downs such as Ruby Tuesday and O’Charley’s, Po Folks and several long time non brand restaurant choices. Yes, this was and is a developed area.

But, things change, - the Walmart across from KFC moved 2 miles up the road a few years ago replaced by a 4 day a week furniture wholesaler. The drugstore within the KFC retail pad went empty last month — the same retail pad saw a long standing BBQ location Slopes fold  about a year ago.

Our family used the KFC about once a month; usually for dinner - nearly always thru the drive-thru. Usually for the `dinners’ for 2.99-3.99 - buy three of those and you really felt like you got a sackful. Somehow, the drive-thru never backed up.

So, now, the nearest KFC is about 3.7 miles away, (this was about 2.1) and on our way back from Atlanta up Hwy 5. So, instead of using that one twice in last 5 years — I’ll probably bump into the once every six month category - and also eat at  Mrs Winners more often. Reverse attrition to the survivors.

I wonder if the KFC on Canton Rd will `market’ to the closed KFC’s trade area - I wonder if they have done any trade area surveys - to know that info?

The Zaxby’s closing was equally as surprising and it also was a place our family went to about once every 6 week or so. It was located about 3 miles from our home and we used it for evening eat-in meals (you only deal with Zaxby’s drive thru once) - it had good quality. It was NOT located in a highly concentrated fast food strip but did have local competitors. Indeed, a new chain Kayson’s, opened and shortly after the Zaxby’s was history.

The point of this posting is that the competitive environment is tough and getting tougher. Knowing your local trade area via real marketing research is not a luxury anymore. Indeed, if you do your whole market with a MarketView — you may know which `available’ fast food locations fit your market development plan without overlapping your own existing stores penetration. You will be able to do your own `attrition’ estimates based on trade areas.

Please visit www.squidoo.com/tradeareasurveys for more information about how I can help your marketing decisions.

Today’s Restaurant Links

Krystal’s Offers Up `Sonic-like’ Positioning

http://www.prweb.com/releases/2008/09/prweb1289284.htm  Is this `the idea’ that could make Krystal a player?

`Local Restaurant Dishes Out Manners’

http://www.kcsg.com/news/regional/28032164.html  `The Cell-Phone’ reminder. Quick read. Find out who is using `the reminder’.

`California Moves Closer To NYC-Like Menu Law’

http://www.desertdispatch.com/opinion/state_4250___article.html/mandate_menu.html 

`Fast Food Outlaws’

http://www.smh.com.au/news/world/fastfood-outlaws/2008/09/06/1220121599393.html  A less than flattering look at the USA from our friends down-under.

`Changing Lifestyles and Rising Incomes To Affect Restaurant Sales’

http://www.prweb.com/releases/restaurants_pizza/fast_foods_dining/prweb1302024.htm

The above story is about the GLOBAL MARKET and not the changing lifestyles here in America (less eating out, trading down). Nevertheless an in-depth viewpoint to read.

Last year, I personally interviewed several thousand fast food customers (in-store and drive-thru) in a variety of fast food brands for Trade Area Research purposes. (Do you need trade research before expanding your market?) This was normal for me as I have  personally interviewed thousands of fast food customers for dozens of years. And, as you might know, certain questions are nearly standard on questionnaires trying to understand customer behaviour - such as the fast food restaurant that the customer uses `most often’.

In the 1980’s and even into the late 1990’s - when adults answered that question for me — when the answer was McDonald’s - they would immediately offer a `reason’, in an apologetic tone, which invariably was `the kids’. That is not to say that I didn’t hear `they are everywhere’ and `they are cheap’ on occasion. Nevertheless, the interesting thing was that `other brands’ such as Wendy’s or Arby’s or Chick-Fil-A  or others (such as sandwich chains Subway) - most often users ALMOST NEVER offered up `embarrassing’ reasons for their usage of a particular brand most. Only McDonald’s. It was almost a case of doing `marketing’ too well.

Then, McDonald’s focused less on kids and more on product and product quality. I began to hear folks say that they liked a `particular new product’ at McDonald’s that they went for `most often’. Kids, as a reason, was definitely fading quickly (I informed my clients who at first seemed surprised in the early 2000’s — it was the kind of information that only came from literally being on the ground for multiple brands for decades) - the return of McDonald’s was approaching.

The moral - If the biggest can change a negative perception — other brands, most of which have neutral images, can also build a positive one - like McDonald’s has done.

Today’s Restaurant Links

“People are requesting kids premiums that are more socially responsible,”

http://www.ajc.com/business/content/business/stories/2008/08/16/restaurant_toys_educational.html Wendy’s and Chick-Fil-A jump on `Educational’ kids toys. Strong feedback. Three minute read.

Individual Responsibility And Its Enemies

http://www.mtexpress.com/index2.php?ID=2005122089  Bringing ethics into the fast food discussion with force. Shows how `choices’ and having a restaurant business are related. Three minute read.

Parking Mad At McDonald’s

http://icwestlothian.icnetwork.co.uk/courier/news/tm_headline=parking-mad-at-fast-food-chain&method=full&objectid=21526230&siteid=92284-name_page.html After the positive McDonald’s opinion above - here is an example of not respecting the customer. Probably.

Arby’s Expands Savings Potential With Cellfire Mobile Coupons

http://money.cnn.com/news/newsfeeds/articles/prnewswire/200808130900PR_NEWS_USPR_____AQW047.htm Here’s a new coupon niche.

Are Restaurant Stocks A BUY?

http://www.chicagotribune.com/business/yourmoney/chi-ym-restaurants-0817-cpaug17,0,4787885.story Article says yes if you have a longer time horizon of 2-3 years; while detailing how over stocked the trade areas are with restaurants. Predicts store closings. Four minute read.

Many Many more - current links below. Bookmark and return please. Leave a comment if you wish.