THINK! Stuff
Some of the links are probably not active, but the ideas are still relevant to the retail and restaurant segments. Feel free to email me at frank@leopoldomarkets.com if you want to talk about how this information pertains to your operation.
JANUARY 2007
The 2007 Communications Plan
The 2007 challenge . . . deliver a personalized brand experience to every single customer
The international marketplace hype might lead you to believe that the secret to success is to sell mass quantities of the exact same product or service. The reality is that customers are avoiding cookie cutter products. They want to customize, personalize and purchase products and services that meet their individual needs. Customers want to make the product or service theirs. It is a small declaration of independence by each and every customer. If you can give customers the right options they will be very loyal. Assign this responsibility to an executive who has the clout to make it happen. Don’t let it become just another forgotten slogan.
Every restaurant customer has a unique brand experience.
There are very few purchases that are as personal as selecting a place to eat. After all, it is a product that the buyers put into their bodies. It is also an emotional purchase. It might be a social gathering or a break in a pressure filled day. The customer experience and motivation in selecting restaurants is unique to each individual. It is a personal choice that is similar to selecting a doctor, a hair stylist or a physical trainer. So why not offer customers options to personalize their buy to suit their needs, to make it special to them?
The downside is that restaurant customers expect a lot consistency from their favorite restaurants. You have to deliver predictable results from the choices you offer. If customers are disappointed, they just move on. The competition is intense and most customers won’t take the time to tell an operator why they are disappointed.
It is not enough to send emails and call it a loyalty program
Only a fully integrated marketing program strategy supported with multiple media vehicles will let you speak to all your customers. I learned the process of targeted marketing based on psychographic and demographic data working for a few great retailers early in my career. The technology changes rapidly. The strategy is constant. Send the right messages, to the right customers, at the right time. The dirty little secret is that micro-marketing is a blend of art and science and cannot be left to digitized programs created by techies and the bean counters. It has to be a marketing program based on a measurable strategy and managed by a dedicated executive. The negative fallout from customers who recognize automated digital targeting masquerading as personalized messaging is devastating to the credibility of any brand. It is very much like consumers on the phone, screaming at automated voice recognition systems that don’t recognize voices.
Even High Tech is using High Touch marketing messages.
Just look around and you will find cutting-edge technology merchants, as well as traditional retailers, trying very hard to convince customers that their pedestrian products and services are custom made for each individual customer.
Dell is running broadcast commercials that offer special options for every buyer. This one of the largest widget producers in the world inviting consumers to order a computer ‘built purely by you’ claiming you can customize your new PC to suit your special needs. Follow this link and click on view commercials tab to see the spots. http://www.dell.com/html/global/topics/purelyu/index.html
Verizon recognizes that they are selling a commodity. So they have fallen back to promoting the most personal element in the cell phone experience… the cell phone itself. Verizon promotes special colors and ‘flavors’ for your phone. All the cell phone providers have found that the only thing they sell that touches the customer is their point of difference. The technology is the second tier message. Check out his link http://www.verizonwireless.com/chocolate/
7 steps to deliver a personalized customer experience.
1. Commit every level of the company to offering every customer several ways to personalize their brand experience with you.
Make 2007 the year that you give customers control of their experience when they come to your restaurant. Find out what they want and give them options to personalize their experience. Instill this commitment in every part of the company.
2. Make it real. Start with a two-way communication program that encourages customers to offer their unvarnished opinions.
The most effective communication is a dialogue, not a broadcast. For every communication sent out to tell consumers to buy products and services there should be a corresponding retrieval of information about what customers like and need. Once you know your customers’ likes and needs you can romance each and every customer with the right motivation and product. Plan a series of tactics to improve your Customer IQ. Consider the following
For starters, use face-to-face customer surveys, phone-in feedback receipts, on-line surveys, text messaging, IMs, and outgoing telephone surveys of selected customer demographic profiles. Any vehicle will work as long as the process is objective, measurable and consistent over time. Avoid anecdotal information. Change up the mix of secondary communications vehicles year to year and track results for new insights. Cross-check critical data across two or more tactics to validate core data.
3. Reach out to current and potential customers with more sophisticated tactics as you build more customer data.
Customer selection of personalized options is in itself a great vehicle to better understand why your customers come to your restaurant.
Semi-annual customer intercept surveys – establish benchmarks
Targeted market recognition surveys – what do non-customers think about you?
Carefully select Cause Related Partner events – Partner with organizations that have members who are just like your customers.
Establish a Quarterly Advisory Board of selected customers for focus group feedback – It’s a focus group turned into avid word-of-mouth advocates, so pick out neighborhood leaders and rotate them out every three months.
Individual customized loyalty programs – Let your customers tell you what incentives they want, and how they want to access the program.
Red Phone Access to The Boss in high traffic locations in the restaurant. – Just make sure the boss always answers it.
4. Take a good look at your menu offerings.
Conduct quarterly menu reviews. Don’t shorthand this, it is an eye opener that pays huge dividends and provides some serious insight about your offerings.
Select a remote location and permit no distractions.
Bring all your managers and staff together for this and make it an event. Have the kitchen produce every item on your menu and group the items by category on a long tabletop. Tag each item with retail price, cost of goods $, cost of goods %, and the average # sold per day. Compare and review.
Average sale, average ticket, average party size and price-point distribution are all key drivers. Re-think your menu. Keep the top items in sales dollars and margin dollars. Everything else is up for review. Why not offer a hamburger for breakfast or bacon & eggs for dinner? Selecting a few sides or appetizers and a salad is a great solution for some customers. Offer some interesting sides as mix and match add-ons.
How does the portion size relate to other items and prices?
It may be time to unbundle your bundles. You know what I mean, the “comes with” part of your menu.
Traditional meal times are gone. Make sure your customers can mix and match menu items to create their own meal.
Test your take out packaging if you are in the business
Is it a male or female item? Products really do appeal to specific genders. Balance assortments to appeal to specific demographic profiles.
5. Have a consistent point of view that broadcasts your brand personality.
Identify the primary target customer base as your core, and then expand it. This is the group that delivers 80% of your sales dollars. Sure you don’t want to ignore other types of customers, but you are better off investing in attracting more of your core customers than to spend time and money attracting customers who are less likely to appreciate your brand.
Find out what the brand hot spots are. What do most customers think you do very well? Distill this information into a few short, simple messages. Then include them in all your communications. Test the messages in a controlled environment to be sure the communication is clear and has the desired affect on the listener or reader.
Make all decisions against the backdrop of this information. It works.
6. Keep it simple.
It is easy to become tangled up in technology and miss the forest for the trees. Always challenge every complicated, hi-tech methodology to be sure that there is not a less expensive, more dependable alternative. I recently worked with a client that had serious data collection deficiencies in the POS system. They did not have cover counts and average sale data in a full service, fine dining environment. Manual tracking sheets maintained by host staff easily provided the critical information.
7. Crisis Management
Every company, small and large needs to prepare a Crisis Management Plan. Once the plan is revised it is worth a key manager meeting to move the information out to all levels of the company.
Basic Events to include:
Response to negative publicity
Press requests for interviews
Conditions for business closure
Natural disasters
Key executive changes
Initiation of litigation
Basic Details to include:
Safety of personnel
Communications chain with phone numbers and meeting locations
Assign specific responsibilities to key employees
Securing assets and facilities
Government contact information
________________________________________________________
MARCH 2007
Significant Emerging Trends
Gridlock . . . Many cities in the US have announced that there is little room left for more roads. If you live in one of the fast growth markets like Florida , the Carolinas or Nevada, you are painfully aware of how exploding population growth is impacting everyday life. Americans have continued to reject mass transportation. Consumers are considering distance and travel time as major factors before they choose a home , select an employer, and visit retail centers. Local errands that used to take 15 minutes just two years ago, now demand more than an hour of travel time.
Population growth . . . Exponential growth of population centers is one of the most significant lifestyle changes that is on the horizon.
How does this affect your customers and employees?
Are you finding ways to take advantage of these changes, rather than becoming a victim?
Small neighborhoods are returning . . . More than fifty years after Americans migrated from congested cities to the tranquility of the suburbs the pattern is reversing. This trend is popular across several demographics. A few of the reasons are…
Gen Y and Gen X value friends more than family and want to live, work, and play near them.
Boomers are trading in the big family home for smaller quarters that are easier to maintain, with more amenities close by.
Seniors over 65 are looking at a much longer life-span and need to find affordable housing alternatives that will allow for their physical needs as they live well past 80.
The US population is projected to increase 50% in the next 40 years. The current 300 million population will pass 420 million before 2050.
The single family home is becoming an expensive luxury that is being replaced by townhomes and condominiums that are smaller and more suitable to the increasing number of single person households. Dense concentrations of these developments are creating instant city-like neighborhoods. With parking spaces scarce in these areas, residents are looking for merchants within walking distance or delivery.
It is time to develop a long term vision of how your customers will change their behavior in the future. Take a good look at your customers’ lifestyle and find ways to be more important to your customer. How can you save customers time?
Big box retailers and large restaurant operators are recognizing that they are over-spaced, and the cost is squeezing margins. They are targeting finely defined customer demographics to deliver maximized sales and margins per square foot with minimum inventories. Perfect models for those new neighborhoods.
Adding products and services with extended day parts has reduced speed of service at the most profitable hours for many operators. It is a bogus strategy. Find ways to sell more of your best sellers, to more customers, at peak periods. It will raise the boat.
Insufficient parking is limiting sales in even the hottest new retail centers. Find out how many parking spots you need and how quickly they turn. Invest in traffic directors to keep things moving if necessary. Make it a show at peak periods. Imagine a parking lot of branded traffic cops in uniform, directing traffic and dancing to brand supporting music. Don’t skimp, it is a very expensive compromise.
Reductions in service staff are destroying customer satisfaction. Customers don’t have time for a bad experience. Limit your hours of operation to those periods where you can deliver the best brand experience and enjoy the best margins. No merchant can afford to lose customers to easy-to-buy goods and services offered on-line and by phone.
Let Them Make It Their Own . . .
Customers are signaling a strong desire to personalize their brand experiences. In a world with ever increasing sameness, consumers are looking for ways to make their own Declaration of Independence.
Starbucks offers a long list of add-ins so that customers can create their very own personal “Starbucks”.
Cell phone companies have recognized that the cell phone itself is the personalization vehicle. Customers want the coolest phone to define their status, in their favorite color, with a meaningful ring tone.
Send the right messages,
to the right customers,
at the right time.
It is not enough to send emails and call it a loyalty program. Only a fully integrated marketing program strategy supported with multiple media vehicles will let you speak to all your customers. I learned the process of targeted marketing based on psychographics and demographic data working for a few great retailers early in my career. The technology changes rapidly. The strategy is constant.
The dirty little secret is that micro-marketing is a blend of art and science and cannot be left to digitized programs created by techies and the bean counters. It has to be a marketing program based on a measurable strategy and managed by a dedicated executive. The negative fallout from customers who recognize automated digital targeting masquerading, as personalized messaging is devastating to the credibility of any brand. It is very much like the frustrated consumers on the phone, screaming at automated voice recognition systems that don’t recognize voices.
Even High Tech is using High Touch marketing messages... Just look around and you will find cutting-edge technology merchants, as well as traditional retailers, trying very hard to convince customers that their ordinary products and services are custom made for each individual customer.
Dell is running broadcast commercials that offer special options for every buyer. Watch one of the largest widget producers in the world inviting consumers to order a computer ‘built purely by you’ claiming you can customize your new PC to suit your special needs. Follow this link and click on view commercials tab to see the spots. http://www.dell.com/html/global/topics/purelyu/index.html
________________________________________________________
SEPTEMBER 2007
E-marketing . . . the Silver Bullet.
So you now have a pretty website, regular email messages going out to your customer email list, and a Search Engine Optimization specialist making sure that your website gets first page recognition on Google. The real question is how does all this contribute to your sales and profits? What is your ROI?
If you have all these elements working, you have spent anywhere from $10,000 to $150,000 up front, and will spend much more in staff management, contract support, as well as additional software and hardware.
The only way to maximize the return on your E-marketing technology is to fully integrate it into your overall marketing strategy. It is not a separate marketing program. Consider E-marketing another media choice. Like all advertising media, it is much more effective when used in a coordinated marketing blitz with focused messaging and repeated impressions on a carefully selected target audience.
The element that pulls all of these communication vehicles together is your customer database. A customer database should include every piece of information, in the smallest increment possible, that can be gathered about your customers. This is not a strategy that has just emerged as a result of the latest electronic surveillance technology. The Romans recognized the value of gathering data on their citizens 2,000 years ago when they legislated a complete census every ten years.
Data collection on consumers has been around ever since the first merchant recorded the first sale. It is the basis for all effective marketing. Retail salespersons in the earliest department stores used to keep their “book” as their personal property. Store clerks recorded the size, color, and style preferences of their customers along with how much they spent, and how frequently. They knew what each customer was worth and treated them accordingly. When new inventories came in they selected items for regular customers and called them to look at the items selected personally for them. They took their “book”, and their customers with them to their next job.
Over the years, retailers recognized the true value of the customer information and built systems to collect the information so that they owned their customer info, not the salespersons. Supermarkets took advantage of the introduction of the computer to collect customer information 40 years ago and are still the best at driving profitable sales with the information.
The retail industry set the standard for profiling customer preferences and tracking buying patterns by offering private charge and loyalty cards.
The restaurant industry, especially the independent operator, has been slow to take advantage of digital consumer information. When I started managing restaurant operations, the best servers kept a daily record of the number of customers, parties, and sales dollars by daypart, with details on weather and any other event that was out of the ordinary. I learned how to make highly accurate sales projections from those servers.
Too few companies pay enough attention to their customer buying patterns, needs and wants. Sure they may be collecting this data, but who is managing it, and what is being done with the analysis? With all of the technology available, the industry is leaving millions of customer dollars on the table (pardon the pun).
Here is what can be done. You can know where your customers live; how much money they spend on products like yours; where they work; the dates, times and amounts of their purchases; if they want to be notified of special offers; how they want to be contacted… by phone, email, text message; and how much they spend with your company in a year.
After you know all that, you can make specific offers to get more customers to spend more money, more often. You can get your customers to send you their friends and family. You can get your customers to tell you what else they want to buy from you. You can even get your customers to talk about how great you are.
No company can do this overnight. There is no quick fix. No single tactic or initiative will deliver meaningful double-digit sales and profit increases immediately. It takes time, patience, and continuous re-evaluation of how you run your business. If your organization lacks the attention span and the discipline to work diligently towards a fully integrated marketing program, don’t even start. On the other hand, the rewards are substantial and will breathe a whole new energy into any company. It is the best way to take your business to the next level.
Isn’t it time for a marketing checkup?
Email me at frank@leopoldomarkets.com to set up a phone appointment for a complimentary review of your marketing options.
Frank’s book is a real-life take on bosses . . . the good, the bad and the ugly. It showcases the foundation of his marketing philosophy. Bosses are the people who are responsible for making a business a success or a failure.
This book was written as an airplane book. It’s a very quick read with only 42 single sided pages. Less is more!
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