Growing Your Restaurant Business - MGR Blog

Are you planning on opening or managing a new restaurant? If so, I’m sure you’ve heard the alarming statistic that 95% of restaurants fail within the first year.  However, the truth is not as bad as the rumors.  According to Forbes, the real number is closer to 17%.

That being said, the restaurant industry continues to be one of the hardest and most competitive industries in which to open a new business.  I’ve known and participated in a few “new restaurant” ventures myself, and one of the key elements to success is to think about marketing first and food and niche features second.  Most passionate restaurateurs are so in love with their “niche idea” that they truly believe “build it and they’ll come” will work for them… until it doesn’t.

Location and food traffic are still critical, but so is a solid marketing plan.  Here’s a quick list of Discovery Questions for Restaurant Marketing.

  • What is your target demographic, age, income, location, language.
  • Does the restaurant have a street front of is it inside a hotel, shopping mall or building?  How do you get ‘eyes & bodies’ in now?
  • If a hotel restaurant, are you considering hotel guests promotions vs. non-guests’ promotions.  Using Your own 1st Party Data.
  • Are you using Open Table database & Social Media Retargeting?
  • Are you creating video content, video ads, Facebook Live, Instagram Live, YouTube Channel content?
  • Do you have a Chef’s Blog – Podcasting – Culinary Recipes, From the Chef’s Kitchen
  • Do you offer Catering for Private Dining and Group Dining?
  • Do you have Special Events, Happy Hour, Holiday Events, Themed Events, Wine Tasting Dinners
  • Who are your current competitors, nearby or otherwise?
  • Do you sell Merchandise or Food Product Sales to patrons, selling on-site or online for delivery?

Think in terms of “Direct to Consumer” (DTC) sales.  Build your audience, create your 100 or 1,000 true fans, and then sell to them any products you want.

Here’s some additional data to support the direction of your marketing plan:

  • The average time that a consumer is willing to travel to a local restaurant is 17 minutes and this has little change depending on age groups.
  • The most common platform for restaurant advertising in 2017 is social media and is utilized by 75% of restaurateurs. (Source)
  • When it comes to social media, restaurants are most likely to use Facebook (92% of restaurants) and least likely to use Snapchat (16% of restaurants). (Source)
  • Pent-up demand for restaurants remains high, with 39% of adults not eating on premises at restaurants as often as they would like. (Source)
  • 61% of adults say they would rather spend money on an experience, such as a restaurant or other activity, compared to purchasing an item from a store. (Source) 
  • New Customers Vs Returning Customers: 40% of customers will return after 1st 42% of customers will return after 2nd visit.  70% of customers will return after 3rd visit.  Market for 3 visits.
  • Diners prioritize delicious food when choosing a restaurant to visit, followed by quality of service. (Source)
  • 51% of diners go out to eat more than once a week. (Source)
  • When placing an online order, a patron is more likely to use a restaurant’s website than a third-party site like EAT24. (Source)

What if I told you that you could have your restaurant full every day for just about $30/day?  Would you be willing to spend that?  If not, this article is not for you.  But I’m sure $30/day is worth a try, right?  Ok, let’s see how we’re going to make this happen.

  • 69% of millennial diners take a photo of their food before eating it.  I’m sure you’ve seen this many times…
  • 59% of millennial diners say that they review menus online before going to a restaurant.
  • 30% of millennials actively avoid restaurants with a weak Instagram presence
  • 50% of Gen-Z prefer limited service and fast-casual dining over full service restaurants.

In general, more and more people are using Instagram and Facebook to decide where to eat and how they’ll be able to share their own experience (and pictures, and Instagram posts) with their own followers.

By now, you’ve probably guessed how you should invest those $30/day that I mentioned above.

The first step is to make sure that you have a Facebook Business Account or Ad Account for your restaurant.  But don’t worry, if you don’t have it set up, our team at MGR can do that for you.  Once your Ad Account is created, we can structure your ad campaign by ad groups, ad sets, etc.

The secret sauce (no pun intended) is in proper targeting to capture your consumers attention at the right place and at the right time.

How do we target them at the right place?  Well, we know that people usually don’t travel too far to go to a restaurant.  In fact, the national average is about 17 minutes, so that allows us to Geo-Target potential consumers within a 10 mile radius of your location. 

The next targeting metric is placing the ads in front of them at the right time.  A restaurant ad displaying at 3:00 AM is not going to do you any good.  So we focus on peak or near-peak hours when people are hungry and looking for a place to eat, whether it be breakfast, lunch or dinner.  We can do that by scheduling the ads to ONLY show at our selected times of the day.

And of course, when your restaurant is closed, we stop the ad campaign to save our ad dollars.

Now that we’ve selected your Geo-Target area and the peak hours of the day to display your ads, our next step is to target the type of people that best fit your restaurant demographic.  Is it a sports bar, or a romantic atmosphere, do you serve alcohol, or is it a family restaurant, ethnic food, organic, vegetarian, etc.  That will determine the age group, gender, hobbies, dietary preferences, and a number of other qualifying factors that we can set to make sure that your ads are only seen by the type of consumer that is more likely to “buy.”

If your restaurant is near a particular landmark or venue (i.e. sports arena, convention center, trade show location, etc.) you can also check the event schedule and target your ads to those particular visitors.

The next targeting parameter is separating your desktop users from mobile users.  Since the majority of people will make their restaurant decisions while they’re “on the go”, we’re just going to place our ads on people using their mobile devices.  Are they taking a selfie?  Checking in at their favorite fashion outlet?  How about showing to them your enticing restaurant ad with a succulent food shot and a special offer just as they are posting their own picture on their Facebook timeline?

Let’s recap what we’ve done so far real quick:

  1. We’ve determined the geo-target or radius around our restaurant to display our ads.
  2. We’ve selected the best times of the day to display the ads for our particular locale. This could be breakfast, brunch, happy hour, dinner, etc.  Remember, you want to promote your restaurant when you need more customers, not when it is already full.  So the peak hours can be adjusted as needed.
  3. We’ve also narrowed down our demographic target based on our type of restaurant and the type of customers that typically visit it.
  4. Finally, we’ve elected to show our ads only on mobile devices to focus mostly on foot traffic.

So far so good.  Now we just need to create the ads.  That’s easy, just copy and images, right?  Stop right there!  We need to create compelling ads!  Do you know the difference between sales and marketing?

Sales: Get a Steak 50% off today.  Call Now.

Marketing:  We’ve got your table ready and your steak is marinating!  Just let us know when you will arrive.  Call Now.

In other words, you’re trying to create an emotional connection between your product and your customer.

Of course the above applies if you own a steakhouse but you get the idea.  As far as images, food shots are always appealing but don’t forget that people also like people.  And when it comes to restaurants, people go out to eat because they like to see and be seen.  In other words, there’s a social aspect to it.  So images with happy people eating dinner will always work and attract like minded people to your locale.

This is also one of the cases when A/B testing your ads will do wonders for you.  Try different ads, headlines, pictures, and see which one performs best for you.  Then go with the winner!

Depending on the type of ads that you create, you can also add links to your menu and pricing.  Remember, nobody wins if when they arrive at your restaurant they decide that it’s not within their price range or the menu is not what they expected.  You want to focus on a high conversions campaign making sure that your visitors become customers.

The possibilities are truly endless.  Is it going to work 100% all the time?  Definitely not.  Nothing in advertising does no matter what other agencies may tell you.  But it sure works better than waiting for people to find you, or worse off, letting your competitors take your customers away from you.

Good luck and happy marketing!  And as always, if you need any assistance with your digital marketing, our MGR Team will be happy to chat with you one-on-one.  Use this link to contact us and set up your free consultation.

Thank you for reading.  Until next time, this is Manuel Gil del Real (MGR).