Restaurant Trade Area Research

Once again, McDonald’s is on the cutting edge - great story - http://www.dailymail.co.uk/sciencetech/article-1322180/McDonalds-tracks-burglars-spraying-artificial-DNA-make-getaway.html

Dunkin Donuts expanding in TN. - http://www.restaurantnews.com/dunkin-donuts-announces-seven-new-restaurants-in-tennessee/ - make sure to see my questions and answers about Trade Area Surveys here before you do any expansions and to know more about your market - http://www.squidoo.com/tradeareasurveys

IHOP is re-positioning a portion of its menu to attract the light eaters - http://www.restaurantnews.com/ihop-makes-lower-calorie-dining-choices-simple-with-new-menu-items-and-tips/

When was the last time you did any research with Fast Food Rejectors? Here one here: http://www.youtube.com/watch?v=x8G9OAFlquI

Often when I do fast food research we ask customers to give a rating about price or cost of the food. What I’ve found about ratings is that it all depends on what one wants to pay - 4.00 is too high for some and wonderful for others - as is 6.00 or even more (on occasion).

That said, currently, three main price points are the main focus of advertising – 1.00 or less — 2.99 `meals’ —– 5.00 price points. My suggestion to clients of FF stores has always been to `offer’ the various price points to not shut out part of their FF market (for at least part of the year if not always) - specifically those more money conscious  customers in these tough economic times and shrinking trade areas.

Makes one wonder if  `recession combos’  might be a good marketing idea - small fry, smaller main sandwich, small `value’ drink - small price.

BTW - Last months stats were the best yet for this blog - thanks for reading. I hope you continue down this page as there is lots of good info and links. Finally, have you visited my Squidoo site yet at www.squidoo.com/tradeareasurveys ?

Today’s Restaurant Links

`A&W’ Begins Revival In Wisconsin’

http://www.postcrescent.com/article/20081107/APC0701/811070568/1436/APC03

`Fastest Fast Food’

http://www.nbcaugusta.com/news/local/33604619.html Cool test done by TV station at Arby’s Wendy’s, BK, and McDonald’s — drive thru, order number one combo and set the stopwatch. Cool quick read - who do you think won?

`Fast Food Order Accuracy Rising’

http://www.freep.com/article/20081103/BUSINESS07/81102051 Fewer language problems and better qualified workers in economic downturn.

`Fast Food Warpath’

http://www.thisisscunthorpe.co.uk/showbiz/Jamie-Oliver-fast-food-warpath/article-456067-detail/article.html The continuing rise in fast food limitation laws.

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.

Hello restaurant owners, and welcome back to Restaurant Trade Area Research - where I share over 30 years of insights from doing restaurant research - and, link to the latest of interest in the restaurant universe. Today I want to share with you the actual findings in a 3 store market about a decade ago.

While I won’t go into the extreme measures that need to be employed to have a VALID sample to begin with at a fast food restaurant (but you can find out more at my other information site www.squidoo.com/tradeareasurveys) - here are the results I want you to consider.

3 stores - $2,670,000 Sales (rounded)

customers that come 4+ times wk - 3% of trans - 80,000 in sales

2 or 3 times a week - 13% of trans - 348,000 sales

Once a week - 24% of trans - 642,000 in sales

Once every 2-3 weeks - 24% of trans - 642,000 in sales

Once a month - 12% of trans - 321,000 in sales

Once every 2or3 months - 9% of trans - 241,000 in sales

Once every 4to6 months - 1% of trans - 26,000 in sales

Less than every 6 months - 7% of trans - 187,000 in sales

First time users - 7% of trans - 187,000 in sales

You would be surprised how many owners DON’T think of their real customer base in this manner - what levels ACTUALLY provide the real dollars to a store. This weekend in this blog - I will expand on the data above. But, now, to today’s restaurant links - feel free to comment too.

Today’s Links

Fast Food Prices On The Rise

http://c13.zedo.com//ads2/f/341180/1/172/0/305001132/305001132/0/305/331/zz-V1-pop1217960041201.html?a=;l=;p= Video report too with story.

Healthy Fast Food For Kids A Tall Order

http://www.webmd.com/parenting/news/20080804/healthy-fast-food-for-kids-a-tall-order  This is a report issued by Center for Science in the Public Interest which rips a new opening for many restaurant brands. Detailed read with lots of interesting facts.

New Jobs In Fast Food

http://www.istockanalyst.com/article/viewiStockNews+articleid_2450358.html This article is about a company that provides your drive thru order taking with folks working out of their home.

Is a Fast Food BAN - Racist?

http://www.momlogic.com/2008/08/fast_food_banned_in_poor_areas.php#over1 After all, how can those fatties in Beverly Hills be helped?

Arby’s Signs Development Agreement For 41 New Stores In New York Metro Area Over 10 Years

http://www.businesswire.com/portal/site/google/?ndmViewId=news_view&newsId=20080805006617&newsLang=en

Again, would love to read your comments. Thanks for stopping by - bookmark for more this weekend.

At the corner of Sandy Plains Road and Hwy 92 in North Atlanta you will find a Back Yard Burgers that has gone out of business. Most likely the owners did their due diligence and checked out the basics like traffic counts and the demographic profile of the area. Not only that, I bet what they found sounded perfect for the Back Yard Burgers positioning as an upscale hamburger restaurant. Indeed, the intersection has huge amounts of traffic and the demographics of the area would indicate `families’, plenty of roof tops, and plenty of income.  That said, the fact that a Checkers went out of business at the corner on the opposite side of the street - could have indicated that the location be viewed with caution. (The Checkers challenged an existing McDonald’s. The corner is now home to an Italian sit down restaurant.)

So, what happened? Personally, since I was a VERY light user (3 times in perhaps 3 years) I can’t speak to operations of the unit - but the experiences of my 3 in-store visits went very well. No negatives. So, assuming it wasn’t an operation problem - what gives?

What gives is that you need MORE than perfect demos and traffic counts; you need to understand the real market potential of an intersection. And, the real traffic flows for `your side of the street’.

First off, before you think the intersection was `too busy’ and had huge back-up’s of traffic that no one would want to get `re-involved’ with after visiting the restaurant - forget that. This is a well flowing traffic pattern. That said, most restaurant owners are aware that some intersections are `too busy’ and don’t make a `good spot’ sometimes.

No, it wasn’t that at all. The problem with the traffic counts in this instance was that most of it was `long - flow traffic’ — most of it going miles beyond that intersection as a final destination. Additionally, the location had difficult access due to raised cement in the median - bad access especially can limit great lunch numbers; and females.

Additionally, the trade area likely did not have good daytime worker demographics - as one would assume the `hamburgers’ skews male in positioning - and, likely, not even a strong daytime worker number compared to other intersections with less traffic.

Finally, another word about demographics — a given stores demo’s will almost NEVER fit the demo’s for a 1-3-5 mile area. Most restaurants need to know what subgroups are likely to be important (those with higher indexes) to a normal store like theirs. IF you have a restaurant that features 1/3 lb. burgers — you might want to know the indexing of males within the real trade area. (The real trade area of this store was probably ONLY Sandy Plains Rd. and probably mostly on their side of the traffic flow within 2 miles before Wigley Rd. — NOT a big real trade area.)

But, finally, the real story in this instance - was probably the competitive environment. A Five Guys opened in the direct competitive area, probably cutting off and being `first’ to a large part of Back Yard Burgers lunch traffic and even dinner traffic - and in a more accessible (in and out) location. Splitting the hamburger business with McDonald’s was one thing - 3 way splits - can close a marginal restaurant with poor access to traffic flow.

Looking over potential sites - is a service I’ve provided - find out more about my Trade Area services at www.squidoo.com/tradearearesearch

Today’s Links

Woman Wants To Limit Fast Food Restaurants

http://www.todaystmj4.com/news/local/26152264.html Now that laws have started by activists to limit fast food locations - expect to see your local do gooder getting more and more exposure for such thinking. This is a story about a neighborhood group that says 6 fast foods on a road are enough - too bad for the Church’s Chicken.

Jake Says `Don’t Use The Drive-Thru’

http://poststar.com/wordpress/?p=5836&cat=47    Seeing the miles at zero while sitting at the drive-thru; will bring out the Greens.

The EAT IN Lunch User

http://www.chainleader.com/article/CA6581159.html?industryid=47557 Quarterly survey by Quick - Track; real research and real numbers.

When it flashed across the newswires and TV headlines - most readers were stunned - suddenly, a restaurant icon was `shutting its doors’ - Bennigan’s. No, this was not your lowly newbie who was closing after 50 stores; this was one with hundreds and a history. And, if you have been under a rock for the last 18 hours - the news is that the company owned stores are closing. You will find the link below.

Is there any marketing trade area information in all this? Perhaps.

For example, if a company unit was near a franchisee restaurant - some of that company unit customer base may become part of the large  `occasional’ users customer base of any given unit. Certainly billboard ads in the vicinity of the closed store with an `open stores location’ could be effective - or - targeting the likely home zipcode of the closed store with direct mail. (Perhaps corporate will share such info if they have done the appropriate research at the store level in the past.)

Finally, not ALL of the corporate units would have been `bad’ sales - aggressive restaurateurs could open franchisee units and fill in the void in valid market areas. That said, suddenly the market has many more empty restaurants waiting for a new concept.

Today’s Links

Bennigan’s

http://www.marketwatch.com/news/story/bennigans-franchising-company-lp-steak/story.aspx?guid=%7BE5283276-F8A1-44C4-8D83-EB9857B37D11%7D&dist=hppr   Franchisee’s to remain open.

Bennigan’s Wake

http://www.chicagotribune.com/business/chi-wed-bennigans-closing-jul30,0,6474654.story Longer, more in-depth read on the industry.

Denny’s Second Quarter Numbers

http://www.marketwatch.com/news/story/dennys-corporation-reports-results-second/story.aspx?guid=%7B2B41FDD2-AB42-402E-BCB2-42880BCED8F6%7D&dist=hppr Hard to put up `up’ numbers these days.

Banning Fast Food Drive Thru Windows

http://network.nationalpost.com/np/blogs/posted/archive/2008/07/29/better-watch-your-butts-in-calgary.aspx Beware of this sentiment.

Cheesy Macaroni Bites

http://laist.com/2008/07/29/simply_wrong_food_jack_in_the_boxs_1.php New Product of Jack In The Box; interesting product picture.

This blog is saddened to report the continuation of government restrictions into how you run your business and where you run your business. In this instance, the `how’ would be the government demand to use or not use a particular cooking oil (regardless as to the outcome of the final product - including taste - one of the most important attributes to your customer base) and the `where’ is the new restrictions on where fast food restaurants CAN’T be developed. Can fast food brands eventually be expected to fund the `alternative’ restaurants too? After-all, what’s to prevent a city council on deciding that FF restaurants would be `better’ for the community if they weren’t open 7 days a week?

Today’s Links

California Outlaws Trans-fats and Bans Fast Food Outlets in Defined Area

http://www.telegraph.co.uk/news/worldnews/northamerica/usa/2461615/Los-Angeles-bans-new-fast-food-outlets-and-California-outlaws-trans-fats.html 

It was funny seeing the 800 plus article titles on this one — only a few positioned the move on trans-fats with a positive headline title. One can only imagine what may happen if politicians turn their interest againist the industry.

Fast Food Goes To The Movies

http://www.sfgate.com/cgi-bin/blogs/sfgate/detail?blogid=26&entry_id=28501 

Quick read on the movie tie-in’s currently going on. Specifically tells what each restaurant chain DID on their end of the relationship (T-Shirts for workers, special cups, etc.)

Crowd MOBS Taco Bell Opening

http://www.rutlandherald.com/apps/pbcs.dll/article?AID=/20080724/NEWS01/807240408/1002/NEWS01  

This is a wonderful article you don’t want to miss about how folks LOVE getting their fast food. A great counter balance to the desire to BAN fast food elsewhere. ———- One comment however, always be ready for an amazing first opening day crowd and have your operations in order. Remember, one bad experience can turn 15% against a second visit.

Majority Stake in Applebee’s Franchisee Sold

http://www.nrn.com/breakingNews.aspx?id=356918&menu_id=1368

I was involved with Applebee’s findings when they had one unit on Memorial Drive in Atlanta and W.R. Grace was the interested party. Want to have a researcher like that - give me a shout - find my number on my squidoo site www.squidoo.com/tradeaareasurveys .

 11.23 For Lunch At Steak and Shake

http://www.indystar.com/apps/pbcs.dll/article?AID=/20080721/BUSINESS09/807210323/1109/BUSINESS09

Yet, somehow, that is not the ultimate problem? Article covers the challenges to the new company leader.

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.

I once pulled into a fast food restaurant in Tennessee off I-75, and, was going thru the drive-thru, when, after the speaker, I encountered a smiling young lady doing `surveys’. Being a marketing researcher who has conducted thousands of similar surveys and also who has trained hundreds to do the same - this was the big moment - a validation of what I did. But, after my answer to the first question (the coming from question) I was asked to move ahead to the window (my answer was that I had traveled from KY on a vacation). Knowing that they would want more info than that - I asked what the survey was about - she indicated it was about a new store that would be north of this one, also on a I-75 exit (I would have passed this first). I said, don’t you want to ask me more questions - “no, I can fill it out myself”.

Unfortunately, it’s very unlikely this interviewer was doing her job and certainly there were more questions about an attrition situation — which is of vital importance to the operator of the exisiting unit in question. And, while this level of `research’ is not usual, and also is WORTH NOTHING, it often represents a fair portion of the data (using interviewers not trained or supervised upon beginning real interviewing). As you know, as an owner of a restaurant — millions may ride on the outcome of `cannibalization’ surveys - if done at multiple units in a market.

Having the highest level of data collection is of utmost importance to expansion within a trade market - a service I provide - read more about trade area surveys at www.squidoo.com/tradeareasurveys .

Today’s Links

1. http://money.cnn.com/news/newsfeeds/articles/apwire/e6edbb1117015e037cd739ba89205815.htm

DineEquity Inc releases 2Q sales for same stores - shows IHOP up, Applebee’s down. Quick read.

2.

http://www.bizjournals.com/triangle/stories/2008/06/23/daily27.html

Olive Garden has same store increase, not as good for others in company.

3. http://www.streetinsider.com/IPOs/Dave+&+Busters+Holdings+(DANB)+Files+$170M+IPO/3816999.html

Dave and Busters files IPO. We have D&B in Atlanta - the evolution of this concept has been well executed. The TV ads of the combo food and fun price were well positioned. FUN sells.

4 - LINK OF THE DAY — “TGI FRIDAY’S” Research study. - http://www.chainleader.com/article/CA6578744.html?industryid=47553

Wonderful research study showing the benefits of research and customer satisfaction - and, what attributes to focus on to achieve that result. Free food, of course - but much more. A great marketing article.

Hello store owners and corporate restaurant folk - welcome to the Saturday edition of Restaurant Trade Area Research - the restaurant blog of Rick Phillips  - a market researcher with over three decades of real fast food customer research at the street level (in the stores).

Today’s topic - drive thru operations. —- Over the years, many attributes have been associated with drivers/customers experiences while waiting to purchase your product without leaving their comfort cage (the car). But only one attribute will almost immediately turn away a customer if they have any alternatives for food - the long line before the speaker. Only with previous good experiences with the restaurant at the drive thru (with long lines), will maintain the customer in line for today.

With the drive thru often contributing over 50% in sales - this is not a lecture on the need for speed. And, indeed, many issues related to drive-thru’s will be explored in future postings. So, what this post is imploring in all operators minds is the new reality of 4.00 gas - to the point that the operator realizes that `while idling’ the customer is probably having this thought `what a waste’ (of money, more than time).

Marginal customers to the fast food customer base may be weakened more than usual by drive thru delays - especially those in SUV’s (if you get what I mean). So, this is more a time than ever to get your best crew on the window - don’t idle your drive-thru traffic away.

Now, onto today’s links.

Today’s Restaurant links (July 12th 2008)

Second Q Wendy’s Sales Up

Link - http://www.bizjournals.com/wichita/stories/2008/07/07/daily32.html

Up over 1% at franchisee locations - up at company stores too - after a down first Q.      RTAR - rating - 8 - Being from Ohio many years ago; yeah for Wendy’s. Perhaps the `choice’ of sides attribute helps.

Ruby Tuesday’s Same Store Sales Off for 4th Q

Down over 5% at both company and franchised units this Q. That said, many indicators look good according to the two minute article with quotes from the founder. >>>>>>>>>> RTAR  rating - 5 - No one likes sales to fall significantly at a signature national restaurant (could it be those who loved the German Potato Salad?) - that said, much is sited in the article of importance including the satisfaction scores. So; is it a shrinking total trade area? (Trade area research on stores with prior existing studies done at the store level reveals this information. Indeed, this is the exact information I’ve given to clients on repeats within their markets.) Or, just the competitiveness for the discretionary dollar?

Green Fast Food - Really Here or a Green Dream

Link: http://www.socialfunds.com/news/article.cgi/2529.html  This article is about a 4 minute read. It rehashs alot of the grist of what the environmenalists want out of companies and fast food restaurants inparticular. Styrofoam is the big meanie. However, several hundred have committed to a more aggressive program - this could be for you if you live in a highly committed `green community’ and could aid store usage by limited few - hippy, yuppie, and student oriented trade areas come to mind.     >>>>>>>> RTAR rating - 6 - Just make sure you aren’t the LAST to do this if you are in one of the above stated communities. But, wait, do `environmentalists’ comprise a worthwhile worry or significant market for FF restaurants - not yet. Lastly, however, remember the Karma factor.

Hello to everyone in the restaurant industry, welcome to my new blog, my name is Rick Phillips. In this blog, I intend to draw on over 30 years of direct, in the field, restaurant research that I have conducted for numerous restaurant chains. Some of this research was qualitative - focus groups or one-on-one research; most of it was quantitative - done on-site with 10’s of thousands of restaurant customers over three decades.

Ideally, this blog will speak to the restaurant owner who wants to read frequently about store operations, marketing issues and promoting ones business. It will often feature links to daily stories in the restaurant field - spiked  with  my commentary and analysis. I hope you enjoy the daily links - such as these three today July 10th 2008:

Denny’s Responds To America’s Demand For Breakfast

Link - http://www.marketwatch.com/news/story/dennys-responds-americas-demand-breakfast/story.aspx?guid=%7B0911022C-AD79-4B44-8B1C-7376F7D1A870%7D&dist=hppr  Denny’s introduces  the `Denny’s Dome’ to facilitate To Go business. The `Denny’s Dome’ is an innovative, multi-level and task, carrying device that seems to handle any type of full sized breakfast - and keeps it fresh and hot up to a half-hour.You have to see the picture of this multi-leveled  see-thru container - which even has a method for keeping foods crispy (read to find out the science).  >>>>>>>>>>>> RATR Rating - 9 - Interestingly, in the 1980’s I conducted one-on-one research for several package good companies; even in the 80’s `tupperware’ type of containers could store foods at the same temperture they were first stored at  for HOURS. The funny part was research respondents were worried about `bacteria’ forming if the food was kept hot for an extended period — but - at 1/2 hour - that should not be a perception problem. Indeed, this is a great idea and seems like the top of the line product/device that `to-go’ food customers may have been waiting for. It also could increase the size of the stores trade area since the product would remain warm to take home to nearly any local area. For example, it could permit the `drive thru the area’  customer traffic to `stop in and pick up’ a breakfast before driving home 8 miles away - such as having a store by a Home Depot or other big box store. Additionally, in these cash strapped times, it allows for the customer to avoid the tip, possibly increasing customer frequency (viewed as a surcharge these days?) - that said, many tip at the counter on the pick-up orders.

Lack of Advertising May Have Doomed Fast Food Restaurant

Link - http://www.beaumontenterprise.com/business/local/lack_of_advertising_may_have_shut_down_fast-food_restaurant_07-08-2008_18_17_04.html Article indicates that having a poor location, and difficult obstructions to your restaurant - along with having an unfamiliar product (being the only franchisee in a market) AND a lack of advertising and community invovlement - MIGHT have been reasons for a Krystal’s demise.  >>>>>>>>>>>> RATR Rating - 7 - One of the things this blog will do is feature stories about the success or lack of success of various fast food restaurants - chains or individual stores. Indeed, my experience in seeing first hand hundreds of fast food outlets - both high and low sales units - provides me an overview of characteristics important to customers. This article, which could be written about many thousands of restaurants nationwide, is an example. One finding I’ve had for example is the near absolute neccessity of making flow of customers onto the restaurant property mindless - hurdles should NEVER have to be jumped - especially if you value your female customer base. The article implies that perhaps the demograhics weren’t the exact fit either - while demographic `fits’ might be nice - the size of home and worker bases within specific milage is more important to success. Often your demos for a restaurant won’t fit the area - but - your restaurant does fine by dominating within your subgrouping (besting your competitive environment). Finally, of course, being NEW or ALONE in a market (brandwise) does usually require some outreach or education of your market about your restaurant - and probably does require even some advertising. But, what RTAR suggests is that when one’s unit is in sales trouble (as opposed to a unit that never has good sales, after initial opening month) is to look first at the competitive environment (new restaurants) and then at operations (frequently some daypart - ie: employee group - is the problem; this will first show up slowly as only the Heaviest store user is aware of the operation problem - they are forgiving as they love the product or the location - but they will reduce frequency. If the problem, daypart related, continues - a unit can be in for a big decline suddenly after 6 weeks or so.) Finally, it’s unlikely your store will go out of business do to a lack of `community involvement’ - but - obviously, a banner at the local softball field - can be worth it’s weight in G.

Fast Food Veggie and Fruit Carts

Link - http://www.redorbit.com/news/business/1468962/call_for_fastfood_fruit_and_veg_carts/ >>>>>>>

RATR  Rating - 6 - Story is about a call in England to favor push carts that feature fruits and veggies so that folks get their needed five servings daily. —– Could the `States’ be next? Could real food be the next `brand extension’ for FF restaurants?

Thanks so much for reading this first blog post - To find out more about my services - please use my blogroll to my other `restaurant sites’. Please bookmark this site, I will try to post 3 or 4 times a week the type of stories owners of restaurants want to read.