7.1 Review

What is a market? ◦ Customers

What is marketing? ◦ A way of communicating a message to a market

Is there a difference between marketing and advertising? ◦ Advertising is one part of marketing – marketing is much bigger than just advertising

Contemporary Marketing Mix Marketing Activity for Restaurants

Product-service mix ◦ Food and services offered to customer

Presentation mix ◦ Elements that make the operation look unique(color,

lighting, furniture, decoration, uniforms, etc…)

Communication mix ◦ Ways an operation tries to communicate with desired

customer.

SWOT Analysis – for understanding current

situations and looking for new opportunities.

S W O T Strengths Weaknesses Opportunities Threats

Where does this place

excel

Places to improve

(boring menu, dirty facilities, poor service, poor reputation)

Ways to increase

revenues or decrease

costs (delivery, take out,

kid’s menus, volume discounts from

supplier)

Factors outside the operation that could decrease

revenues or increase

costs (competition, product

cost, road construction)

7.2 Market Analysis, Identity and

Communication Chapter 7

Foundations of Restaurant Management and Culinary Arts

Market Research Methods

4 Basic Methods Marketers Use to Gather Research ◦ Experimental Method

◦ Observational Method

◦ Survey Method

◦ Sampling Method

4 Methods to Gather Research

#1 Experimental Method

◦ Try out a product for a limited time or with a limited group of people

◦ If response is favorable, operation might think about using product on larger scale

◦ If product is not well received, operation knows that more work will be required

4 Methods to Gather Research

#2 Observational Method

◦ Observing how customers react in a natural setting toward a product

◦ Example: manager tells service staff to present daily special in 3 different ways and record which was most successful

4 Methods to Gather Research

#3 Survey Method

◦ Marketer gathers information using questionnaires

◦ Can administer by telephone, email or feedback cards presented tableside

◦ Often they offer an incentive (coupon for free dessert)

4 Methods to Gather Research

#4 Sampling Method

◦ Testing a product with a specific small group of people, sometimes called a focus group

◦ REMEMBER- MARKETING STRATEGIES ARE GUIDED BY RESEARCH RESULTS

Market Segmentation

Target Market ◦ People an operation intends to pursue as customers

Every operation should be customer driven.

Customer Driven ◦ Making sure that satisfying all needs and wants of the customer drives the market strategy

Market Segmentation

Mass Marketing Treats everyone in the market as having the same

needs and wants

Target Marketing Treats people as different from each other and tries

to make a focused appeal to a distinct group of customers

Identifying a target market enables an operation to

avoid mass marketing and focus on a target market

Market Segmentation

Market Segmentation ◦ When marketers break down a large market into smaller groups of similar individuals that make up the market

Like looking at the market through a microscope to see what parts make up the whole

Segmenting will help identify target demographics in any given location

Market Segmentation

Demographics- ◦ Refers to the ways in which researchers categorize or group people

◦ Can be done in any number of ways

4 Basic Ways to Segment the Market

Demographic Segmentation ◦ Gender, ethnicity, marital status, income, size of

household

Geographic Segmentation ◦ Where consumers live, work, and transportation

Product Usage Segmentation ◦ Lots of coffee houses in area, add desserts that have

coffee flavor

Lifestyle Segmentation ◦ Activities, hobbies, interests

Creating a Market Identity

Positioning- ◦ Creating within the marketplace a clear, specific identity for both a product and the operation that offers that product.

◦ Three steps to positioning

1. Identify ways to differentiate the operation within the market and create a unique identity

2. Select the right mix of differentiating aspects

3. Communicate the chosen identity to a specific target market

Differentiating an Operation

There are many methods to position your identity:

◦ Product Unique items or traditional items in a unique way

◦ Physical Appearance/Aesthetics Use the actual appearance to create an image

◦ Service How will the service staff be dressed? Delivery?

◦ Location Steakhouse in area with lots of vegetarians? Not good idea.

◦ Image Decide on image first, then create products and services to work

toward that image

WAYS TO ATTRACT CUSTOMERS

Specials, such as “buy 1 get 1 free”

Signature items, such as special desserts or “secret”

recipes

Frequent shopper cards that offer discounts or other incentives

Themes, both as operation-wide celebrations or special events

Merchandising techniques at the table such as unique garnishing or flambe

Educational promotions such as wine or cheese tastings

Creating an Identity

Selecting the Right Mix ◦ Decide the best route to take

◦ Finding the right mix takes a lot of time and research

Communicating the Chosen Identity ◦ The message needs to be clear

Market Communicators

Promotional Mix: ◦ The way a company communicates with an operation’s market

◦ Can consist of any or all of the following:

Advertising

Sales Promotions

Personal Selling

Public Relations

Direct Marketing

Market Communicators

Advertising Paying to promote an operation’s products, services

or identity ◦ Can be conducted through TV, radio, newspapers,

internet

◦ Effective ads can be powerful tools

Sales Promotions Limited, or short-term incentives to entice

customers to patronize an operation ◦ Happy hour at Sonic, Kids Eat Free, Half price

appetizers

Market Communicators

Personal Selling Well trained service staff

◦ Professionalism, politeness, efficiency

Public Relations The process by which an operation interacts with the

community at large ◦ Sponsoring little league teams

Direct Marketing Making an effort to connect with a certain segment of the

market ◦ Direct mailing or emails, telephone calls, tableside

feedback

Sales Promotions

Sales Promotions: Provide special incentives for customers to

patronize an operation. ◦ There are many types, but all are designed to

give customers the extra “boost” to get them into the operation or to get them to purchase certain items

They are the focus of advertising because they

are only useful when customers know about them

Types of Sales Promotions

Special Pricing ◦ Specials, deals, coupons

Frequent Shopper Program ◦ Free food items or substantial discounts, Cafe Rio

Premiums ◦ Free or reduced price merchandise, pen or cup

Special Events ◦ One time or periodic occasions

Samples ◦ Free tastes of food items, Sams Club

Contests and Sweepstakes ◦ Games and other programs that involve customer

and provide a prize

Typical Promotional Materials

Signage Menu boards, directional signs

Flyers Paper notices

Premiums Token gifts or giveaway items, pens, toys, mugs, t-

shirts

Carryout and Door Hanger Menus Paper menus, door hanger menus for doorknobs

Typical Promotional Materials

Apparel and Branded Merchandise ◦ Name and/or logo on t-shirts, mugs, pencils, stuffed animals

Point-of-Purchase (POP) materials ◦ Display items near the point of purchase where customers make their decision about what to buy.

Typical Promotional Materials

Merchandising Materials Table tents and other items in the restaurant

Direct Mail Mass mailing of coupons, menus, etc.

Email Electronic mail targeted to a particular market

Complementary Promotions 2 or more sponsors develop complementary

promotional materials (restaurant gives free tickets to a sports event, and sports event gives free appetizer at restaurant)

Public Relations

Public Relations ◦ Purpose is to generate positive public publicity

Publicity ◦ The attention the an operation receives

Community Relations ◦ Involve interacting with the people in the local area to create awareness of and trust for an operation

Benefits of Public Relations

Create a positive image within the community

Building credibility with the community

Building relationships with other community leaders

Generating positive publicity

Promoting the restaurant

Public Relations

Media Relations ◦ Relationships that marketers maintain with the media outlets

Newspapers, magazines, TV, and radio

Press Release ◦ A brief presentation of promotional info written to sound like a news article

◦ A well written press release presents marketing info as news

Public Relations

Press Kit A packet of info given to media representatives

to answer questions they might have about a business or organization ◦ Folder containing the following: General info about the organization Menus News articles Awards Photos Operation’s mission or goals Contact info