The 7 Deadly Sins of Restaurant Marketing (And How to Avoid Them)
According to Cornell University and the National Restaurant Association 60 percent of restaurants fail within the first three years of operation.
After five years, that failure rate jumps to as high as 75 percent.
Running a restaurant is a high-risk endeavor. And, as with other high-risk investments, when it goes right, it pays handsomely. Some of the more successful chains can see average net profits approaching or even surpassing 30 percent of sales. That’s a figure any restaurant owner would love to see in his or her balance book.
So what makes some restaurants so much more successful than others?
Well, a ton of factors. But one of those is marketing. Many restaurateurs know business and they know food. But if they don’t know marketing, they’re going to be at a disadvantage. Many of them waste a ton of money on marketing, simply because they don’t know how to do it to best increase their restaurants’ chances of success.
Especially in a restaurant’s early days, when profit margins are tiny--if not nonexistent--there’s simply no money to waste. You have to market your restaurant, and you have to spend some money to do that.
Here’s how to make sure you aren’t just throwing cash away with your restaurant marketing plan.
You’ve gotta spend money to make money
Is that old adage true?
In the case of marketing your restaurant the correct way, yes.
In 2016, The National Restaurant Association reported the average restaurant marketing budget was around 3 percent of total annual revenues. But some experts recommend going up to 10 percent. Ultimately, you have to make a choice about how much you’re going to spend. But if you invest your marketing budget wisely, you should see returns from it in the form of more customers and increased revenue. Keep that in mind as you decide where in the 3-10 percent range you want to fall.
Of course, making the most out of your marketing budget will be easier if you avoid all the common ways restaurants tend to waste theirs. Read on for all the “do’s” and “do not’s” you need to know.
Mistake #1: Not having a brand
Your brand isn’t your restaurant’s name. It isn’t your color scheme. It isn’t your menu or your social media profiles. It isn’t even your chef and staff, though they can certainly contribute to your brand.
Restaurants that waste money on marketing haven’t even mastered Marketing 101: Knowing their brand.
The solution: Know your brand
Your brand is the emotional connection between your restaurant and your audience, which is made up of current, future, and past customers.
Basically, you create your brand by putting materials in front of your audience that elicits the emotional response you want people to have when they think about or visit your restaurant. That means you need a deep understanding of what your restaurant is, what it stands for, what it does well and what it should never do — and you should have that understanding from day one.
Mistake #2: Talk is cheap
A huge mistake restaurants make when it comes to marketing is assuming that word of mouth is going to get the job done.
Don’t get us wrong — word of mouth can be a powerful marketing tool, since new customers are more likely to act on the recommendation of a past or existing customer than they are on an ad. While that much is true, though, a marketing strategy needs to be much, much more than just word of mouth.
The solution: Have a strategy
A marketing plan is just that: a plan. It should be carefully thought out and constructed, and it should include comprehensive goals and measurable benchmarks by which you can see what’s working and what isn’t. And on that note, here’s the next mistake restaurants tend to make.
Mistake #3: Not knowing how to measure success… or failure
Having a marketing plan is more than just setting goals. You need to be able to measure your success to see if you’re actually hitting those goals. Too many companies set vague goals like “increase brand awareness,” and then have no way of knowing whether their marketing plan is successful or not.
The solution: Create clear benchmarks for success
Instead of vague goals, make them comprehensive and specific, like “gain 1,000 new Twitter followers each quarter.” Then create a plan with steps that will work specifically toward achieving that goal, create a budget for the marketing plan, and implement it.
Also be sure to track the impact each marketing goal has on your profits.
Mistake #4: Staying offline
Have you ever planned on going to a restaurant, then gone online to look for information like its hours or location and been unable to find it? How annoying, right?
Sure, you could call and ask. But more likely you just chose a different restaurant.
It’s 2018, and your restaurant needs a website. Restaurants that aren’t online are missing out on customers searching for menus, hours, reservations and other information, who may just go elsewhere when they find that information isn’t readily and conveniently available.
The solution: Get a website. ASAP.
Building, hosting and maintaining a website is relatively cheap, especially with the variety of apps and restaurant-specific tech tools that now exist to help you do it. And no matter what other information you decide to include online, post your menu, and optimize it for mobile viewing.
Full Service Restaurant News found that 80 percent of customers want to see a menu online before they commit to a restaurant, and 62 percent were less likely to choose a restaurant if they could not easily view its menu on a mobile device.
End of the world. Who you saving?— Wendy's (@Wendys) May 16, 2018
Mistake #5: Being anti-social
In our tech-savvy world, “anti-social” has a whole new meaning.
Restaurants frequently don’t take advantage of social media like they should, and thus waste money on social marketing that isn’t driving traffic, attraction customers, or increasing profits. And just because someone knows how to post on Facebook, Twitter and Instagram doesn’t make them a social media marketer.
Many agencies that offer social media management will keep your pages updated and do little else, meaning restaurants sink hundreds of dollars (or more) each month into a service that isn’t offering any ROI.
The solution: Invest in a qualified social media marketer
If your social media marketing efforts aren’t bringing in daily customers from Facebook, Instagram, Twitter and other social media sites, fire them immediately. Investing in a qualified social media market will take more money upfront, but they’ll know how to put your social media to good use, like by using image posts as often as possible. Increasingly, online communication is becoming more visual.
Think about how you feel when you see a photo of a juicy cheeseburger dripping with condiments, rather than just reading a message that a burger is the day’s special. While you’re investing in your social media presence, invest in high-quality photos of your food and interior, too. You’ll definitely use them.
Mistake #6: Not soliciting reviews
If a customer is happy with his or her experience at your restaurant and you’re not asking for a positive review, you’re missing a huge opportunity.
According to a National Restaurant Association study, 53 percent of millennials and 47 percent of frequent full-service customers say that online reviews play a part when they’re choosing where to eat out. And that same study also showed that 61 percent of consumers have read online reviews for restaurants, more than any other industry. Reviews matter.
The solution: Ask happy guests for a favor
If guests had a good experience at your restaurant, chances are they won’t mind being asked to leave a review on Yelp, Trip Advisor or Google. Make it even easier for them by providing a tableside tablet all ready for them to enter their five-star experience on one of those sites.
Mistake #7: Investing in the wrong places
How effective your marketing strategy is actually depends a lot on how and where you invest your marketing budget. Many restaurants advertise through traditional mass media channels like newspaper or TV ads, and that’s another mistake.
The solution: Focus on new media
Seventy-two percent of all internet users around the globe are active on social media, which means advertising there is likely to get a lot of eyes compared to declining media like cable TV and newspapers.
Online opportunities like SEM/SEO, mobile marketing and viral marketing should be focused when you’re planning campaigns. And in order to stay competitive, you should be directing the bulk of your marketing budget toward new media, rather than traditional marketing outlets.
While opening a restaurant involves a lot of risk, it also comes with the opportunity for a lot of reward. By picking the right concept and managing it well, you could see your investment paid off quickly, and even returning residual cash flow.
Avoiding these marketing mistakes will help give your restaurant an even greater chance at success.