Published on May 20, 2009
Food & Beverage Marketing Food and Beverage Operations Food and Beverage Operations Tuesday, May 19, 2009 1
Chapter Objectives • Explain marketing in terms of delivering guest- pleasing service • Describe the steps involved in developing a feasibility study and list the three types of ongoing marketing research • Describe the elements of a complete marketing plan, focusing on the roles of sales, advertising, PR, and publicity • Identify marketing tactics for noncommercial food service operation Tuesday, May 19, 2009 2 Why do we do the things we do? The most valuable asset of any company is repetition and growth: Guest Service Market Research what drives data? People, popularity, trends, Starbucks is one example of a coffee shop gone global Tactics of business
Managers Concerned about Guests • “Moments of truth” • Recognize that service is as important as the product • Develop guest-friendly procedures that meet the operation’s standards and goals • Assess and respond to guests’ ever-changing preferences and needs Tuesday, May 19, 2009 3 Moments of Truth: Some can be tired sayings Ritz-Carleton: Our motto states that “We are Ladies and Gentlemen serving Ladies and Gentlemen,” Moments of Truth: How are you going to “Wow” me today? Includes employees as well as the guests
Functions of a Feasibility Study • Identify market area characteristics • Evaluate the proposed site • Analyze competitors • Estimate demand • Project operating results Tuesday, May 19, 2009 4 Gambling 101 Not considering a feasibility study 95% FAIL RATE Who is your customer/guest? Demographics Area and amenities, ﬂow of trafﬁc: Restaurant is on side street or on a busy corner. In a high rise penthouse or in the basement without windows? Who is the competition with your concept? Do you have superior products or service? Nordstomʼs vs Macyʼs Demand shapes hours of operation, labor and product usage Honeymoon- Estimate how your F&B operation will consistently be able to preform after the popularity wears off. Consideration of a feasibility study 50% SUCCESS RATE
Market Area Characteristics • Demographic information • Retail sales volume • Number and types of business • Impact of tourism • Available transportation • Economic stability Tuesday, May 19, 2009 5
Evaluating the Proposed Site • Availability and convenience of parking • Traffic flow • Presence of other attractions that may bring in guests • Site accessibility Tuesday, May 19, 2009 6
Analyzing the Competition • Location • Availability of Liquor • Type of establishment Service • Times of operation • Entertainment • Menu prices • Promotional efforts • Average Guest Check • Chain affiliation • Type of Service • Other service distinctions • Number of Seats Tuesday, May 19, 2009 7
Estimating Demands • Surveying potential guests by – Personal interview – Direct mail questionnaires – Computer-assisted survey • What to ask: – Food preferences – How often… – How far… – How much time… – How much money… Tuesday, May 19, 2009 8
Projecting Operating Results • Financial results – Forecasts of food & beverage revenue – Overhead Expenses: • Administration • Labor • Facility maintenance • Energy • Rent • Insurance Stay Current! • Taxes Tuesday, May 19, 2009 9
Ongoing Marketing Research • Property Analysis – Appraisal for production, service areas, products, and services – Outsiders’ viewpoint • Competition Analysis – cover the same categories listed in the feasibility study – Visit competitor’s operations at a variety of times • Market Analysis • Government Statistics and Data Tuesday, May 19, 2009 10
Market Analysis • Guest Profile Research – Age – Gender – Frequency of visits to the property – Employment • Data Gathering Tools – Guest surveys – Guest comment cards NRA website http://www.restaurant.org/research/ Tuesday, May 19, 2009 11
Market Analysis • Marketplace Factors/Trends • Changes in demographics • Positive and negative events in the community, region, state, and nation • Cost of energy and other utilities • Government regulations • Cost of travel Tuesday, May 19, 2009 12
Steps in a Typical Marketing Plan Select target market Determine Objective Create action plans Evaluate and revise Tuesday, May 19, 2009 13 Also related to a Business Plan
Implementing the Marketing Plan • Sales efforts • Advertising • Public relations • Publicity Tuesday, May 19, 2009 14
Special Promotions • Cut-out Coupons • Product Sampling • Contests • Package • Premiums • Gift Certificates • Discounting • Bonus Offers • Frequent Diner program Tuesday, May 19, 2009 15 Depends on your demographic Fast food chains do this alot Incentive needs to be built with a message to return Concerns not to cheapen your business with frequency What are you trying to accomplish? One time diner or repeat? If repeat you have one moment to have them consider you again and return
Outdoor Sign Advertising •Pros – Low cost – Long life span – Broad reach •Cons – Limited message length – Wasted coverage – Zoning/posting Tuesday, May 19, 2009 16 Needs to be read from a distance with contrasting colors and shade-Night AND Day
Newspaper Advertising • Pros – Low cost – Broad reach – Effective coverage – Immediacy – Flexibility • Cons – Read or skimmed quickly – Usually seen by only reader per issue – Poor reproduction quality – Wasted coverage Tuesday, May 19, 2009 17 Most Popular restaurant News Ad Holidays; New Years Eve, Valentineʼs Day, Easter, Motherʼs Day, Fourth of July, Thanksgiving, Christmas
Magazine Advertising ★ Pros – life span – Several readers per issue – Can target specific audiences – Excellent reproduction quality ★ Cons – High cost – Long preparation time needed – Inflexibility – Some wasted coverage Tuesday, May 19, 2009 18 Wow! Maui as travel destination has over 6 different menu publications. Lots of advertising dollars being spent. You SHOULD get a 10% return on your investment!! One full page ad cost an average of $4000 for a full year, not including set up and photos. The cover and back costs a premium of $8,000-$10,000 per year
Radio Advertising • Pros – Potentially saturate an entire area – Low cost – Produced quickly and used immediately – Sponsorship – Drive time • Cons – Short life span – Audio only Tuesday, May 19, 2009 19 Radio is repetitive, lively but disappears quickly after itʼs heard DJ can ﬂub up your message Need to determine your station and demographic.
Television Advertising • Pros – Appealing presentation of sight and sound – Viewers retain message – Extensive coverage – Target market • Cons – Highest cost! – Long preparation time – Wasted coverage Tuesday, May 19, 2009 20 If you can afford it this is the way to go
Direct Mail Advertising • Pros – Audience selectivity – Flexibility – Personalized message – Easily stopped or started – Easily evaluated for effectiveness • Cons – High cost – “Junk mail” image Tuesday, May 19, 2009 21 Targets Shut Inʼs and Senior Citizens Use this for marketing lunch; many ofﬁces and businesses are locked in to an hour and are on a budget
Internet Advertising • One-on-one guest relationships • E-newsletters • Online reservations • Banner ads Tuesday, May 19, 2009 22 Fastest growing area in the world but yet to be exploited World wide 1.5 billion have access to internet China 23% Growing 1000% from 2000-2008 250 million US 73% 250 million http://www.internetworldstats.com/stats2.htm
PR and Publicity • Public Relation: – communicating favorable info about the operation to the public to create a positive impression – Word of mouth – Charity work • Publicity: – Free media coverage of an operation, its staff, or special property events by the media – Editorial page – Medium controls the message Tuesday, May 19, 2009 23 Promotional, Concierge, Participation in Events, Charity, Associations, Face time and Demonstrations, Teaching
Marketing Review • Explain marketing in terms of delivering guest- pleasing service • Describe the steps involved in developing a feasibility study and list the three types of ongoing marketing research • Describe the elements of a complete marketing plan, focusing on the roles of sales, advertising, PR, and publicity • Identify marketing tactics for noncommercial food service operation 24 Tuesday, May 19, 2009 24 F & B Marketing focuses on one main thing: repeat guest experiences. In order to do that... Identify market area characteristics, Evaluate the proposed site, Analyze competitors, Estimate demand, Project operating results Property Analysis, Competition Analysis, Market Analysis, Government Statistics and Data Media Coupons, Magazines, Radio, Newspaper, TV, Outdoor Signage, Internet, Direct Mail, Media Events/PR
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