Restaurant Trade Area Research

I had seen the billboards but had somehow missed any TV ads for the new Wendy’s W Burger. So, when I eventually did see the TV and it showed the `special sauce’ - my mind instantly went off as a lover of the Big Mac nearly 50 years. When aware of that fact - which I did not pick up from the billboards - in only days I stopped to try it.

Now, interestingly, only days before I had paid 3.91 including Tax for a Wendy’s single at drive thru - it having been since the `improvement’ since I had tasted the new offering. And, the single was `upscaled’ in my opinion - but, in all honesty - 3.91 is a stretch for the product. So, with that in my mind - I went IN this time and ordered the W (making it a combo) for only a little over a buck more than the Single alone.

I was immediately impressed with the sandwich and LOVED the `positioning between the Big Mac and the Whopper’ (even moreso if any BK’s still have the `King’ - their version of the BM) — LOVED the positioning. Indeed, my mind thought, WHY  are they not positioning it that way too? Indeed, the sandwich HASN’T what McDonald’s I’m sure would love to be able to dump - the extra slice of bread between the two patties; thereby giving lots of meat ratio in every bite in comparison.

Yet, the sandwich was uniquely targeted at the whopper too - with the larger lettuce piece(s) and tomato. And, at that time I thought that McDonald’s better have some concern about this sandwich pulling from it’s very core oldtime base customer. All in all - I was impressed.

My second time was nearly as good as the first and was only two days later- but, I got this one to go, with no sides or drinks - paid less than before - had a better sandwich value in my mind than the Single OR Big Mac - but realized that for WENDY’s the tradedown would have to be a hit to the bottom line IMO; especially in comparison to the probable profit margin on the Single.

Then, weeks later, I went inside for another combo while a unit was having operation problems (At Trickum In Woodstock, two Saturday’s ago) - the manager on duty was yelling loudly at the crew about being prepared in advance. It startled the folks in line it was so loud. I hoped no one would walk off the job as the place seemed understaffed and the wait was already mounting. However, the real letdown was upon opening the W - gone were the lettuce and tomato - (I had asked for some extra sauce on it and it was swimming in it) - one little slice of onion, NOTHING else. It was a total turn off and problems were only mounting at the line and counter so I simply ate it.

Interestingly, I said to the counter girl - `how much would it cost if someone asked for the sauce on a Single’ - she said it would be FREE as all toppings are free. For some reason the answer surprised me - could some just as easily ask for Big Mac sauce on a dollar hamburger? Or, the Wendy’s 99cent offerings?

So, I haven’t been back - it’s been a few weeks and probably a bit longer than normal for my Wendy’s visits (prior to W usually a single combo): and as you can see from the link - others are not so impressed with Wendy’s either as in this recent article saying it would http://www.dailyfinance.com/2012/01/12/why-wendys-will-never-be-great-again/?icid=maing-grid10%7Chtmlws-main-bb%7Cdl3%7Csec1_lnk3%26pLid%3D127010 never be great again.

I wouldn’t go that far - but - the positioning of the W could have been structured  a lot better to attract actual new customers from their main competitors IMO. Heck, SELL the sauce in the store in jars - like Big Boy.

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These Two Guys Had The Same Impression As Me On First Tasting

One of the ideas that I’ve personally stressed over the years to clients is to look at their customer base in two manners, trade area and customer frequency segments (heavy users, etc.). And, one of those categories is the VERY occasional user - especially customers that either live in the trade area or frequently use other retail nearbyand therefore pass by said FF brand often. These aware non users (lets say haven’t been to the restaurant in over a year or so) often were users at a higher frequency `back in the day’ (or may have fallen off the usage chart since the new normal). Some FF brands may even consider this market segment to be in the trier-rejector category; often seeing no reason to even market to them.

(Which is silly. Getting those early in life visits to RE-visit is perhaps JUST as easy as getting REAL new users.)

I bring all this up to clarify what my usage of these restaurant brands were before a `re-introductionary’ visit recently (for blogging purposes and for a rotation of tastes, a phrase often heard in FF customer research, especially with male customers). Anyway, here’s a review of a recent visit to Schlotzsky’s,  and Krystal’s.

(These visits happened in summer 2011.)

The Krystal’s my daughter and I visited for a weekday lunch (during her summer teacher break) was located on Canton Rd. (Marietta) - something I drive by anyday I go inside the perimeter or even down to a near `farmers market’ type location further `down’ (south) on Canton. Despite going past the restaurant several hundred times at least since my last visit ,this was our/my first visit inside in several years;(and perhaps we had used the drive thru once in that time period). All this low frequency despite loving the mouthfeel of the Krystal Steamed Burger for decades now. LOW frequency does not mean rejection of brand something FF marketers should remember.

First, upon entry, the Reader Board seemed VERY confusing to look at, and was very strange in that NO combo’s were priced at the 3.00 dollar(s) level at all. Indeed, it was hard to even find the prices for ANY individual products, and they only appeared shuffled over to the side and corner last read (lower right for me).

In fact, after consideration, the combo meals almost seemed designed for parties of two (which isn’t necessarily a bad idea) almost — I’m speaking of combos with 4 and 5 hamburgers being featured.

I saw the Angus Offerings - but internally I think of only the key signature product, the Krystal.(Back of mind thinks, steamed angus?)

We entered about 11:35 AM or so, with the counter having no customers and the order taker cleaning or straightening the front lobbyish area. She gave a nice greeting saying it would be a moment and then apologized again for the 10 second delay, if that, when she was at the register. She was friendly when we told her we needed to look the menu over, and that it had been a bit of time since our last visit.

Eventually, I got 2 Cheese Krystals, fries, and a sweet tea. (Certainly, there should be a combo for this, right? But wasn’t.) - And, my daughter got a sampler of corn dog, Chile dog, mini chicken and Krystal (I think) - this came in a combo with fries and a drink. After paying @12 bucks total, we were given the `number flag’ that have become famous at the `fast casual’ segment - signifying that our food is cooked fresh (or fresher) and that `service’ is being given as we no longer have to `lobby wait’ as customers did in the `old’ pre-new normal days of commerce.

We entered the carpeted eating area - which consisted of 6 or so parties, including at least one person using the free trendy `fast casual mandatory’ Wi-fi service offered. We waited under 3 minutes for our meal delivery.

Which turned out to be wrong (daughters order, not the sampler mix ordered). She kept the right stuff and waited for I believe a chili dog to arrive a minute or two later.

We began eating.

We both thought the fries were VERY good - meaty, yet crispy and hot. Restaurant quality. All the `junk’ food for both of us was satisfying with a great remembering of `the tastes of Krystals’ for myself. My sweet tea was very good also.

The ambiance was okay and had fun images/pictures on the wall, mainly depicting a younger set of folks than was represented in the restaurant ultimately. (Surprisingly, the customer mix was nearly 50/50 sex, white/black race mix, parties of two/one about equal, strong majority over 35). I liked the music although the format now escapes me.

VERDICT - A bit high priced for the products offered IMO - causing a slight value perception problem, especially considering `old’ perceptions of pricing would be of the `cheaper days’ and cheap  Bag of Krystal’s promotions. However, the price was not totally out of line or a usage killer. 

Indeed, the pricing, for the  service of table food delivery, and wi-fi, - is NOT out of line. That said, my perception of a direct competitor of Krystal would be Checkers, not fast casual. (And, IMO, Checkers offers much more value perception.) Certainly, the ambiance isn’t of the level of an Atlanta Bread Company, or even a Boston Market or Zaxby’s, or most of the re-done McDonald’s interiors. And, the fast casuals simply have a higher quality perception with their food and health levels than any of the FF’s (except for Subway IMO, and now, perhaps, with Wendy’s regaining it a bit).

So, would the `new again’ visit be enough to have me stop for a lunch on the way to the farmers market now for an inside meal, or, for breakfast on the way to I-75? (Wrong side of street for easy evening access.)

Not really for me. A low end wi-fi with a non female ambiance FF restaurant, even with great mouthfeel, trying to be a fast casual restaurant - isn’t quite compelling enough. (It’s now been 4 months and I haven’t returned or used the drive-thru.) That said, perhaps a re-directed effort in a couple of marketing strategies might have an effect (such as a 2 Krystal combo?).

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The Schlotzsky’s we visited was in Woodstock on Highway 92 across from Home Depot. That was yesterday about 10 til noon - a weekday. It had been at least two years or more since we had been to this location. When this location opened, we used it as much as once a month for a couple of years. Back then, the store had some operation problems, order problems, even cost of order problems - with our orders - a number of times.

Upon entry, we immediately notice the interior changes, NO order window to monitor to pick up ones order (a definite improvement) and the complete removing of the drink/soup service station from the order/lobby area. Wow. Much better.

The wood furniture, tables and chairs, appears to be `darker’ and more upscale than before too. Moved also is the salad area with pre-made salads (no longer offering potato salads and other things).

The menu board is simpler than Krystal’s for sure and easy to understand. The prices are very consistant with a premium sandwich location. Combo’s are clearly marked.

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That’s how far this post got a few months ago. I have not returned to Schlotzskys either.

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The blogging is going to re-start soon. Thanks for your patience.

Over the last thirty plus years that I’ve been involved in restaurant research - I’ve occasionally been associated with fast food brands that REALLY believed in `couponing’. So much so that the `regulars’ - those that used the chain once or even twice a week - could pretty much count on not paying full price if they were flexible in eating - before the next `coupon drop’ - would once again give them the lowest price on a product. For them, this coupon price became the REAL price - they avoided going when couponless - why should they?

In addition to giving the regulars a lower price point - eroding the real profit center of any restaurant (frequent users) - eventually, and BECAUSE OF BEING UBIQUITOUS - the coupons also didn’t have appeal to the non-users (after-all they had thrown them out dozens and dozens of times already) - the very NEW users the coupon was trying to attract.

Oh sure, the coupons did `move up’ the visit of the irregular users - a few of them - after all, most of them simply `aren’t that into’ your chain - or they would be regulars - so, they often would be using just because of ads and not real coupons. After all, you `supported’ those coupons, any marketing efforts, with other media, usually expensive TV or billboard on occasion.

So, along comes the new normal - set in motion by the near financial collapse of the very structure of the credit system itself in 2008. Followed by the `re-adjustments’ by a huge portion of America’s population - which also included `eating out’ - which suddenly became VERY `discretionary income’ oriented for many individuals and households. (Remember, all income levels saw their perception of their personal and household wealth fall or drop.)

`Nice restaurants’ - the ones with a waitperson for your table and a hostess to show you where to sit - were the first to feel the pressure; hence the rise of the Fast Casual Segment without tipping. A tradedown without giving up too much quality - and with an element of `speed’ that was lacking in the `tipping locations’.

Obviously, the old Fern bars - now family dining places such as TGIF, Applebee’s, O’Charley’s  and others had to respond - and they did largely by advertising WAY more than those `fast casuals’ could afford to - by YELLING the `value’ prices they were now having in their restaurants. IF one were to believe the ads, one could eat at these places for 7 or 8 bucks, even less sometimes.

But, customers, especially today’s new normal customers, know that is not the case - with drink and with tip - even with getting the specials - you were over the 10 bucks a head - and that was a low end number. Avoid the special and you were rapidly approaching 15.00 - not a desirable price in the new normal.

Indeed, SO MUCH SO it was a forbidden price that suddenly — REAL RESTAURANTS - with similar price points - such as BBQ places and `Full Service’ restaurants (that used to take reservations, or do still when needed) felt the need to attract customers - knowing the days of 12.00 plus for frequent eating out was simply not a real business plan in most areas of the country and most trade areas.

Along, came Groupon. And, yes, I had been seeing them and not using any. Then my daughter asked if we wanted to buy Groupon’s on two separate days recently (in January) - which we had her do. One was an 8.00 off coupon at a BBQ place in Woodstock, Ga. called Bub-Ba Q, the other a 15.00 off (25.00 coupon bought for 10) for The Right Wing Cafe, once again in Woodstock (downtown this time).

What was `nice’ about both Groupon’s was they didn’t `require’ purchases - the old - you MUST by drinks etc. It gave the users, us, the feeling of more control and ultimate savings possible.

Now, as a user with a frequency of perhaps - once every 12 weeks or so to Bub-Ba-Q’s — IF they run that special more often than that - I will never pay full price again most likely. INDEED, I MIGHT EVEN WAIT FOR IT - and reduce my frequency by doing so!

And, really - was it really the fact that paying 23 dollars for three of us including tip - instead of 31 that brought us in? Yes, but, now, I don’t want to pay 31 anytime in less than the next three months for sure. More importantly, did the enticement of spending 23 bring in NEW users who were TOTALLY avoiding BBQ due to it’s pricyness at 31 dollars for three?

Do you actually think they will return at full price?

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?

Oh, and here’s an article that basically confirms my above experiences - http://www.cnbc.com/id/41666618 - CEO Blog: Daily Deal Sites Don’t Want Loyal Customers (for Businesses) - (here is a story tease):

It’s worth thinking back about 2010 — what fast food ads do you remember? (I wrote this in late Jan.)

For me, Pizza came to mind first; from the 10 Dollar  price point positioning of Pizza Hut (which offered value and an immediate clarification on pricing, always a nebulous weak point for the Pizza category) to the Domino’s ads about `sending in a picture of your pizza’ and real pizza in ads from now on with no special effects (a reaching out to be more real to people - in essence just what that Undercover Boss series does).

Yes, that funny ad with those Valley Girl type secretaries eating Hardee’s Fresh Chicken Fingers comes to mind still too; and, Wendy’s Sea Salt Fries, but that was recent. Okay, I still have a memory or two of McDonald’s different `Wraps’ type offerings, Arby’s 1.00 Menu - and Subway now offering Breakfast (all three of which induced not one actionby myself until recently trying Arby’s Buck Items). Nearly all the rest is a wash. Money swept under the bridge of TV Fast Food Advertising.

Zaxby’s is simply that easy to whistle same music theme over and over and the folksy endorsement by small celebrities - IHOP is endlessly pushing slightly expensive breakfasts IMO - all the Casual Restaurants such as Friday’s are endlessly pushing the under 10.00 price point (and ignoring that I will be paying a tip beyond any price point that EXcludes a drink to begin with) (not real) - and, where has the Burger KING went anyway? Price is also what I remember about Capt. D’s ads - and Steak and Shake - while price AND size is what I remember about Taco Bell. (As I go mentally thru my local Woodstock Ga. Fast Food Market.)

My guess is that some marketing departments are patting themselves on the back - they have gotten the point thru to a weary America that `eating out’ can fit into a reduced `frills’ budget diet the new normal has put America onto.

But, PRICE may be less compelling - especially emotionally to a consumer - than the reward of trying a new product offering that sounds especially good; one that you may be excited to tell a friend about. And, less compelling than trying to directly talk to consumers like the Pizza category did in 2010. IMO.

So, what would I do if it were MY ad dollar?

I’d want to stand out.

For example, to `reach the consumer’ would 4 thirty second ads bunched with a block of perhaps 4 minutes of similar ads each time - sound like a way to stand out — OR — WOULD A TWO MINUTE `SHOWCASE’ AD? —————– Heck, even 24 - Five second logos might have more impact than the standard forgettable 30 second ad a week into a new ad flight.

IMO, with `Showcase’ Ads - Brands can address all the marketing categories with 3 or 4 variations (a strategy not often used) - first and foremost, the `frequency-rejecter’ - that is the core population base that is aware of your brand, has used it in the past - but now, it has been so long, as to be a `trier-rejector’ (at least to YOU the owner of the brand) of the brand - having replaced it with other choices.

IMO, many of these people can be lured back - and many fall into the influenced by advertising campaigns motif - that ad agencies have long relied upon for improvement of sales during sales campaigns. IMO, they could be targeted MUCH more via a Showcase ad.

After all, REGULAR users are JUST that - and are UNLIKELY to be significantly changing their Frequency of Usage over any term; other than to bump up the next visit interval by a few days, perhaps. Much more effective ways exist to market to your existing customer base than TV mass advertising.

Of course, the ultimate boom would exist on MAKING A NEW USER ENTIRELY - the total rejecter; never user (for all practical purposes) - certainly a Showcase Ad for these extremely low awareness of what your brand IS market - can become better informed and tempted about what YOU have to offer via your brand.

These LOW-KEY, almost, aw-shucks ads - like an infomercial - are the emotional connection to change behaviour ——— not the mind numbing, what did I just see, 30 second blasts of normalcy.

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See just how different regular fast food users are compared to rejecters at my YouTube channel or by following these links:

Frequent user of Fast Food - http://www.youtube.com/watch?v=zTRO81RR7DA 

Hates Fast Food - http://www.youtube.com/watch?v=x8G9OAFlquI

Hello RTAR fans - sorry for the lack of posting - but today, 2011 and this blog starts anew once again. First, I want to thank everyone for their support in 2010: indeed, as you can see from this link - this blog remains in the top Alexa Rankings -  
http://www.alexa.com/siteinfo/restauranttradearearesearch.com# thanks to your interest and support. Please share RTAR with others.

Anyway, tons has happened in six weeks so let’s get started:

First, McDonald’s has been continuing it sales increases - partly thru dead on new product introductions that capitalize on the only segment that is growing - breakfast; and health - McDonald’s Offers New Fruit & Maple Oatmeal - http://www.restaurantnews.com/mcdonalds-offers-new-fruit-maple-oatmeal/ and this link talks about just how BIG the Happy Meal is to McDonald’s - Just How Happy Does the Happy Meal Make McDonald’s? - http://adage.com/article?article_id=147271 - how about sales bigger than IHOP? Wow.

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Indeed, this article wonders: Can Starbucks Adapt Like McDonald’s Has? - http://blogs.forbes.com/investor/2010/11/04/can-starbucks-adapt-like-mcdonalds-has/

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Indeed, the coffee giant may want to keep an eye over their shoulder as Dunkin’ Brands Opens Its 16,000th Location Worldwide - http://www.restaurantnews.com/dunkin-brands-opens-its-16000th-location-worldwide/

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General Restaurant News, Trends - Alcohol Sales at Restaurants and Bars Expected to Increase by Nearly 2 Percent in 2011 - http://www.restaurantnews.com/alcohol-sales-at-restaurants-and-bars-expected-to-increase-by-nearly-2-percent-in-2011/ – and here is a real interesting look at basics: Marketing Sense Isn’t the Same as Common Sense - and uses Little Caesar’s as it’s kicking horse - http://adage.com/columns/article?article_id=146846; meanwhile, Trendspotters Pick Top Five Food Trends at Winter Fancy Food Show - http://www.restaurantnews.com/trendspotters-pick-top-five-food-trends-at-winter-fancy-food-show/ Belgian Waffles and Tea for example.

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Meanwhile, the industry as a whole continues to sputter in a horizontal mode - Restaurant industry sees slow recovery - http://www.suntimes.com/business/3485891-420/restaurants-percent-industry-npd-chicago.html - highlights from this link includes HARD Data like this:

Interesting study, not restricted to restaurant coupons by any means, shows that the `wealthy’ are most likely. If out more at the link: http://www.walletpop.com/blog/2010/11/15/who-is-most-likely-to-use-a-coupon/?icid=main%7Chtmlws-main-w%7Cdl3%7Csec1_lnk3%7C184330

Interested in buying any franchise? Want to Buy a Franchise? The Requirements Went Up - http://online.wsj.com/article/SB10001424052748704361504575552803956439716.html

 New French Fries for Wendy’s? With Sea Salt? Wendy’s Introduces New Natural-Cut Sea Salt Fries - http://www.restaurantnews.com/wendys-introduces-new-natural-cut-sea-salt-fries/ and while this article states that Wendy’s has not re-designed their fries before — I definitely remember Wendy’s having thicker fries years ago.

Third Quarter sales up 4.3% at Texas Roadhouse - http://www.restaurantnews.com/texas-roadhouse-inc-announces-third-quarter-2010-results/ and at Pizza Inn - sales off over 4% comparable - http://www.restaurantnews.com/pizza-inn-inc-reports-results-for-first-quarter-fiscal-year-2011/

More tomorrow.

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.

The other day RBC Capital Markets released the results of a monthly tracking survey of interest to the restaurant industry - here’s the link - http://www.nrn.com/breakingNews.aspx?id=365256. As a market researcher, perhaps most interesting - to me - was the headline “Restaurants May See Diners Spending More”. This statement was, of course, seemingly backed up by the results of the survey - but, really folks, it’s time to be a little more realistic and accurate about `survey results’. (That said, the title doesn’t over promise - just spins non convincing data.)

The `facts’ to support the headline were gathered from the survey with a sample of over 2,700 respondents - and the survey showed an `increase’ - from 5% to 6% -  in the percentage of people who said they were planning to spend more at restaurants over the next three months. The key fact in support of the headline.

So, you mean that as we come into summer, and vacations, that the sliver of folks who take these surveys to heart and wording at its true meaning - might realize - that because of `vacation’ and not being home as much (or substitute the end of being cooped up because of winter weather) - that they `plan’ on `more’ restaurant purchases in the next three months? And, THAT, is what we are to be encouraged by?

Oh, please.

(And, what if last months survey results were 5.4% rounded to 5% and this months was 5.6% rounded to 6%. Even with a sample of 2,700 it’s hard to point to hard evidence with a 1% point move.)

Also, the survey indicates just how `the down’ sentiment and usage of restaurants has been - via the poll. And, supposedly, this also has `glimmers of hope’(?) - in that data - compared to the previous month - this months survey showed that the % of people who say that they are planning on eating less at restaurants in the next three months `dropped’ from 50% to 44% - and, indeed, that looks like good news - until you think deeper about it.

The obvious first — 44%, nearly half of your customers are still trying to cut back on their restaurant usage - a nearly record high number probably.

If this survey is `rolling’ - theoretically - each month - 1/3 of the sample is `doing’ the effect of the `answer’ from the previous month (meaning the folks of three months ago who said `eating less’ - will have - three months later - adopted a lower frequency level) - and when - `re-interviewed’ (theoritically three months later) would be at that `new level’.

Let me explain more. ———- If three months ago 50% anticipated (planned) on eating `less’ at restaurants — one would expect that they indeed cut back to a new level — which the restaurant owner — hopes they DON’T decrease again — hoping that they are now going to answer to such a hypothetical question “about the same (reduced) level” — one certainly - doesn’t hope for those folks - who already reduced their level of restaurant usage to be saying “I’m going to be reducing it more”.

Further, if 6% fewer people are saying they will be reducing their restaurant usage - why did only 1%  (1/6th of that sample) move into `increasing’? Could it be that those 6% are doing exactly as I say above — finding a new `minimal’ leveling off of their own restaurant usage - while others are STILL reducing?

Honestly, one would have to be `creative’ to say the new poll is good news. To me, IMO, as a research analyst, it seems to reflect the `New Normal’ - which is establishing a reduced level of restaurant usage into the future - more and more.

Not only that,  the poll goes on to talk about other economic numbers they crunch that also seem to reflect a `bottoming’ if not an outright `surge’ in consumer optimism. Yes, a surge.

All I can say is - Really? In a worsening job market? In which, the worst on the employment side of our Great Recession  is yet to come? Is that a believable number or is something going on in even the asking of the question and the nations dynamics.

Or, is this consumer number reflective of something else - like new loyalty to a new very different president - more of a hope than anything else. And, indeed, the 38% confidence number (it’s not really called a confidence number but is a roll up of similar characteristics) - up from an 8% reading the month before (do things economically seem 4 times better to you in the last 30 days?) — and, this percentage (38) is strikingly similar to the true hard core percentage of Democrat loyalties and percentages.

And, the poll, in March, after Obama was dissed in the press for being `negative’ and `too realistic’ about our economy in February (when the poll bottomed) - found Obama, in March - being `positive’ with his rhetoric (responding to the critics in Feb.) - indeed, much more-so - (do you remember the change in tone).

And, I bet, the result seen in this survey, was this supposed `huge surge’ in confidence. (The market was also in a bear bounce in March.) Indeed, if such confidence had really returned - the `more often’ number on the planning to eat out more in the next three months - would have spiked too. And, it didn’t.

Finally, I encourage you to look at this incredible visual map of the job losses that have hit each of the 3,000 counties in America - again, this map - which shows the change from job gain to job loss from Jan. 2007 to Feb. 2009 — will leave your head spinning - and in dis-belief — that a surge in confidence is already underway. http://slate.com/id/2216238/

Thanks for visiting today - make a point to read my best posts of 2008 right here http://restauranttradearearesearch.com/important-posts-in-2008/ – and, please visit my Squidoo page too at www.squidoo.com/tradeareasurveys- to learn much more about the research I most suggest to restaurant owners - the MarketView.

Recently, I conducted the MarketView in an eastern seaboard market at all the units of a particular ADI and all owned by one owner. The MarketView is my name for a type of research design that digs into the fundamentals of any market. All kinds of interesting and useful information comes from doing real marketing research at your stores.

An example of this is shown below:

Store One                                                 Store Two

820,000               2006 Sales                             790,000

13%        Uses This FF Brand Most               24%

20%       Uses This FF At Least 1 Week       42%

161K       Annual Sales To 1+ Week User    331K

20K        Total Repeat Customer Base*        13K    *customer base formula

Smart marketing can address each of these stores specific marketing needs. Only by having real customer based information allows for smart spending of those precious marketing dollars. Make sure to visit my Squidoo page that explains more about the MarketView at www.squidoo.com/tradeareasurveys.

Today’s Restaurant Links

`Former Bojangles Exec’s Now Qdoba Men’

http://www.chainleader.com/article/CA6607112.html?industryid=47555

`Fast Food Shops To Be Banned Near Schools In UK’

http://www.dailymail.co.uk/news/article-1079655/Fast-food-shops-banned-near-schools.html 

`IS Fast Food Poised For A Fast Fall?’

http://www.forbes.com/markets/2008/10/22/mcdonalds-earnings-closer-markets-equity-cx_mp_1022markets44.html

Thanks for stopping by today — much more is below too. Bookmark this site and return for more updates. If you have some comments we’d love to hear them. 

Hello, welcome back - I hope your Labor Day holiday was relaxing - that said, my thoughts go out to previous restaurant clients in Louisiana. Today, I want to spend this paragraph encouraging restaurant owners to `get the big view’ of their real market situation. To understand that NEXT year - with proper information - you can do real local marketing that impacts your units.

How you ask?

By doing my MarketView research for which you can find more info about at www.squidoo.com/tradeareasurveys — or go to the site for contact information for my services. If you call, make sure to ask me about the project I did for a fast food chain last year that involved doing over 10 stores and testing over 12 new site locations within the market - for under 30,000.00.

Now - onward to today’s restaurant links:

When Sonic Comes To Town

http://blogs.wenatcheeworld.com/thay/2008/08/28/sonic-wenatchees-newest-health-food-restaurant/ Just a fun story about a NEW restaurant for this community - Sonic. Covers the insanity of a grand opening, roller-skates, and the dealing with an unfamiliar menu by the consumer. Includes less than glorified pictures of the product served and at 10 bucks nonetheless.

Athens Burgers Opens New Restaurant

http://www.mantecabulletin.com/main.asp?SectionID=28&SubSectionID=58&ArticleID=59128&TM=16382.6 Here’s a newer concept to read about. Interesting combination.

Slow Food Conference

http://www.dallasnews.com/sharedcontent/dws/ent/stories/DN-slowfood_0901gl.ART0.State.Edition1.4da40ac.html More and more stories emphasis is on going local with sources of products. Love the `meet the fisherman’ concept.

Wendy’s Rolls Out Double-Stack Nationwide at 99 Cents

http://sev.prnewswire.com/food-beverages/20080829/CLF006A29082008-1.html  Also, is giving away thousands of double stacks over the next year too - find out how.

Discount Dining

http://www.baltimoresun.com/entertainment/dining/bal-bz.restaurants02sep02,0,3747451.story Covers the story as to how restaurants are responding with lower price points in this economic downturn. Covers the marketing efforts of Boston Market, BJ’s Restaurants and Starbucks to name just a few.

Police Warn about TAKEOVER Robberies

http://www.nrn.com/breakingNews.aspx?id=358002&menu_id=1368  Good advice about this growing concern.

Spying On Suburbia - Eating At Arby’s

http://www.richmondchic.com/index.php/mind-body/article/spying-on-suburbia-a-home-like-arbys/268  Strange to interesting perceptions from this blog about Arby’s — 16.00 for two fast food.

Kiss an Attendent at a Fast Food Restaurant

http://www.latimes.com/theguide/music/la-gd-scavenger1-2008sep1,0,5200506.story Wild scavenger hunt includes wild ideas.

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.

Hello, welcome back. This blog is one of the few on the internet about restaurants by a real market researcher of fast food restaurants. I’ve been sharing some insights and I hope you bookmark my blog and return on a regular basis.

Today’s post is dependent on the previous two posts - so, you may need to dig down for a fuller understanding. Essentially, I’ve been outlining some specific REAL information from about a decade ago for a 3 store FF brand that had sales of @2,670,000.00 combined. And, in the last post I revealed the actual size of the combined customer base - based on my Customer Base Formula. Today, I’d like to show what that MEANS in terms of spending by any individual customer within a specific frequency of usage scale. For example:

49 - 4x’s a week users - spend 80,000.00 per yr - @1.6k yr-130mo-31 week

400-2-3x’s week users - 348,000.00 per yr - @870.00 yr - 72mo-16 week

1,800 - Once a wk users- 642,000 yr - @357.00 yr - 30mo - 7 week

3,600 - Once every 2-3 wks - 642,000 yr - @177.00 yr - 15mo - 3.40 week

3,700 - Once a month users - 321,000yr - @86.00 yr - 7mo - 1.66 week

5,400-Once every 2-3 mtn - 241,000yr - @ 44.00 yr - 3.68mo - 85cents/wk

2,100-Once every 4-6 months- 26,000yr - @12.00yr - 1.00mo -24cents/wk

21,700-Less than every 6 mo - 187,000yr - @8.61yr - 72cents a month and 18 cents a week

These stores had 7% first time users spending about 187,000 a year — 2,100 new customers a month or about 25,000 new customers in a year.

Now, just to ask you as a  restaurant owner — if you knew that @21,000 of your 38,000 customer base spent less than 9 dollars a year at your store - would you be willing to try a method to change it? IF SO, give me a call on my cell ——– you can find that information by going to my site about Trade Area Surveys — www.squidoo.com/tradeareasurveys

Now - today’s restaurant links.

“…nutritious fast food. Maybe it’s not so bad after all.”

http://blog.nj.com/parentalguidance/2008/07/i_was_wrong_about_fresh_apple.html Maybe, just maybe, the Tide is turning.

“…research from Just Kids Inc’s Global Kid Study, which showed that children daydream about helping others and are becoming more altruistic.”

http://www.brandrepublic.com/News/838897/McDonalds-launches-conservation-themed-Happy-Meal/   Perhaps someone will beat McD’s at this in the states?

Economic Slowdown Forces Choices in Food

http://www.ausfoodnews.com.au/2008/08/12/economic-slowdown-forces-trade-down-in-food-spend.html   Holds true worldwide.

Panda Express Thrives On Orange Chicken

http://www.latimes.com/business/la-fi-panda13-2008aug13,1,3381302.story Success story - focused on customers.

That’s all for today — remember to bookmark this page. Thanks.

Nearly all of the clients I have are owners of franchised restaurants - and = one thing they nearly always have in common is that they have limited `marketing dollars’ above and beyond the % they already pay to corporate to market the brand-name. That said, they do have SOME dollars and the decisions as to whether to sponsor a youth team, local charity golf tournament, do limited in-store marketing via bouncebacks, or buy billboards - are important image and marketing decisions.

When choosing to spend those limited dollars, it’s probably best to `do both’ - local image building and REAL marketing such as billboards. One of the `advantages’ that comes from using my services - doing what I call the MarketView — is that the owner knows the CUSTOMER BASE SIZE and type of user - of every individual unit in a market. And, based on that information - the owner knows which units are best and worst in converting their total customer base into `heavy’ users (some chains define this as the once a week customer, others, the once a month customer). Accordingly, the owner then has some direction from the research on how to spend those precious and limited local marketing dollars.

Much more on Customer Base Estimates in future posts - or - find out more at my squidoo website www.squidoo.com/tradeareasurveys.

TODAY’S RESTAURANT LINKS

Are Fast Food Building Restrictions Constitutional?

http://worldnetdaily.com/index.php?fa=PAGE.view&pageId=71377  Michael Ackley does a satire piece about how `gray’ the law becomes when thinking of `fast food restaurants’. A quick two minute read you don’t want to miss.

The Rise of the Breakfast Segment

http://ap.google.com/article/ALeqM5jGpPSjXCwpcs-JKUmPG3Gy5sht8QD92BG2380  Excellent article on how chains are increasingly looking at breakfast items as the way to more sales. Denny’s new containers and IHOP’s increase in take out over the past year is examined; as well as the reasons the FF chains have been successful in stealing the business from the sit-down breakfast eateries. Notes that some chains are thinking of offering breakfast items all day long. Finally gets into new offerings from FF restaurants including Carl’s Jr new product: “that features two eggs, bacon, sausage and cheese between grilled sourdough bread.”

Forget The Free Food and Drink Refills

http://www.startribune.com/business/26188614.html?location_refer=Most%20Emailed:Homepage:12 This story covers the many ways that restaurant owners are mitigating the increase in prices for foods and the increasing reluctance of patrons to eat out often. Here’s a quote from the 3 minute article:

The real problem, they argue, is that many large chains overbuilt at a time when Americans were starting to pull back on restaurant spending….Now, unable to raise prices to match rising wholesale food costs, so-called “menu makeovers” have become increasingly common

America’s WORST Restaurants For Kids Revealed

http://www.emediaworld.com/press_release/release_detail.php?id=120323  WOW - amazing article that GRADES each chain for offerings and other attributes related to healthy eating.  Getting A’s were Chick-Fil-A, Subway and Wendy’s - Getting F’s were Applebees, IHOP, Olive Garden, Outback, Red Lobster and T.G. I. Friday’s. A 3 minute, must read article.

In my decades of doing Trade Area Research, specializing in `attrition estimates’, — I’ve often done projects that involved market expansion considering new store locations that involved one franchisee vs another. Usually, these project originated with companies in which I was the National Supplier of this service (two national fast food chains) but occasionally not (being known by different franchisee’s in the same market who hired me as an arbitrator/fact finder).

Most national fast food brands have a policy concerning `trade area infringment’ - with the establishment of `what level of attrition’ is `acceptable’ with new store development (those `acceptable’ dollars leaving YOUR pocket and bottom line). And, most fast food brands have a policy of `who pays’ for such research too. Want to find out that type of info? — Then send me an e-mail at southernsurveys@aol.com - describe your situation and I will tell you more specifics (please include a contact phone number).

Today’s Restaurant Links

Brown Bagging at Lunch Hurting Restaurant Sales

http://www.qsrmagazine.com/articles/news/story.phtml?id=6996 —A fantastic, research supported, four minute read with many insights - but, perhaps an exaggerated title about brown baggers as the `increase’ is barely measurable (35 increasing to 38 times (a year?)) and is probably within the range of `plus or minus’ for the two compared surveys. Here’s a quote from the article :

“There are a number of factors adversely affecting the mid-day meal business at restaurants, and brown-bagging is one of them,” says Harry Balzer, vice president, The NPD Group, and author of Eating Patterns in America. “Certainly the economy, growing unemployment, the erosion of disposable personal income, slow-down in number of women entering the workforce, and more telecommuting options are also influencing consumers’ lunchtime behaviors

Frankly, to me, the decrease of sales is likely the erosion of disposable income and telecommuting - brown bagging is the result as opposed to a cause. Indeed, for consumers living in under-penetrated fast food markets (one FF several miles away) the increase in GAS prices is probably a factor too. After all, the 3.99 combo is REALLY 5.99 if the roundtrip is 10 miles and you get 20 miles a gallon.

The reality of smaller trade areas is increasing - and - not just because of the gas price — I will talk more about that in future posts.

KFC’s Vegetarian Sandwich - Isn’t

http://consumerist.com/5027777/kfcs-vegetarian-sandwich-isnt-stop-kidding-yourself-that-fast-food-restaurants-have-vegetarian-options  I almost had to laugh at this article due to the HARD vegetarian position. Indeed, make sure to read the comments as they are most insightful.

Drive-Thru Reseach Study 2007

http://www.qsrmagazine.com/reports/drive-thru_time_study/  This is a MUST read about how different fast food brands are dealing with Drive-thru business - vital, of course, to nearly all FF and the bottom line. This is not a short read but worth it. Here’s a sample table:

Of course, one of the main reasons to do on-site research at your restaurant is when you decide to build a new unit in your same market. Obviously, you don’t want to build a new location in a likely spot that is within your existing stores main trade area. This is when you need to conduct a Trade Area Survey at your restaurant that includes a `cannibalization question’ for your customer base.

The exact wording of  the cannibalization question is of vital importance to the accuracy of the data your interviewer will gather (or is this going to be YOU speaking with your customers). Since I have written questionnaires that were used in 100’s of cannibalization studies - I know that answer for you. You can find more at www.squidoo.com/tradeareasurveys .

Today’s Link

Starbucks Introduces New Drinks

http://www.slashfood.com/2008/07/15/starbucks-new-vivanno-nourishing-blend/?icid=200100397×1205764383x1200288208

New `food’ choices (or a new menu) are real reasons for returning to a restaurant - another reason to introduce a new product is to jump on a trend or stifle a competitor. Seems to fit with the `new’ Starbucks of 2008.