Lane Cardwell

Winning at the Restaurant Game

I saw Ron Paul of Technomic at the Marketing Executives Group conference in Chicago the week before last. Seeing him reminded me of a white paper that they published for attendees of the Restaurant Leadership Conference recently. It was titled “Satisfying the Changing Consumer: The Winning Restaurant Formula”. Technomic does a lot of good work in helping chains make sense of trends and customer behaviors in the restaurant industry. This paper did a great job of framing the decision process in choosing a solution for a meal and the factors that are in consideration. They believe that the formula for success is easy to diagram and difficult to master:

I will quote the paper briefly to give you the essence of their message, but be sure and read the entire paper. It is relevant in that it takes many elements that we talk about being keys to success in isolation (“hot food hot”), but seldom get to see the overall picture of what is success.

Consumers consider dining at restaurants an important “Quality of Life” factor. They also realize a balance must be struck with tightening discretionary income levels. In many cases, the reconciliation of these two factors creates an element of “perceived pressure” to choose the right restaurant. Smaller disposable income levels often means fewer restaurant visits. When the opportunity to enjoy a meal purchased away from home does occur, consumers want to be very sure there are no surprises. If, for whatever reason, the overall meal experience does not match the dining party’s expectations, there may not be an immediate opportunity for a “do-over.”

Influenced by this mindset, consumers will tend to select restaurants based on which have earned their coveted “Top of Mind” positioning. The question then becomes: “How do concepts achieve this perceptual status?”

The Winning Restaurant Formula

A certain number of restaurant visits will always be driven by a desire to find venues offering the absolute lowest price point. However, many consumers are also looking for restaurants offering additional dining elements that combine with price to create a strong, memorable concept Value Proposition. These individuals, many of whom are juggling both personal and professional responsibilities, seek meal solutions that fit seamlessly into their lives and satisfy specific foodservice-related needstates.

Long term, consumers’ dining occasion “wants and desires” suggest “Winning Restaurants,” regardless of price point, will uniquely combine effectively executed concept/customer interaction points with an acceptable price. The Winning Restaurant Formula is based on extensive Technomic studies that examined why certain concepts resonate with consumers while others remain perceptually undifferentiated. Findings revealed that concepts providing only “acceptable” levels of food and service don’t stand out within their competitive set.

This “sameness epidemic” translated into slipping comparable store sales and diminishing traffic counts beyond what the current economic malaise can realistically have been expected to produce. At the same time, other restaurants in the marketplace have capitalized on current conditions, creating stronger customer bonds and setting the foundation for future success. These winning concepts have developed a two-part equation that creates a unique, consistent Value Proposition. It is a formula that blends “Consistently Solid Basics” and “Resonating Points of Differentiation.”

Consistently Solid Basics

  -Service

  -Food

  -Unit appearance  

                    +

Resonating Points of Differentiation

  -Lifestyle integration

  -Hospitality

  -Menu desirability

  -Atmosphere

  -Concept essence

  -Manager Presence

                    =

Winning Value Proposition

Like I said, the formula is easy to write, hard to accomplish. Every concept should go through a regular self-appraisal to see where they net out on the above elements. The customer is doing it every day. We might as well spend a little time on it also. 

Posted by Lane Cardwell on May 24, 2009 | Comments (5)