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Marketing. Chapter 7 Foundations of Restaurant Management and Culinary Arts. 7.1 Introduction to Marketing. Market: A group of people who desire a product or service Marketing: The process of communicating a business’s message to it’s market. Introduction to Marketing. Advertising .

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Marketing

Marketing

Chapter 7

Foundations of Restaurant Management and Culinary Arts



Introduction to marketing

Introduction to Marketing


Advertising vs marketing

Advertising

Marketing

  • Just one component of a successful marketing strategy

  • Determining what products and services to offer

  • How to position them in the marketplace

  • How to promote them to buyers

  • How to price them

  • How to get these to the buyers

Advertising vs. Marketing


Marketing functions

Marketing Functions


Current business operations

  • Marketing drives the operation

  • An operation must:

    • Determine customer needs and wants

    • Determine the costs, prices, and profitability of products and services before beginning to produce them

    • Organize all aspects to provide what customers want

Current Business Operations


Basic marketing concepts

Basic Marketing Concepts


The new model

The NEW Model


Product service mix

  • All of the food and services offered to customers creating, developing and selling a product

  • Restaurants can often gain a competitive edge by offering a greater variety of services with better efficiency

  • Delivery, Take-out Service, Curbside Take-out

Product Service Mix


Presentation mix

Presentation Mix


Communication mix

Communication Mix


Market trends

Market Trends


Marketing plan

Marketing Plan


Marketing plan1

  • Step 1- Research the Market sell a product or service to a specific market.

    • Know the ins and outs of the market and what you’re up against

    • Gather information

    • Know strengths and weaknesses of your own operation

Marketing Plan


Marketing plan2

Marketing Plan


Marketing plan3

  • Step 3- Develop a Marketing Strategy sell a product or service to a specific market.

    • Brainstorm ways to achieve objectives

    • It’s helpful to come up with a variety of different strategies and then evaluate each

Marketing Plan


Marketing plan4

Marketing Plan


Marketing plan5

  • Step 5- Evaluate/Modify the Action Plan sell a product or service to a specific market.

    • This stage is an ongoing process of monitoring actions and gauging how successful they are

    • Is the plan working? Are there ways it is missing the mark? What can we be doing better? How can this be improved?

Marketing Plan


Swot analysis

SWOT Analysis


Swot analysis1

  • Strengths sell a product or service to a specific market.

    • List all strengths of the operation- areas where it excels

      • Well trained Staff

      • Good location

      • Well kept facilities

      • High food quality

SWOT Analysis


Swot analysis2

  • Weaknesses sell a product or service to a specific market.

    • Identify weaknesses so they can be eliminated or even turned into strengths

      • Boring Menu

      • Dirty facilities

      • Limited abilities or resources

      • Poor service

      • High staff turnover

      • Poor reputation

SWOT Analysis


Swot analysis3

  • Opportunities sell a product or service to a specific market.

    • Areas where the operation could increase revenues or decrease costs

      • Launching a delivery or take-out service

      • Recognizing weak competition

      • Gaining volume or discount from a supplier

SWOT Analysis


Swot analysis4

  • Threats sell a product or service to a specific market.

    • Factors outside the operation that could decrease revenues or increase costs

    • Identifying threats helps control them

      • Increased competition

      • Increased taxes

      • Increased costs of certain products

      • Road construction

SWOT Analysis


7 2 market analysis identity and communication

7.2 Market Analysis, Identity and Communication sell a product or service to a specific market.


Market research methods

Market Research Methods


4 methods to gather research

  • #1 Experimental Method sell a product or service to a specific market.

    • 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


4 methods to gather research1

  • #2 Observational Method sell a product or service to a specific market.

    • 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


4 methods to gather research2

  • #3 Survey Method sell a product or service to a specific market.

    • 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 methods to gather research3

  • #4 Sampling Method sell a product or service to a specific market.

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

    • REMEMBER- MARKETING STRATEGIES ARE GUIDED BY RESEARCH RESULTS

4 Methods to Gather Research


Market segmentation

Market Segmentation


Market segmentation1

  • 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 segmentation2

  • 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


Market segmentation3

Market Segmentation


4 basic ways to segment the market

  • Demographic Segmentation categorize or group people and can be done in any number of ways

    • 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, interestes

4 Basic Ways to Segment the Market


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

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

      • Select the right mix of differentiating aspects

      • Communicate the chosen identity to a specific target market

Creating a Market Identity


Differentiating an operation

  • There are many ways to do this specific identity for both a product and the operation that offers that product.

    • 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

Differentiating an Operation


Ways to attract customers

  • Educational Promotions such as wine tastings specific identity for both a product and the operation that offers that product.

  • 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

WAYS TO ATTRACT CUSTOMERS


Creating an identity

  • Selecting the Right Mix specific identity for both a product and the operation that offers that product.

    • 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

Creating an Identity


Market communicators

Market Communicators


Market communicators1

  • 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


Market communicators2

  • Personal Selling-well trained service staff. services or identity

    • 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

Market Communicators


Sales promotions

  • Sales Promotions: provide special incentives for customers to patronize an operation.

    • There are many types

    • 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

Sales Promotions


Types of sales promotions

  • Special Pricing to patronize an operation.

    • 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

Types of Sales Promotions


Typical promotional materials

  • Signage- menu boards, directional signs to patronize an operation.

  • 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


Typical promotional materials1

Typical Promotional Materials


Typical promotional materials2

  • 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)

Typical Promotional Materials


Public relations

Public Relations


Benefits of public relations

Benefits of Public Relations


Public relations1

Public Relations


Public relations2

Public Relations


7 3 the menu as a marketing tool

7.3 The Menu As A Marketing Tool to answer questions they might have about a business or organization


Importance of a menu

  • A menu serves two purposes: to answer questions they might have about a business or organization

    • Planning

    • Communication

  • Planning- the menu gives an operation an end goal to work toward

  • Communication- informing customers, selling products, and creating identity

Importance of a Menu


Menu types

  • A la carte (AH le CART) to answer questions they might have about a business or organization

  • Du juor (doo-ZHEUR)

  • Cyclical

  • Limited

  • Fixed

  • California

  • Prix Fixe (PREE FIX)

  • Table d’hote (tah-buhl DOHT)

Menu Types


Menu types1

Menu Types


Menu types2

Menu Types


Menu types3

  • Fixed Menu- offers the same items everyday period of time

    • Customers know what to expect

    • Sometimes they supplement with a de jour menu to offer variety

  • California Menu- lists all meals available at any time of day

    • Diners that are open 24 hours often use california menu

Menu Types


Menu types4

  • Prix Fixe Menu- opposite of an a la carte menu, offers multiple menu items at one price

    • Choice of appetizer, full entree with sides, and dessert for one price

  • Table d’hote menu- similar to prix fixe menu, bundles various menu items into one package

    • Often offered at banquets

Menu Types


Organizing a menu

  • Often organized by the order of courses multiple menu items at one price

    • Appetizers

    • Soups

    • Salads

    • Sandwiches (can be offered before or after salads)

    • Entrees

    • Vegetables

    • Desserts

    • Beverages

  • Variations depend on what an operation offers and the image it wants to promote

    • An Italian restaurant might offer a pasta course separate from the rest of the entrees

Organizing a Menu


Creating a menu

Creating a Menu


Creating a menu1

  • Planning operation

    • Managers must keep the following in mind:

      • Physical Layout of the Facility

        • Size of storage, service and dining areas

      • Skill of Personnel

        • Operation’s personnel must fit the menu that planners create

      • Availability of Ingredients

        • How cost efficient are items to produce

      • Target Market’s Wants and Needs

        • Management can never forget who the operation is supposed to be serving

      • Target Market’s Expectations

        • Consistency is important

      • Profit Margin

        • Planners should create the menu with profitability in mind throughout the entire process

Creating a Menu


Creating a menu2

  • Designing operation

    • Designers must consider the following elements when laying out a menu:

      • Medium

        • Paper, menu boards, spoken menu

      • Layout

        • How it is categorized and sequenced

        • It can help further an operation’s identity and work to sell menu items at the same time

      • Color

        • Designers need to think about the feeling they want customers to get when considering the operation

      • Font

        • Different fonts have different connotations

      • Art

        • Art can say a lot about an operation

Creating a Menu


Pricing the menu

  • A critical process for any operation operation

  • Price serves two main purposes:

    • Provides information to customers

    • Determines profitability

  • Price speaks to the market category in which the restaurant falls

Pricing the Menu


Pricing the menu1

  • Profitability- amount of money remaining for an operation after expenses, or costs are paid

  • Target Margin- The difference between the amount of money left over from the sale of food or beverages (after preparation costs) and the amount needed to pay for other overhead, like rent or heat.

Pricing the Menu


Analyzing the menu

  • It is crucial to success of any operation that management have the knowledge and means to analyze how well items on the menu are performing.

  • One of the most popular methods is menu engineering

    • Menu engineering- systematically breaks down a menu’s components to analyze which items are making money and which items are selling

Analyzing the Menu


Menu items according to popularity

  • Stars have the knowledge and means to analyze how well items on the menu are performing.

    • Menu items that are profitable and popular

  • Plow Horses

    • Menu items that are popular but less popular

  • Puzzles

    • Menu items that are unpopular but very profitable

  • Dogs

    • Menu Items that are unpopular and unprofitable

Menu Items According to Popularity


Did you know

DID YOU KNOW? have the knowledge and means to analyze how well items on the menu are performing.

Carbonated Soft Drinks are one of the most frequently ordered items in the US. Their low cost and high profitability makes them a STAR on any menu


Any questions
Any Questions? have the knowledge and means to analyze how well items on the menu are performing.


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