1. Hospitality:
Restaurants

2. Fact: 2 out of 3 restaurants fail in the first 3 years of operation
Fact: 2 out of 3 restaurants fail in the first 3 years of operation! REASON?
Lack of Capital
No money for
marketing &
merchandising

3. Factors that play a role in success of restaurants:
Pricing
Advertising
Customer Service (90% will not return if they were unhappy)
Too many competitors
Location
MANAGEMENT
GOOD FOOD AT A FAIR PRICE!
GOOD ADVERTISING THAT ATTRACTS CUSTOMERS IN TO RESTAURANT
GOOD CUSTOMER SERVICE :WAITERS,HOSTESS, ETC.- KIND, FRIENDLY, HELPFUL
COMPETITION IS FIERCE- NEED TO OFFER SOMETHING DIFFERENT EVEN IF IT’S JUST IN SERVICE!!
LOCATION IS VITAL TO THE SUCCESS OF A RESTAURANT- SEE NEXT SLIDE!!!!

4. The better the location the less marketing dollars spent!!!
There’s a link between
Location
Marketing
The better the location the less marketing dollars spent!!!

5. Location considerations:
Visibility
Demographics
Accessibility

6. Marketing your restaurant:
The most important step is to choose a name that makes a lasting impression- CUSTOMER’S WILL REMEMBER.
Name & logo should “fit” together.
It must convey the image & tell about the product you are selling
Remind students of logo notes

7. Goals when promoting your restaurant:
Keep existing customers
Attract new ones *(more costly)
Develop LOYALTY programs

8. Restaurants use tracking systems:
Counts the number of responses
generated from each ad placed

9. TRACKING SYSTEMS:
HELP YOU SEE IF MONEY SPENT ON ADS IS REACHING YOUR TARGET MARKET
CODE # ON THE COUPON HELPS YOU KEEP TRACK OF WHERE IT CAME FROM

10. Cost of an Ad
Circulation of Paper in Thousands x Size of Ad x CPM = Cost Per Running an Advertisement
CPM = cost per thousand, use $100

11. SUCCESSFUL? CALCULATE:
$ $ $
CPR= cost of running ad / response (For response you would look at coupons redeemed)
Cpr = cost of running ad DIVIDED BY the response (# of coupons redeemed)
Cps= cost of ad DIVIDED BY sales amount.
CPS= cost of running ad / the total
amount earned from sales

12. Restaurants also use “non-perishable” promotions:
Continually remind customers of you because they never “expire”
Another term for “promotional items”
Examples found in restaurants include:
CD’s, magazines, cookbooks, mugs, etc.