Restaurant Marketing Is The Key To Success

Good restaurants fail. Few close up because of poor food quality. Even a smaller number close due to lack of motivation, dedication, and the willingness of management to work the 14 hour days common to independent operators. The plain truth is most restaurants close within five years of opening due to their inability to market their product, which leads to a financial disaster. Or more appropriately, they simply run out of cash or come to the realization that more money won’t solve their problems.

If you talk to the owners of padlocked restaurants, many offer a multitude of reasons. The reasons for their failure all seem to have a similar pattern that comes down to the three elements:

• Many say they had the wrong location.
• Independents say they couldn’t compete with the chains.
• Almost all say they just couldn’t afford to keep their operation open any longer.

Unfortunately, the statistics don’t back up the chain competition excuse. They fail too! Look around in almost every major metropolitan area of the country you will see big corporate operations that have shuttered their doors or sold to another operation. The difference between the independent failure and the single unit of a large conglomerate going down in flames is cash. Big companies can fund losing operations with profits from other units for a long period of time. Small operators don’t have shareholders’ dollars to fund their negative cash flow, so they tend to close quicker than chains.

Certainly a bad location can impact your ability to draw and retain customers. However, that doesn’t explain why many restaurants have non-descript locations with limited parking and poor access, but become raving successes.

Running out of cash probably is the most frequent common denominator. The restaurant owner sees a mountain of bills after several months of sales that are growing, but not fast enough to cover the out flow of cash.

We can offer lofty scenarios about the reasons why all restaurants fail at an alarming rate, but the simple plain English reason is they couldn’t bring enough business in the door to pay their expenses.

Entrepreneurs are dreamers. They start businesses to realize a dream. Some have good business backgrounds with solid training in their field. In the restaurant industry, there seems to be a theory that “good food” is all it takes along with a little advertising, and bingo, you have a line out the door. Restaurant entrepreneurs are a special breed, who don’t generally come from solid business backgrounds. They may have culinary skills, but that won’t be enough to guarantee any more success than the dreamer whose experience doesn’t extend beyond the home kitchen.

Even new restaurant owners with extensive business and marketing experience fall prey to the follow the leader mentality of advertising as their only marketing tool.

Food is not the engine that drives restaurants. In fact, multiple studies show that food represents only 40% of the various reasons a diner goes to a particular restaurant, chain or independent.

Marketing is the restaurant industry’s dirty word. Who would think the word marketing has anything to do with the best plate of spaghetti this side of Sicily. Of course, you “market” your product with thousands of dollars of advertising every year. Buy your padlock now while it’s on sale!

Marketing in the restaurant business has been misunderstood by most operators since the days of taverns that dotted the muddy horse and carriage trails of our ancestors. Even the executives of chains throughout the country have relegated true marketing to a single function – advertising.

Independent restaurateurs bemoan chains and their heavy discounting, mind boggling advertising budgets, and cookie-cutter marketing programs. Yet the things that seem to strike fear into the lone operator, are the answers to competing profitably. True marketing is rarely accomplished on a national scale. You may be able to successfully complete a partial marketing plan with advertising, but to implement in depth marketing, it must be done on your specific demographic level. Chains can’t easily compete with a marketing plan that is based on the one-customer-at-a-time philosophy.

Restaurant marketing is a series of actions that starts with communicating with customers to the final delivery of you product – that plate of delicious food you have prepared for the guest. Advertising is only a very small part of the true marketing plan. Challenge yourself right now; look up the definition of marketing in any dictionary you choose. See if you find any reference source that equates marketing with advertising.

In both The Restaurant Ebook and The Restaurant Marketing Plan Handbook, the definition of marketing is clearly explained along with dozens of examples of how restaurateurs can achieve their sales goals by using in-depth marketing tools for restaurants. No other single function of the restaurant owner is more critical than learning how other restaurants have survived, grown and prospered using all of the marketing functions successful businesses have used without relying on advertising as a weak alternative to true marketing.

More resources on restaurant marketing.