how ihop's new menu design gets customers to spend more...“guests were making additional...

Bloomberg Businessweek Companies & Industries http://www.businessweek.com/articles/2014-01-10/how-ihops-new-menu-design-gets-customers- to-spend-more How IHOP's New Menu Design Gets Customers to Spend More By Venessa Wong January 10, 2014 IHOP has a new menu, and now customers are spending more. That’s not a coincidence: The new menu was carefully designed to encourage diners to order more. It’s like a Jedi mind trick that gets customers to order a side of bacon. According to DineEquity ( DIN) executives, the redesign, introduced in April and in place across the country by June, is responsible for the restaurant’s recent sales boost. “The new menu’s improved layout … prompted guests to trade up and also helped to increase the sale of additional items, such as appetizers,” said Julia Stewart, DineEquity’s chief executive, during an October earnings call. With an “expert in menu creative development,” whom the company declined to name, IHOP developed a new layout based on customer feedback in tests. We asked Natalia Franco, the chain’s senior vice president of marketing and culinary, to dissect the art of this particular upsell. How IHOP's New Menu Design Gets Customers t... http://www.businessweek.com/printer/articles/17... 1 of 5 01/12/2014 10:33 PM

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Page 1: How IHOP's New Menu Design Gets Customers to Spend More...“Guests were making additional purchases and self-selecting higher-priced items that may not have been noticed before,”

Bloomberg Businessweek

Companies & Industries

http://www.businessweek.com/articles/2014-01-10/how-ihops-new-menu-design-gets-customers-to-spend-more

How IHOP's New Menu Design GetsCustomers to Spend MoreBy Venessa Wong January 10, 2014

IHOP has a new menu, and now customers are spending more. That’s not acoincidence: The new menu was carefully designed to encourage diners toorder more. It’s like a Jedi mind trick that gets customers to order a side ofbacon.

According to DineEquity (DIN) executives, the redesign, introduced in April andin place across the country by June, is responsible for the restaurant’s recentsales boost. “The new menu’s improved layout … prompted guests to trade upand also helped to increase the sale of additional items, such as appetizers,”said Julia Stewart, DineEquity’s chief executive, during an October earningscall.

With an “expert in menu creative development,” whom the company declined toname, IHOP developed a new layout based on customer feedback in tests. Weasked Natalia Franco, the chain’s senior vice president of marketing andculinary, to dissect the art of this particular upsell.

How IHOP's New Menu Design Gets Customers t... http://www.businessweek.com/printer/articles/17...

1 of 5 01/12/2014 10:33 PM

Page 2: How IHOP's New Menu Design Gets Customers to Spend More...“Guests were making additional purchases and self-selecting higher-priced items that may not have been noticed before,”

“Guests were making additional purchases and self-selecting higher-priceditems that may not have been noticed before,” Stewart said during a conferencecall.

How IHOP's New Menu Design Gets Customers t... http://www.businessweek.com/printer/articles/17...

2 of 5 01/12/2014 10:33 PM

Page 3: How IHOP's New Menu Design Gets Customers to Spend More...“Guests were making additional purchases and self-selecting higher-priced items that may not have been noticed before,”

“The challenge is real estate. We need space for pictures, because that drivesour appeal,” says Franco.

How IHOP's New Menu Design Gets Customers t... http://www.businessweek.com/printer/articles/17...

3 of 5 01/12/2014 10:33 PM

Page 4: How IHOP's New Menu Design Gets Customers to Spend More...“Guests were making additional purchases and self-selecting higher-priced items that may not have been noticed before,”

IHOP gets a lot of visits from families and boomers, who get more attention inthe new menu. “There are items meant to retain that loyal consumer base,”Franco says.

How IHOP's New Menu Design Gets Customers t... http://www.businessweek.com/printer/articles/17...

4 of 5 01/12/2014 10:33 PM