Another look at advertising

Yet another look at how hospitality businesses can get better value from their marketing activity.

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It’s an interesting exercise to cast your eye over our newspapers and hospitality magazines and look at the advertising for restaurants and other hospitality businesses with a critical eye. I continue to be amazed at the amount of money that gets wasted with ill-conceived hospitality advertising, most of which appears to me to be a knee-jerk reaction to poor trade.

Many of the ads I see we would classify as ‘we’re here’ ads, in that they are usually of a variety that proclaims the name of the restaurant and tells you they are open for lunch and dinner Tuesday to Sunday, followed by contact phone number. What could possibly be wrong with that? ’Hello, we’re here; come and throw money at us!’

The first issue that arises in my mind when I see ads of this kind is that they will probably attract people to the restaurant when the owner really does not need them or want them. Normally, generic advertising will attract people at the typically peak periods of the week such as Friday or Saturday night, when the restaurant or cafe is normally full. The net result of this kind of advertising is that it ends up annoying people who react to the advertising at traditional dining- out times of the week and are then told that the place is fully booked.

I have always believed that generic advertising is the province of large corporations who may wish to place a brand name into the collective conscious of the public. Small businesses that do not have large advertising budgets should carefully target their marketing efforts primarily at times of the week where they are trading below breakeven point, rather than trying to make a general statement to the public.

For example, Mondays are a quiet day in almost every restaurant. It would be a legitimate marketing target to either offer some sort of discount or bonus promotion on Mondays at lunchtime or dinner time in order to attract new customers or move customers away from the busy times; or create a particular event such as an accountants’ networking lunch or a doctors’ networking lunch on the Monday lunchtime to attract people to the restaurant where there is no normal, natural market.

The general objective should be to identify times of the week where the business is trading below breakeven point and target these times to special marketing efforts designed to attract people. In other words, it should be a primary marketing aim to make sure that the business is trading profitably for the entire week. If you trade unprofitably one day you usually have to trade profitably the following day to pay back the losses from the previous day, with the net result that you trade for two days as a charity to your staff and the dining public without producing any benefit for yourself.

The other common issue that I see with restaurant and cafe marketing is that the perceived need for marketing support by the owner or manager is usually the symptom of internal issues within the business that are causing customers to choose to frequent other businesses. I have always believed that if you run your business at a high enough standard and with absolute consistency, the public will come and they will tell their friends how wonderful you are. In other words, if you operate your business well enough you should not need to spend money on marketing because word-of-mouth marketing would have been effective.

I have often found that it is necessary to accurately measure customer perceptions in a restaurant or cafe before spending any money on marketing, in order to identify any issues which may be at the root of poor trade or a lack of customer loyalty. I think it is folly to throw money at advertising in order to win more customers before you are reasonably guaranteed that those customers will be impressed enough to lock in to long-term loyalty to your business. Many of the businesses we have dealt with in the past as have spent substantial amounts of money ‘buying’ customers only to replace customers they have lost due to substandard internal performance. It’s a lot cheaper to address the internal performance issues than it is to keep buying customers to replace the ones you’ve lost.

If you have spent a substantial amount on marketing in the last year and have not sustained growth in customer numbers, then either your advertising is ineffective, or you are attracting customers who choose to only come once because they perceive you are not good enough to transfer their loyalty from another business to yours. Perhaps it’s time for a bit of introspective assessment.

Another common issue that I perceive is the placement of very expensive advertising in daily and regional newspapers which have a distribution across a 600km radius, when the trading radius of the particular restaurant or cafe is a relatively small 5km circle. To put it another way, advertising in a daily newspaper is casting your message to many, many people who are so far away from you they are never going to be potential customers. It would be far wiser to concentrate your advertising messages within that radius from which 90% of your customers already come. For example, for the cost of a decent newspaper advertisement you may be able to distribute 3000 fridge magnets or spice samples to targeted postcodes around your restaurant or cafe. I know which would bring the most benefit.

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