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Restaurant Marketing 101

The Importance of Marketing

It is a harsh place out there for independent restaurants or other food service establishments. There are so many chains flooding the market that it is difficult for small businesses to compete. People are comfortable with chains, and they know they will have a similar experience every time they eat at one. They know what to expect. Eating out at an independent establishment is riskier for the customer.

For reasons like this, franchises dominate the food service market. In fact, fewer than 25 companies account for 1/3 of restaurant sales in the United States.1 Independent restaurants probably do not have the resources to pay for television ads, like Pizza Hut or Chiles, but if you own or manage one of these establishments and want to vie with franchises for business, you must market yourself to gain a competitive advantage.

Your restaurant may be doing well, or it may be struggling. Either way, marketing will help you increase your profits. Restaurant marketing really only has one goal: to make more profit. If you lose sight of that goal, your marketing campaign will not be effective. Marketing can help profits in three ways:

Fill up the restaurant.

Get new customers or convince existing customers to come more often.

Sell more.

Increase the average check amount by convincing customers to buy more items or buy more expensive items.

Sell the right things.

Convince customers to purchase the more profitable items, which have larger contribution margins.

10 Steps to Successful Marketing

Ideally, you want to improve profits using all three of the above tactics. But many restaurant owners and managers do not even know where to begin developing a marketing strategy.  Whether you are a new business or a well-established restaurant, you should be constantly reevaluating and modifying your business strategies to take advantage of the marketplace. Here is a simplified step-by-step outline for successful restaurant marketing:

1. Analyze the marketing environment.

Perform an environmental analysis of the trading area as well as general widespread trends. Learn about your prospective customers and what they want. » Learn More

2. Gauge the competition.

Evaluate your direct competitors. Seeing where their strengths and weaknesses lie can help you gain a competitive edge. » Learn More

3. Target one or more segments.

Analyze your target market and what these consumers want. You cannot make everyone happy, so you should usually focus your marketing on one or two segments of the population. » Learn More

4. Fill your niche.

Determine your positioning and unique selling point (USP). Focus on your strengths and downplay your weaknesses. The best way to market your restaurant is to stand apart from the rest.

5. Perfect your operations.

Make sure all of your operations are in order and your existing customers are happy. Successful branding can only occur when your product meets customers’ expectations. » Learn More

6. Make a plan.

Develop measurable marketing goals and an actionable plan to achieve them. Different types of restaurants will chose different marketing techniques according to their positioning and target market.
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7. Budget your marketing.

Estimate the costs of marketing and the probable return you will get on that investment. Create an overall marketing budget as well as a separate budget for each marketing technique in your plan.
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8. Take action.

Implement the marketing techniques you have chosen. Make sure you do not go over budget or stray from the plan.

9. Assess your success.

Calculate the effectiveness of your marketing techniques. If the marketing tactics are unsuccessful, an assessment can help you figure out why, how to fix it or whether you should scrap the whole tactic.
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10. Continue to adapt.

Repeat these steps every few months to keep up with the shifting market. Whether or not business is going well, you should continuously make changes to stay ahead of the competition.

The Four P’s of Marketing

As you implement the above ten steps and develop a marketing plan, you need to think about the basic components of any marketing strategy. There are four elements of your business that you should always keep in mind. The following four P’s of marketing, which make up the “marketing mix,” were identified by Harvard professors in the 1960s, and since then they have become a standard model for developing marketing techniques:

Product

The product is more than just the food and drink. The product is everything that you are selling, and in a restaurant that includes the menu items, merchandise, service, atmosphere and the whole experience of dining out.

Price

Simply put, the price refers to how much the product and merchandise cost. Pricing is extremely important in marketing because, along with quality of product, it influences the perceived value of what you offer to your customers.

Place

Place refers to not only the location of your restaurant, but to the characteristics and demographics of the trading area and all of the people and competition that exist inside of it. Place should be constantly evaluated with an environmental analysis.

Promotion

The promotion includes all of the marketing techniques you use to sell your product. This can include coupons, specials, contests, public relations, merchandising, advertising, personal selling and word of mouth.

Service marketing, which is always an essential aspect of food service, traditionally looks at three more P’s: people, process and physical evidence. However, it may be simpler to consider the “service” as part of the overall product.

You should constantly be tweaking your price and product in order to better promote your restaurant in the place where you do business. This may involve taking risks, but in the competitive world of food service, risks should be considered necessities for success. If you can constantly reevaluate the four P’s of marketing, you will establish the right mindset to develop a truly remarkable marketing plan that will pay off.


1 Patti J. Shock, Restaurant Marketing for Owners and Managers (Hoboken, NJ: John Wiley and Sons, 2004).