The question that every restaurant owner has on their mind is simple: how can I increase the profitability of my restaurants. While there are some very blatant way to accomplish this such as cutting back on the quality of the food and paying your workers less, these are not ‘ideal’ solutions. Rather, these would be considered cutting corners.
There are many ways for a restaurant to increase their profitability as well as the foot traffic that they get and would like to share 5 tips that we feel every restaurant owners should consider in regards to profitability:
1. Social Media We’ve mentioned it before, but we’ll mention it again. Social Media can be daunting and scary, but at the same time it can be a powerful marketing tool for a business. By using social media as communication tool , you can build relationships that keep your business top of mind with potential customers. By using it as a brand monitoring tool, you can listen to what people are saying, both good and bad. When used effectively as a whole, social media has the potential to help a restaurant increase it’s brand awareness and most importantly, it’s profits.
2. Email Marketing We mentioned how social media can be a great tool for staying in touch with customers, but another way that can be an effective strategy is email marketing campaigns. By collecting and building out email databases of customers that have dined in your restaurant, you will be able to market to them special dining opportunities, new menu items and even a special dessert for their birthday.
Here is an example of how Fleming’s Steakhouse sends out creative email campaigns during seasonal holiday and events:
3. Menu Pricing Rather than making ‘gut feeling’ calls on how to price your menu items, consider using the following tips on how to set menu prices that are accurate and most importantly competitive. Remember that setting your prices to be reasonable, doesn’t mean that you are sacrificing profitability.
4. Local Searches Aside from word of mouth referrals and passerby’s, another way that customers find what restaurant to eat at is through local searches online. Restaurant owners should take the time to look up what information is available on their business when searching for key terms related to it. Often, potential customers will be able to look up menu prices and items, locations, and reviews on a business. Make sure that what is online accurately reflects your business. (It would be embarrassing if the address for your restaurant was listed incorrectly.)
Google is a great place to start your search about your restaurant:
5. Focus on creating repeat customers Repeat customers are the lifeline of many restaurants. Not only do they dine at a restaurant on a regular basis, but they often tell their friends which can lead to more revenue. Because of their importance, restaurant owners should consider the value in creating a loyalty program for its customers. Specifically, by creating a loyalty program, a business will not only be able to reward their most loyal customers, but also learn more information about them such as their frequency and what they buy. *Note that data capture of this nature is only available with certain loyalty programs.
What are some things that you have done to increase the profitability of your restaurant? We would love to hear them!