Selling is probably the most important contributor to business health, even more important than products and services. It's a difficult art to master. So it pays to develop good mechanisms to support and guide the sales effort. Here are five "Best Practices" that can help sales managers and their staffs:
Create an Ideal Customer Profile
Develop this profile on customers with whom you have had success in the past. Detail not only the facts (demographics, company size, annual revenues, SIC codes), but the qualitative characteristics as well, those elements that represent the value they seek when doing business with your company.
Set Clear Expectations
Give your salespeople clear and quantifiable performance expectations for all stages of the sales process. Don't simply throw a quota and a territory map at them. Tell them you expect them to convert so many leads to suspects, suspects to prospects, prospects to contracts, contracts to repeat business. And follow up with them.
Track Performance and Share the Data
Stop managing your sales force by anecdote, those traditional sales meetings where each salesperson fills up time telling about why this or that deal hasn't closed yet. Instead, focus on collective performance against those expectations you laid out above. Build sales meetings around a review of the data. Now you're dealing with facts.
Work on the Process to Improve Results
If sales are down this month, don't panic. Instead, examine the underlying processes to see where the slowdown occurred and why. Maybe sales are down because there's an operational glitch, or an unexpected trend in the local market.
Give Great Support
Everybody likes nice bosses better than mean bosses, but great sales support means more than that. It means removing obstacles to performance wherever possible, smoothing the way, and leaving people alone when that's appropriate.
Thursday, December 9, 2010
Wednesday, December 8, 2010
The Changing Approval Process
Many decision-makers no longer have the ability to sign-off on the same level of expenses or purchases that they were once accustomed to. This has significant ramifications.
The ego issue. Picture yourself in the executive office, perhaps a VP of Sales or Marketing. Until last year you could approve any purchase under $20,000. Now, you need to get approval from a purchasing committee for any expense over $5,000. Although you understand the philosophy behind this policy, it is challenging to deal with because in your eight-year history with the company you have never made a poor buying decision.
The buying committee. You may now have to deal with buying committees, and if you're not careful, you won't even get the chance to meet them. That means the decision to use your product, service or solution could be vetoed.
No approval. Some purchases simply won't be approved because of the extent or nature of the expense. Even though your solution may benefit the company, the organization may choose not to move forward simply because they know they won't get approval for the expense. It's not fair but it is a fact of business.
Once again, this means that you need to ask more questions to uncover the approval process. Be sensitive to the decision-maker's position if you discover that they no longer have the authority to sign-off on your product or service. Look for ways to help them facilitate their decision.
The ego issue. Picture yourself in the executive office, perhaps a VP of Sales or Marketing. Until last year you could approve any purchase under $20,000. Now, you need to get approval from a purchasing committee for any expense over $5,000. Although you understand the philosophy behind this policy, it is challenging to deal with because in your eight-year history with the company you have never made a poor buying decision.
The buying committee. You may now have to deal with buying committees, and if you're not careful, you won't even get the chance to meet them. That means the decision to use your product, service or solution could be vetoed.
No approval. Some purchases simply won't be approved because of the extent or nature of the expense. Even though your solution may benefit the company, the organization may choose not to move forward simply because they know they won't get approval for the expense. It's not fair but it is a fact of business.
Once again, this means that you need to ask more questions to uncover the approval process. Be sensitive to the decision-maker's position if you discover that they no longer have the authority to sign-off on your product or service. Look for ways to help them facilitate their decision.
Tuesday, December 7, 2010
Daily Sales Tip: Keeping It Positive
The old sales axiom that people buy from people they like is true; buying is a very emotional experience. Having a negative attitude makes you less likeable and approachable as a salesperson. Sometimes the biggest sales challenges can be overcome with the proper attitude.
That said, how do you maintain a positive attitude when times are tough? Sure, it's easy to maintain a positive attitude when you're over quota and things are going well; anyone can do this. But a true sales professional maintains a positive attitude despite thier challenges and setbacks. The consummate sales professional knows that maintaining a positive attitude will help him to overcome adversity and achieve his objectives.
Here are 5 simple tips to maintain a positive attitude in difficult times:
1. Don't dwell on your losses. Realize that you will win some and lose some and the next opportunity is around the bend. Dwelling on the past keeps you from living in the present and achieving your goals.
2. Recognize that you bring value to your clients. It's more than your product or service. It's the benefit of doing business with YOU. Help your customers to understand why they should do business with YOU and not someone else.
3. Remember your successes. Realize that you can achieve excellence by repeating positive behaviors and actions. Pay attention to what you did in the past when you experienced success. Harness those behaviors.
4. Avoid time wasters. Don't waste your precious time on naysayers and negative thinking. Associate with those who have similar goals and ambitions. It's amazing what like-minded individuals can achieve when they combine forces.
5. Be genuine. By being genuine and putting others' needs before your own you will benefit from sales. Take the time to genuinely understand your clients' goals, fears and ambitions. It's your job to help them to succeed.
That said, how do you maintain a positive attitude when times are tough? Sure, it's easy to maintain a positive attitude when you're over quota and things are going well; anyone can do this. But a true sales professional maintains a positive attitude despite thier challenges and setbacks. The consummate sales professional knows that maintaining a positive attitude will help him to overcome adversity and achieve his objectives.
Here are 5 simple tips to maintain a positive attitude in difficult times:
1. Don't dwell on your losses. Realize that you will win some and lose some and the next opportunity is around the bend. Dwelling on the past keeps you from living in the present and achieving your goals.
2. Recognize that you bring value to your clients. It's more than your product or service. It's the benefit of doing business with YOU. Help your customers to understand why they should do business with YOU and not someone else.
3. Remember your successes. Realize that you can achieve excellence by repeating positive behaviors and actions. Pay attention to what you did in the past when you experienced success. Harness those behaviors.
4. Avoid time wasters. Don't waste your precious time on naysayers and negative thinking. Associate with those who have similar goals and ambitions. It's amazing what like-minded individuals can achieve when they combine forces.
5. Be genuine. By being genuine and putting others' needs before your own you will benefit from sales. Take the time to genuinely understand your clients' goals, fears and ambitions. It's your job to help them to succeed.
Monday, December 6, 2010
Guerilla Marketing...Great Example from NY Times Article
Marketers Discover Trucks Can Deliver More Than Food
When the Heavenly Mountain Resort in Lake Tahoe, Nev., wanted to promote its ski passes this season, it bypassed the usual advertising media like billboards, radio and print ads and instead chose a truck filled with snow cones driven by two improv actors to publicize its message.
For Heavenly, the idea to distribute snow cones from a truck was simple: "We're going to give you a little bit of the mountain," said Michael Chamberlin, the executive vice president and director of client services at BBDO San Francisco, which created the campaign for the resort.
That strategy -- pairing a brand’s message with of all things, a food truck -- has been increasingly employed in recent months, with major advertisers using trucks as rolling sandwich boards while advertising agencies issue the call to independent food truck operators to participate in brand-sponsored events.
Food trucks selling things like falafels and waffles have grown in popularity in cities like New York, Los Angeles and San Francisco, and advertisers now see them as a vehicle for delivering their message directly to consumers.
"All the companies that are involved in this understand the power of this guerrilla-type marketing, being on the street, being very hands-on with the consumer that's walking around," said Beth Lawrence, the chief marketing officer of La Cense Beef, whose La Cense Beef Burger Truck has been used in many events in Manhattan since the summer.
The challenge with buying traditional media, said John Wagnon, the vice president for marketing at Heavenly, one of the properties of the Vail Resorts group, is "paying for eyeballs of people who have no interest in what you're trying to sell."
The food truck campaign is the first assignment by Heavenly for BBDO San Francisco, part of the BBDO West unit of BBDO Worldwide, owned by the Omnicom Group.
The resort's truck, outfitted with iPads and large televisions showing skiing and snowboarding films, will promote a $379 ski season pass at locations around the San Francisco Bay Area through Dec. 15.
Visitors can buy a pass at the truck itself or they can collect a card and visit a Web site for more information. The actors driving the truck will also create video content that will be posted to a blog and Facebook page associated with the campaign.
"It's like a mobile billboard on steroids," Mr. Chamberlin said.
Ms. Lawrence said that La Cense Beef started getting calls from advertising agencies at the end of the summer and credited it to the media attention food trucks have gotten, including a mention in New York Magazine's list of 25 of its favorite food trucks in New York City. According to the 2011 Zagat New York City restaurants survey, 26 percent of respondents reported eating from gourmet food trucks while 40 percent expressed interest in trying them.
In November, the La Cense Beef Burger truck was hired by Team One, a division of Saatchi and Saatchi, for a private event on behalf of Lexus. In October, it was hired by IAC to participate in the Vimeo Festival + Awards event. In June, the 94x50 agency used the truck for a private event on behalf of Nike.
"They like the brand, they like the positioning and they like the fact that the meat is coming from the ranch," William Kriegel, owner and founder of La Cense Beef, said of the grass-fed beef used to make the hamburgers sold on the truck.
At the 11th annual New Yorker festival this fall, HSBC bank used six independent food trucks to promote its first sponsorship of the event.
The trucks -- Rickshaw Dumpling, Schnitzel & Things, Wafels & Dinges, Bistro, NYC Cravings and Van Leeuwen -- were wrapped almost entirely in an HSBC ad campaign and each featured a special dish created for the event. Rickshaw Dumpling, for example, created a Peking duck dumpling, while Van Leeuwen offered pumpkin ice cream to visitors.
HSBC customers who showed their bank cards at any of the trucks were given special treats like a free drink of Moroccan mint tea at the Bistro truck and a free scoop of ice cream on a waffle at Wafels & Dinges. HSBC also branded the napkins used in the trucks.
But some brands prefer to create their own food truck instead of hiring an independent operator.
To promote its new product, Heinz Dip & Squeeze Ketchup, the H.J. Heinz Company bought a used truck and added a custom kitchen that included double-stacked convection ovens, food warmers, sinks and a freezer. The truck was then branded with a custom wrapping that displayed the "Heinz Ketchup Road Trip" message along with the related Twitter handle and Facebook page address.
The company hopes to capitalize on the growing familiarity with food trucks, said Jessica Jackson, the group head of public relations and communications at Heinz North America. The redesigned ketchup packets were also a perfect fit for a food truck, Ms. Jackson said.
"Since it was really made for eating on the go, we wanted to create an environment where people could experience it on the go," she said.
The road trip began in mid-November in Pittsburgh, the company's hometown, spent the Thanksgiving holiday in New York City and will make its way to Philadelphia with a final stop in Dallas. At each stop, visitors get a free serving of Ore-Ida crinkle cut fries or Ore-Ida sweet potato fries and a packet of the Dip & Squeeze Ketchup.
The company will also give away promotional T-shirts to people who have participated in one of the social media parts of the campaign. For example, the first 20 people who arrive at the truck showing on their smartphone that they have "checked in" to the "Ketchup Road Trip" on Foursquare or who post their preference as "dippers" or "squeezers" on Facebook or use the Twitter handle @DipAndSqeeze to announce their preference are also eligible for a free T-shirt.
Most food trucks, corporate or not, use social media tools like Twitter to post their location to their followers, and now Zagat, the restaurant guide, has gotten into the game. In early November, Zagat announced a food truck Web site that features a map with the location of the food trucks that it partners with. They are also conducting a survey of the best food trucks in New York.
"Now we're starting to get calls about Christmas parties," said Ms. Lawrence, of La Cense Beef. "It's just going to continue to be on the rise."
(Source: The New York Times, 11/29/10)
When the Heavenly Mountain Resort in Lake Tahoe, Nev., wanted to promote its ski passes this season, it bypassed the usual advertising media like billboards, radio and print ads and instead chose a truck filled with snow cones driven by two improv actors to publicize its message.
For Heavenly, the idea to distribute snow cones from a truck was simple: "We're going to give you a little bit of the mountain," said Michael Chamberlin, the executive vice president and director of client services at BBDO San Francisco, which created the campaign for the resort.
That strategy -- pairing a brand’s message with of all things, a food truck -- has been increasingly employed in recent months, with major advertisers using trucks as rolling sandwich boards while advertising agencies issue the call to independent food truck operators to participate in brand-sponsored events.
Food trucks selling things like falafels and waffles have grown in popularity in cities like New York, Los Angeles and San Francisco, and advertisers now see them as a vehicle for delivering their message directly to consumers.
"All the companies that are involved in this understand the power of this guerrilla-type marketing, being on the street, being very hands-on with the consumer that's walking around," said Beth Lawrence, the chief marketing officer of La Cense Beef, whose La Cense Beef Burger Truck has been used in many events in Manhattan since the summer.
The challenge with buying traditional media, said John Wagnon, the vice president for marketing at Heavenly, one of the properties of the Vail Resorts group, is "paying for eyeballs of people who have no interest in what you're trying to sell."
The food truck campaign is the first assignment by Heavenly for BBDO San Francisco, part of the BBDO West unit of BBDO Worldwide, owned by the Omnicom Group.
The resort's truck, outfitted with iPads and large televisions showing skiing and snowboarding films, will promote a $379 ski season pass at locations around the San Francisco Bay Area through Dec. 15.
Visitors can buy a pass at the truck itself or they can collect a card and visit a Web site for more information. The actors driving the truck will also create video content that will be posted to a blog and Facebook page associated with the campaign.
"It's like a mobile billboard on steroids," Mr. Chamberlin said.
Ms. Lawrence said that La Cense Beef started getting calls from advertising agencies at the end of the summer and credited it to the media attention food trucks have gotten, including a mention in New York Magazine's list of 25 of its favorite food trucks in New York City. According to the 2011 Zagat New York City restaurants survey, 26 percent of respondents reported eating from gourmet food trucks while 40 percent expressed interest in trying them.
In November, the La Cense Beef Burger truck was hired by Team One, a division of Saatchi and Saatchi, for a private event on behalf of Lexus. In October, it was hired by IAC to participate in the Vimeo Festival + Awards event. In June, the 94x50 agency used the truck for a private event on behalf of Nike.
"They like the brand, they like the positioning and they like the fact that the meat is coming from the ranch," William Kriegel, owner and founder of La Cense Beef, said of the grass-fed beef used to make the hamburgers sold on the truck.
At the 11th annual New Yorker festival this fall, HSBC bank used six independent food trucks to promote its first sponsorship of the event.
The trucks -- Rickshaw Dumpling, Schnitzel & Things, Wafels & Dinges, Bistro, NYC Cravings and Van Leeuwen -- were wrapped almost entirely in an HSBC ad campaign and each featured a special dish created for the event. Rickshaw Dumpling, for example, created a Peking duck dumpling, while Van Leeuwen offered pumpkin ice cream to visitors.
HSBC customers who showed their bank cards at any of the trucks were given special treats like a free drink of Moroccan mint tea at the Bistro truck and a free scoop of ice cream on a waffle at Wafels & Dinges. HSBC also branded the napkins used in the trucks.
But some brands prefer to create their own food truck instead of hiring an independent operator.
To promote its new product, Heinz Dip & Squeeze Ketchup, the H.J. Heinz Company bought a used truck and added a custom kitchen that included double-stacked convection ovens, food warmers, sinks and a freezer. The truck was then branded with a custom wrapping that displayed the "Heinz Ketchup Road Trip" message along with the related Twitter handle and Facebook page address.
The company hopes to capitalize on the growing familiarity with food trucks, said Jessica Jackson, the group head of public relations and communications at Heinz North America. The redesigned ketchup packets were also a perfect fit for a food truck, Ms. Jackson said.
"Since it was really made for eating on the go, we wanted to create an environment where people could experience it on the go," she said.
The road trip began in mid-November in Pittsburgh, the company's hometown, spent the Thanksgiving holiday in New York City and will make its way to Philadelphia with a final stop in Dallas. At each stop, visitors get a free serving of Ore-Ida crinkle cut fries or Ore-Ida sweet potato fries and a packet of the Dip & Squeeze Ketchup.
The company will also give away promotional T-shirts to people who have participated in one of the social media parts of the campaign. For example, the first 20 people who arrive at the truck showing on their smartphone that they have "checked in" to the "Ketchup Road Trip" on Foursquare or who post their preference as "dippers" or "squeezers" on Facebook or use the Twitter handle @DipAndSqeeze to announce their preference are also eligible for a free T-shirt.
Most food trucks, corporate or not, use social media tools like Twitter to post their location to their followers, and now Zagat, the restaurant guide, has gotten into the game. In early November, Zagat announced a food truck Web site that features a map with the location of the food trucks that it partners with. They are also conducting a survey of the best food trucks in New York.
"Now we're starting to get calls about Christmas parties," said Ms. Lawrence, of La Cense Beef. "It's just going to continue to be on the rise."
(Source: The New York Times, 11/29/10)
Thursday, December 2, 2010
11 Restaurant Industry Trends to Watch For in 2011
Restaurant operators can't be certain about much for 2011, as recent improvements in guest traffic, same-store sales and hiring are far from guaranteed to continue. About the only thing they can expect as they hope for traction in the economy's wobbly recovery is that the industry will continue to look different than it does today.
In forecasting what changes may lie ahead, Chicago-based market research firm Technomic Inc. identified 11 restaurant industry trends for next year.
1. Action in adult beverages
Technomic predicts that as optimism grows in 2011, consumers will want to celebrate with some higher-end alcoholic drinks. As such, retro cocktails and high-end spirits may get more play at fine-dining and independent establishments, craft beers could gain in popularity against their mass-market counterparts, and fast-casual concepts could turn to alcohol as a way to differentiate themselves. Casual-dining chain Ruby Tuesday already has positioned itself to get ahead of this trend, offering $5 premium-well cocktails and craft beers as part of an expanded beverage program that debuted with a rebranding. There also are several smart-phone apps like Find Craft Beer and Happy Houred that will list nearby restaurants offering specialty microbrews.
2. Beyond bricks and mortar
Food trucks are poised to move beyond New York and Los Angeles into more U.S. cities. Not only will gourmet food trucks proliferate, Technomic said, but traditional restaurants also will begin using the tactic as a way to extend their brands into new areas or add revenue streams like catering. Chains like Qdoba, Sizzler, Dairy Queen and Gold Star Chili already have done this. Regulatory agencies in cities with a new food truck presence will be scrambling to keep up.
3. Farmers as celebrities
The era of the celebrity chef may soon give way to that of the star farmer. Look for more attention to be paid to producers and suppliers on menus across the nation as a growing back-to-the-source mentality takes hold in the industry, Technomic said. Farmers and producers may soon be high-profile spokesmen for restaurants and host more special events and dinners. At the chain level, Chipotle Mexican Grill and Domino's Pizza have made their sourcing integral to their marketing -- Chipotle with its "Food With Integrity" campaign and Domino's with its commercials taking place on a dairy farm.
4. Social media and technology: evolutionary spurt
Look for more restaurants to gain a competitive edge with new technologies and applications, including kiosks for ordering and displaying nutritional information, iPads containing wine lists, and hand-held devices for tableside payments. Widespread adoption of location-based social media has a lot of room for scale, indicated not only by megachains Starbucks and McDonald's piloting uses for Facebook Deals, but also by CKE Restaurants' development of its own location-based mobile app, Happy Star Rewards.
5. Korean and beyond
"The Korean taco -- an only-in-America synthesis of Korean-style fillings and a Mexican format -- signals the rise of Korean barbecue and Korean food in general," Technomic writes. While that item made famous by Los Angeles food truck Kogi Korean BBQ-to-Go has the potential to touch off a proliferation of street foods and small plates across the industry, other restaurant dishes may incorporate traditional Korean flavors like kimchee and short rib.
6. Frugality fatigue
Consumers who are able to treat themselves again in 2011 will do so -- meaning that restaurants with a few indulgent menu items or experiences could see an uptick in orders of high-margin and high-price-point dishes. This could spell opportunity not only for casual-dining chains to entice diners with more premium dishes like the Flavor-Loaded Steaks at Applebee's, but also for higher-end chains like Fleming's Prime and Morton's to attract new customers with their bar menus, as they've done throughout the downturn. Technomic also predicted that more gastropubs would pop up next year.
7. How low can you go?
On the other hand, customers will continue to demand everyday value when dining out, Technomic said. As part of any balanced-menu strategy, restaurants should have permanent value fixtures available, not just limited-time offers. In its most recent earnings call, quick-service chain Wendy's said its value-driven LTOs did well with marketing support, but dropped off when advertising was pulled back, which necessitated the reformulation and promotion of its latest everyday-value lineup, "My 99," with seven items for 99 cents.
8. Carefully calibrated brand action
More restaurant concepts will update brand positioning through remodels and new formats, Technomic predicted. Many chains have begun on that front already, beginning with the debut this month of a fast-casual café variant for family dining brand Denny's, which also foresees future growth in nontraditional locations on college campuses. In a move to bolster carryout sales, Bob Evans has added a "Taste of the Farm" grab-and-go area to five of its locations, and plans to remodel 30 to 35 more units over the next six months. McDonald's also plans to remodel hundreds of units this year and next, continuing its image update featuring highlights like the McCafe beverage lineup and free Wi-Fi in its stores.
9. Back to our roots
Consumers will continue to turn to comfort foods when dining out, Technomic projected, creating demand for traditional Southern foods, retro Italian favorites like meatballs, or gourmet updates to nostalgic favorites like doughnuts and popsicles. There also could be more opportunities for family-style service and family-size portions, like the fare offered at Italian dinnerhouse Buca di Beppo, especially if more families have reasons to celebrate in the new year.
10. New competition from C-stores
"Retailers have been encroaching on restaurant turf for some time," Technomic said, "but now the hottest action is among convenience-store operators upgrading their foodservice, where margins are 40 percent to 60 percent instead of the 5 percent typical for gas." Restaurants can prevent customer defection to C-stores by focusing on their differentiated menu items, ambience and service, Technomic said, while other can fight back by taking some of their signatures into grocery stores, as Starbucks, California Pizza Kitchen and P.F. Chang’s have done.
11. Healthful versus indulgent: The little angel says one thing, the little devil another
The balance that restaurants usually strike between healthful and not-so-healthful food items could get complicated in 2011 when many menu-labeling requirements take effect. One possible trend emerging from the new regulations could be an upswing in limited-time offers, which are exempt from nutritional data-disclosure requirements. Technomic also predicted more moves to reformulate entire menus with an eye toward health, like Taco Bell's recent test of a lower-sodium menu, and more menus advertised as under a certain number of calories, similar to Applebee's under-550-calorie lineup.
(Source: Nation's Restaurant News, 11/18/10)
In forecasting what changes may lie ahead, Chicago-based market research firm Technomic Inc. identified 11 restaurant industry trends for next year.
1. Action in adult beverages
Technomic predicts that as optimism grows in 2011, consumers will want to celebrate with some higher-end alcoholic drinks. As such, retro cocktails and high-end spirits may get more play at fine-dining and independent establishments, craft beers could gain in popularity against their mass-market counterparts, and fast-casual concepts could turn to alcohol as a way to differentiate themselves. Casual-dining chain Ruby Tuesday already has positioned itself to get ahead of this trend, offering $5 premium-well cocktails and craft beers as part of an expanded beverage program that debuted with a rebranding. There also are several smart-phone apps like Find Craft Beer and Happy Houred that will list nearby restaurants offering specialty microbrews.
2. Beyond bricks and mortar
Food trucks are poised to move beyond New York and Los Angeles into more U.S. cities. Not only will gourmet food trucks proliferate, Technomic said, but traditional restaurants also will begin using the tactic as a way to extend their brands into new areas or add revenue streams like catering. Chains like Qdoba, Sizzler, Dairy Queen and Gold Star Chili already have done this. Regulatory agencies in cities with a new food truck presence will be scrambling to keep up.
3. Farmers as celebrities
The era of the celebrity chef may soon give way to that of the star farmer. Look for more attention to be paid to producers and suppliers on menus across the nation as a growing back-to-the-source mentality takes hold in the industry, Technomic said. Farmers and producers may soon be high-profile spokesmen for restaurants and host more special events and dinners. At the chain level, Chipotle Mexican Grill and Domino's Pizza have made their sourcing integral to their marketing -- Chipotle with its "Food With Integrity" campaign and Domino's with its commercials taking place on a dairy farm.
4. Social media and technology: evolutionary spurt
Look for more restaurants to gain a competitive edge with new technologies and applications, including kiosks for ordering and displaying nutritional information, iPads containing wine lists, and hand-held devices for tableside payments. Widespread adoption of location-based social media has a lot of room for scale, indicated not only by megachains Starbucks and McDonald's piloting uses for Facebook Deals, but also by CKE Restaurants' development of its own location-based mobile app, Happy Star Rewards.
5. Korean and beyond
"The Korean taco -- an only-in-America synthesis of Korean-style fillings and a Mexican format -- signals the rise of Korean barbecue and Korean food in general," Technomic writes. While that item made famous by Los Angeles food truck Kogi Korean BBQ-to-Go has the potential to touch off a proliferation of street foods and small plates across the industry, other restaurant dishes may incorporate traditional Korean flavors like kimchee and short rib.
6. Frugality fatigue
Consumers who are able to treat themselves again in 2011 will do so -- meaning that restaurants with a few indulgent menu items or experiences could see an uptick in orders of high-margin and high-price-point dishes. This could spell opportunity not only for casual-dining chains to entice diners with more premium dishes like the Flavor-Loaded Steaks at Applebee's, but also for higher-end chains like Fleming's Prime and Morton's to attract new customers with their bar menus, as they've done throughout the downturn. Technomic also predicted that more gastropubs would pop up next year.
7. How low can you go?
On the other hand, customers will continue to demand everyday value when dining out, Technomic said. As part of any balanced-menu strategy, restaurants should have permanent value fixtures available, not just limited-time offers. In its most recent earnings call, quick-service chain Wendy's said its value-driven LTOs did well with marketing support, but dropped off when advertising was pulled back, which necessitated the reformulation and promotion of its latest everyday-value lineup, "My 99," with seven items for 99 cents.
8. Carefully calibrated brand action
More restaurant concepts will update brand positioning through remodels and new formats, Technomic predicted. Many chains have begun on that front already, beginning with the debut this month of a fast-casual café variant for family dining brand Denny's, which also foresees future growth in nontraditional locations on college campuses. In a move to bolster carryout sales, Bob Evans has added a "Taste of the Farm" grab-and-go area to five of its locations, and plans to remodel 30 to 35 more units over the next six months. McDonald's also plans to remodel hundreds of units this year and next, continuing its image update featuring highlights like the McCafe beverage lineup and free Wi-Fi in its stores.
9. Back to our roots
Consumers will continue to turn to comfort foods when dining out, Technomic projected, creating demand for traditional Southern foods, retro Italian favorites like meatballs, or gourmet updates to nostalgic favorites like doughnuts and popsicles. There also could be more opportunities for family-style service and family-size portions, like the fare offered at Italian dinnerhouse Buca di Beppo, especially if more families have reasons to celebrate in the new year.
10. New competition from C-stores
"Retailers have been encroaching on restaurant turf for some time," Technomic said, "but now the hottest action is among convenience-store operators upgrading their foodservice, where margins are 40 percent to 60 percent instead of the 5 percent typical for gas." Restaurants can prevent customer defection to C-stores by focusing on their differentiated menu items, ambience and service, Technomic said, while other can fight back by taking some of their signatures into grocery stores, as Starbucks, California Pizza Kitchen and P.F. Chang’s have done.
11. Healthful versus indulgent: The little angel says one thing, the little devil another
The balance that restaurants usually strike between healthful and not-so-healthful food items could get complicated in 2011 when many menu-labeling requirements take effect. One possible trend emerging from the new regulations could be an upswing in limited-time offers, which are exempt from nutritional data-disclosure requirements. Technomic also predicted more moves to reformulate entire menus with an eye toward health, like Taco Bell's recent test of a lower-sodium menu, and more menus advertised as under a certain number of calories, similar to Applebee's under-550-calorie lineup.
(Source: Nation's Restaurant News, 11/18/10)
Wednesday, December 1, 2010
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