Understanding the restaurant marketing mix and having a model optimized for your restaurant is critical to an effective marketing system and the key to success when it comes to restaurant profits and staying competitive.
The marketplace is fiercely competitive for restaurants and pizzerias with local competition and big-chain presence. It is imperative that the marketing mix is regularly reviewed and optimized to ensure it is performing at the highest level.
A “marketing mix” is the right tool to employ to base the decisions on where to put the focus and resources, irrespective of whether the business is smooth sailing or going through a rough patch.
What is a Marketing Mix?
The marketing mix is what’s commonly referred to as the 4P’s of Marketing: Product, Price, Place and Promotion, this was identified in 1960 by Harvard professors and has stayed the standard model for developing the marketing strategy.
Here we will discuss what the 4P’s means for restaurant and pizzeria as a small business operator – a simple and effective marketing plan to execute for your business.
The marketing mix is the focus and outline of your marketing plan that is in alignment with the goals of your business. This relates to your menu offerings (products), menu item pricing (price), location and competitive positioning (place), and deals, specials and promotions (promotion) – the 4P’s.
How to Develop an Ideal Marketing Mix?
To develop the right marketing mix for the restaurant, start by getting clarity on the following:
- Market segment – Get a clear understanding of the market segment your business is positioned in. You are in one or more of the following segments – dining, carryout & delivery and catering.
- Target customer – Know who you are selling to and who needs or wants what you offer is rule number one in marketing. Know your customer, their age, gender, their income, where they live, etc.
- Competition – Identify your competitors in your market segments. You may have different competitors in each of your market segments. Analyze their menu, pricing, promotions and online presence to understand your relative positioning compared to theirs.
Determine The Marketing Objective
Here are some possible marketing objectives for the restaurant:
- generate awareness – Be visible locally and let people recognize your brand.
- increase repeat visits – Get some regulars coming in the doors.
- increase average check – The better relationships you establish with customers the more they will spend.
- competitive differentiation – Letting people know what makes your business special.
- building the brand – Making sure people know what your business represents.
- be top of mind – If you can be the first on your customers’ mind you will always succeed.
- improve value perceptions – Letting people know what your business is about.
If you don’t know where you’re going with your marketing you will end up spending money and never getting anything in return. Clarifying your marketing objectives should help you determine how much your total marketing budget should be since you can weigh the importance of achieving those objectives relative to other budget items for your restaurant.
If you are 100% clear on your marketing goals it’s much easier to determine the right path for your business and the right message to your customers.
Allocating A Marketing Budget
Your budget should always make sense from a business standpoint just like payroll and pricing, you should always have a percentage of the business income dedicated to marketing.
Here are some guidelines for a sensible Marketing budget.
- New location: 20-30% of forecasted revenues
- Undergoing a business transformation: 10-20% of revenues
- Established business: 2-10% of revenues
Remember this is a rough guideline, the actual percentage might vary depending on your business and situation but it is key to always have a marketing budget to bring in new customers in the door and increase your cash flow to allow your business to grow.
Next, what is the ideal marketing mix for my restaurant?
Components of Restaurant Marketing Mix
Here are 12 marketing channels for you to consider in your marketing mix:
1. Direct Mail Marketing
Restaurants and pizzerias have used direct mail for years. Sending a postcard, brochure, or letter, direct mail is a proven approach to finding new customers in the local area. You can consider adding this to your restaurant marketing mix.
It is effective with certain higher age groups and demographics. Consumers have come to trust it. Offering special offers and coupons are very effective way to attract new customers
Including the restaurant website link and including images of the restaurant mobile app is a great way to integrate online marketing.
With high view rates, this is a great way to stay top of mind.
The costs can range from a few cents to over 60 cents per mailer, depending on the type of mailer. This includes the postage costs.
Tracking redemptions can be a challenge, but it is important to track to be able to measure return on investment (ROI) on direct mail campaigns.
Do you need help with a strategy to measure and maximize ROI from current or new direct mail campaigns? Contact us for a strategy session »
2. Call Campaigns
This is a very effective channel for marketing your restaurant’s catering services to other local businesses. You should consider testing this method and adding it to your restaurant marketing mix.
Picking up the phone is a simple and inexpensive way to build new relationships and grow your business. This is a great tactic for local marketing.
It can be time-consuming, but very effective in building trust due to the personal interaction with the customer.
This can provide a great return on investment on efforts related to building catering business with higher average checks.
3. Billboard Advertising
Restaurants and pizzerias have used billboard advertising for a very long time. Billboards are expensive and can run anywhere from 3000-5000 per month. They also take a long time to capture attention.
It is difficult to track responses and measure ROI.
Including the restaurant website link and including images of the restaurant mobile app is a great way to convert drive-by views to online traffic. It is important to have an easy to remember URL for customers to remember. It is also important to optimize your restaurant website to be found when people search for your restaurant name online.
If you include billboard advertising in your restaurant marketing mix, remember to have a way to track responses to ensure the relatively big spend is producing a positive return on investment.
One simple but effective strategy is to use a coupon code for use with online ordering or call in. The online ordering and POS report at the end of the campaign can show how many conversions resulted from the billboard ads.
4. Search Engine Optimization
It starts with a website and search engine optimization, you can hire local or overseas SEO experts that are fairly inexpensive to do this.
But the best SEO you can get is the website and social media interaction, this is obtained through a good design that is customer friendly, social media integration, content marketing, inbound marketing, etc. it is also important to have good sales copy on your websites that convert visitors into customers.
It is highly recommended to include search engine optimization in your restaurant marketing mix as it supports other online and offline channels.
If you are looking for ideas on how to improve your restaurant website, read article on “5 Must-Have Features For Every Restaurant Website“
5. Local Search Optimization
Register your restaurant website in local directories and update local listings so that people can actually find you when they are looking for you.
Claim your business page in local directories so that you can maintain accurate information about your business including menu, cuisine, location, website address, phone number.
Doing local search optimization for your restaurant is very important in the restaurant marketing mix to ensure that your business stands out locally.
6. Email Marketing
Email is a fast, cost-effective way to stay in contact with your customers and acquire more potential customers online.
Emails don’t get the response direct mail or mobile marketing does but it does generate a more comfortable environment for the user and if done right can provide a huge ROI due to its low cost.
Including email marketing in your restaurant marketing mix can provide one of the highest return on investment over a long period of time.
To learn more about how to have an effective email marketing program for your restaurant, read article on “7 Restaurant Email Marketing Strategies to Boost ROI“
7. Social Media Marketing
Leveraging social media is no longer a matter of opinion anymore. People in this era spend almost a 3rd of their day on social media.
If you want these people to know you, you have to be on social media. It is no longer an option.
Including social media marketing in your marketing mix requires dedicated resources to manage your social media postings and daily engagement with your customers on this platform.
8. Mobile Marketing
People respond way more to text messages than they do to emails or direct mail but you need to be careful because it can be more invasive to the user.
Mobile apps now have the capability of push notifications that is slowly replacing text messaging. Consider a mobile app for your business that offers users priority info, special offers, and deals.
Adding mobile marketing to your restaurant marketing mix needs an implementation strategy for developing your mobile app and mobile promotions.
9. Pay-Per-Click (PPC) Ads
Compared to traditional advertising, pay-per-click advertising offers some great advantages.
It is extremely cost-effective, you can target specific demographics with amazing precision and one of the greatest advertising innovation.
Retargeting. This makes your ad pop up everywhere your potential customer goes remembering this person that they once showed interest in your business.
Another advantage of online PPC advertising is tracking and analytics, tracking services can give you very specific information about your target market and what they best respond to.
Google Adwords: This platform allows your to advertise on specific search results so that people who are looking for what you offer have no problem finding it.
Facebook/Instagram Ads: It’s a platform with very effective targeting and it’s very cost effective. For example: For 10 dollars a day for 10 days, can potentially reach 10,000 people within a particular segment within a 10-mile radius.
Online PPC advertising offers some exciting possibilities and needs to be considered in your restaurant marketing mix.
10. Deals Marketing
Groupon and Living Social is a great way to go, offering special deals to people in your local area and getting more exposure for your business. Target segment for Groupon is young women and professionals.
Restaurants and pizzerias are very popular on these deals platforms.
Including deals marketing in your restaurant marketing mix needs to be planned out well to accomplish the business objectives without diluting the brand image from deals discounting.
11. Community Marketing
Word of mouth marketing can be very effective for your business. Add community marketing to your restaurant marketing mix can yield some great results.
The marketing opportunities in your local community can be in the form of school fundraiser programs, church and sponsoring local sports teams. Participating in “Dine and Donate” programs where a certain percentage (10-20%) goes to the organization can be a great way to support local programs while getting the visibility.
Donate pizza at local events for free for people to sample your food is a low-cost yet effective in getting local visibility for your business.
The local chamber of commerce and local publications can get the attention of many people in your area and get them to come to your place of business. Many people actually look for nearby restaurants and pizzerias in local listings and publications. Make sure they find you.
Including community marketing in your restaurant marketing mix is a must as it positions your business as part of the community.
12. Online Marketplace Hubs
Using online marketplace hubs (GrubHub, Eat24, OpenTable, etc) can be a great opportunity to drive new traffic to your restaurant from these online hubs.
Typically, they have a commission for each incoming order and service charges. It is important to factor in those commission percentages in business financials to make sure it makes sense and provides a positive return on investment.
Including online marketing hubs in your restaurant marketing mix can be used to get additional visibility especially when your target market segment is on those platforms.
This is certainly not all the options, but I think you have a good grasp of all the possibilities by now… Other options include TV and Radio ads.
Creating An Ideal Restaurant Marketing Mix
With a marketing objective established, a budget allocated, and selecting the marketing channels that are relevant to your business, the next step is creating the mix.
Depending on the marketing objective, determine the best offline or online channels that offer the best chance of success.
What marketing channel offers the best ROI?
Some channels are more expensive than others but if ultimately if they bring in more money than the money you’re spending it’s a good investment.
There are no guarantees but you can roughly estimate the number of people reached and the total sales that represent, then make your decisión.
For example, billboards may be much more expensive than direct mail but it might elevate the status of your business and get you customers that are more willing to spend money than direct mail.
On the other hand, direct mail may be more personable and can help establish a better and more direct relationship with customers. Depending on your objective you could choose one or both mediums.
What channel offers the best reach and engagement?
Online advertising is all about customer reach and engagement, so you must determine which channel is going to get you more of that reach, engagement, and get people coming back to your business over and over again.
What channel offers the best conversion?
With online advertising, you always have to be aware of conversions – how many of your fans or followers turn into actual customers?
Depending on your business and your goals some channels work better than others. To answer those questions, you can leverage industry data. You can even learn from what your competition is doing. Once you glean outside information, the best approach is to perform small-scale testing before committing bigger budgets and scaling big.
Now your turn:
How is your restaurant marketing mix looking? Are there any other channels that you are using in your marketing mix? Let us know in the comments section below.