Bathrooms:

Annual Bathroom Blogfest is occurring today, All Halos Eve! There are some great stories about the horrors of bathrooms in the customer experience.

Restaurateurs invest ten to twenty-five percent of their construction budget into building bathrooms. A significant portion of your monthly rent payment finances their continued existence. Many a wonderful dining experience has been obliterated after answering natures calling. Why?

Have you ever visited a restaurants bathroom and thought maybe you had entered a war zone. The bombed out stalls, the peeling paint, the unhinged stall doors, the burned out lights, the chipping grout and the stained bowl, did you think to yourself why?

A restaurant will not create customer advocacy with its bathroom in disarray. Is it really that difficult to insure that the bathrooms are clean, that there are ample supplies and that possibly there are fresh flowers?

All Halos Eve is about the forces of darkness marshalling their energy for their climatic battle against the forces of light. Your restaurant needs to be on the victorious side in the battle of the bathrooms!

Smile:

Roger Dooley’s Neuromarketing Blog post “Smiles Really do boost Sales”

“Flashing smiling subliminal images at customers waiting to be served at a burger restaurant doesn’t seem very practical, or very ethical for that matter. I think the study does show that even a tiny elevation of mood, so small that it is imperceptible to the subjects, could affect their spending. This means that the manager who trains her employees to smile is on the right track. It also suggests that imagery in the purchase area should be positive and people should be smiling.”

A smile is the best way to say “Hello, won’t you come on in. We are glad you here. You are very important to us”

Smile.

City Anchors:

CEO for Cities blog post “The Bookstore as a Community Center” emphasizes the role of restaurants in community development.

“Distinctive retail shops and restaurants, particularly those that function as community gathering places, are now important amenities for cities. Cities need to learn to value these amenities (all stores are not created equal) and act accordingly.”

Real Estate development and restaurants need each other desperately. Cities to attract the creative class need to be areas where both can flourish.

Restaurants have always been City Anchors!

Diners Bill of Rights:

Leslie Brenner’s Los Angeles Times article “Diners, Stand up for your Rights” examines a growing movement.

“VIP treatment. If you are not a VIP, you have the right to the same service as a VIP.”

Listen up restaurateurs, your guests are mad as hell and they are not going to take it anymore. Diners are demanding their Bill of Rights!

Tea is the New Coffee:

Restaurants and Institutions points to a New York Sun article “Tea Salon Get Set To Expand”

"It's not just about tea — it's a lifestyle," she said. "You aren't going to go to a yoga class and then drink an espresso. You stay in the moment — you drink a cup of tea."

Tea is gaining ground because coffee is not for everyone. People want a non coffee alternative to enjoy. Chicago based Argo Tea is a concept the encapsulates the trend very well.

Tea is the New Coffee!

Karma:

Christian Science Monitor article “A restaurant with no checks” outlines life in our brave new world:

"In the spirit of generosity, someone who came before you made a gift of this meal. We hope you will continue the circle of giving in your own way!"

A previous post “Set your own price” asked the question when this would occur. The universe has a way of answering all queries, that is after all Karma!

That’s Expensive:

Patrick Williams whose blog is a must read has a very interesting response next time your guest questions your price. Whether you are putting together a large private dining affair or are taking a large corporate catering order the first time client will undoubtedly say how expensive that is. Patrick’s response is

“I looked them straight in the eye and confidently reply, “yes, it is reassuringly expensive, isn’t it?” I confirm they are buying the best because I couldn’t possibly charge that price if what I sold didn’t deliver.

Of course, the product or service must deliver and I am confident what I sell does deliver, time and again.”

Try the response out next time a new guest pushes for a discount. You and your staff strive constantly to put out the very best product you can. Don’t discount period, if you must make concessions use the value added approach by offering some additional product at no or limited charge.

You are now ready to respond when guests feign shock and say That’s Expensive!

Make plain food taste Great:

Titus-Armand’s Project Armand blog post on “11 Tips to make plain food taste great” offers an interesting take taste enhancement.

“Adjust the lighting. Lighting is really an important accent. It adds texture and color and glow to the food. There’s not a lot of knowledge about what lighting can do and most people take it for granted – it’s either on or off. Experiment with it and you’ll notice that the food might actually start looking better that you would’ve imagined!”

The post is aimed at individuals, however restaurateurs can easily gleam some very good ideas to Make Plain food taste Great!

Relational Customers:

Grokdotcom.com post explains the difference between a one time customer and a customer advocate:

“Transactional customers:

• Consider only the current transaction when making a decision
• Are generally willing to switch suppliers, stores, etc., for reasons of price alone
• Prefer to be their own expert

Relational customers:

• Consider any transaction to be one in a series of interactions with a given business/expert
• Generally will not comparison shop once they’ve found their expert
• Are searching for an expert they can trust”

Restaurateurs need to be resources for their guests, not just providers of a service. Restaurants need to add value to their guest’s life and in so doing develop Relational Customers!

PCI Compliant

FastCasual.com has a good article on “PCI Compliance”

“The credit-card industry including Visa USA, MasterCard, American Express and Discover are cracking down on restaurants and merchants in an effort to better protect cardholder data.”

PCI compliance is being enforced vigorously. Many chains have taken an aggressive stance because they realize that a breach at any one of their locations puts the entire system at risk. The risk of course is non participation in the credit card payment system. That would be a death knell for any business in the 21^st Century as customers are making $0.36 purchases with debit or credit cards. Single unit operators must be certain that there stand alone credit card machines are compliant.

The industry has come a long way from the messy carbon copies and we still have a ways to go because customers are vigilant about their accounts. The ability to view transactions online has helped and hindered. Customers do not understand the concept that the issuers have of holding an account after authorization has been given. Many a restaurant accountant has had to explain to an angry guest, that their card was charged the correct amount by the restaurant and it’s the credit card issuer who has added additional amounts to the hold waiting for the batch from the restaurant.

It is very important that you as a restaurateur make certain your establishment is PCI Compliant!

What was that special again?

Melissa Clark of the New York Times did a great article “If it sounds Bad it must be Good”.

“THERE are some restaurant dishes that I order because they sound better than everything else on the menu, and there are some I order because they sound worse. My reasoning goes like this: If a chef dares to offer something as unappealing as, say, a raw kale salad, chances are it’s fantastic. I’ve played this game at restaurants all over the world, with mixed results. But when I score I score big, with a perspective-changing moment that can inspire pure glee.”

Restaurateurs need to consider all aspects of menu marketing when creating and naming items. Restaurant guests are oblivious to the expenditure of energy that is require to develop and then name an item on a menu Actually menu design is both art and science with the dull unimaginative creations holding sway in most establishments.

There are many Melissa’s out there who will trust you when you drift from the familiar and take a chance, now what was that special again?

The Mud of Mediocrity:

"Make no little plans; they have no magic to stir men's blood...Make big plans, aim high in hope and work” Daniel Burnham

David Schwartz’s landmark book “The Magic of Thinking Big” provides a framework for success, “Think Big”. One of David Schwartz’s keys to finding success by thinking big is the concept of “adding value.”

My favorite phrase from that book is “the mud of mediocrity”. Most businesses produce barely enough to get by because they are mired in the mud. These enterprises never rise beyond the level of competence and certainly never aspire to greatness. They are very comfortable in the mud.

An entrepreneur to succeed must add value to everyone that touches their path. A guest walks into your restaurant because they believe you will add value to their lives, an employee works for your organization because they believe your organization will add value to their lives. Vendors do business with you because they believe you will add value to their lives.

I have banged this drum before and I will continue to do so. A guest does not walk into your restaurant because they want food. They can get food anywhere. They walk into your restaurant because they want you to add value to their lives.

Adding value to everyone who touches your path will create customer advocacy and lift you from the Mud of Mediocrity!

Eye Contact:

Creating customer advocacy is as simple as making eye contact. When your guest walks in, make eye contact. If you are behind the counter look into their eyes and notice the color of their eyes. Have the host or hostess notice the color of the guest’s eyes when they approach. Have a server notice the color of the eyes of the guest that is ordering. When a restaurateur approaches a seated table, they should notice the eye color of the person.

Looking at the eye color is a very good trigger to help you and your staff make Eye Contact.

Thank You:

The ending of a dining experience is the beginning of the next visit. Athletes, musicians and showman always like to end strong and leave the audience wanting more. Restaurants need to close a guest visit with a powerful Thank You!

The guest has enjoyed a wonderful experience in your restaurant, the food was innovative and delicious, the service was exceptional, the ambience perfect, now say goodbye with a Thank You!

A Thank You can be a forthright expression when giving change in a coffeehouse, a Thank You can be a cookie placed in the guest’s car by the valet, a Thank You can be a hostess or manager at the door opening the door or helping the guest with their coat, a Thank You can be a complimentary dessert provided to a guest, a Thank You can be a firm handshake and a warm smile.

A Thank You to be meaningful must be genuine, it must be unexpected, and create in the guest a sense of belonging and community.

Thank You!

Rising Inequality:

Wall Street Journal Article by Greg Ip details the Income-Inequality Gap

“The wealthiest 1% of Americans earned 21.2% of all income in 2005, according to new data from the Internal Revenue Service. That is up sharply from 19% in 2004, and surpasses the previous high of 20.8% set in 2000, at the peak of the previous bull market in stocks.

The bottom 50% earned 12.8% of all income, down from 13.4% in 2004 and a bit less than their 13% share in 2000.”

The gap has been widening for thirty years so the effect has been pronounced. What might be an interesting question for restaurateurs is how this plays out in their restaurants. The last three decades has seen the rise of specialty coffee houses (i.e. Starbucks, Caribou), gourmet sandwiches (i.e Panera, Corner Bakery) and national upscale concepts (i.e. McCormick and Schmicks, Mortons).

Could the inequality that is being created be offset by the fact that some one can walk into Starbucks and for the price of a cup of coffee feel wealthier. The cost of meal or cup of coffee from a percent of income perceptive is negligible, however the wealth effect is substantial.

If your restaurant can find a way to make the vast majority of Americans at the lower 99% of the income strata, feel like they have experienced what the 1% of Americans at the top feel in their dining experience, than your restaurant will have bridged the Rising Inequality!

Contrast:

Robert Cialdini’s book “Influence, The Psychology of Persuasion”” offers a primer on the contrast principle.

“Sell the expensive item first then sell the accessories…if they buy a shirt first they may not buy the suit, but if they buy the suit first they will most certainly buy the shirt”

Patrick Williams of The Selling Sherpa advises “Start at The Top”

“…when people ask your price, start at the top. Trust me, if they can’t afford it, they’ll let you know. But what if they can afford it and you don’t offer it?

Starting at the top rung of your price ladder also discourages those who would make a buying decision based solely on price, and shoppers rarely become your most profitable customers.”

Seth Godin post on “Triangulation” highlights the contrast principle brilliantly,

There are two wines for sale at dinner: $9 a bottle or $16 a bottle. Which one do you order?

Now, imagine that there are three, and the third is $34. Are you more likely to buy the $16 bottle now? Most people are.”

Restaurateurs as a group have this aversion to asking top price for their offerings, why? Perceived value is a concept that relies totally on the contrast principle. A guest perception of a restaurant is influenced by their experience at other restaurants and their price points. You do not want to be the lowest price provider period.

Put the expensive items on the top of the menu. The principle of leading with your high cost, high margin items and relegating low cost, thin margin items to the least noticeable place on the menu is valid and workable. If they buy the Château Briand , they will buy sides, dessert and a bottle of wine. If they buy hamburger, they will not order sides and have water with their meal. Highlight the Chateau Briand

Restaurateurs will be pleasantly surprised when they apply the principle of Contrast!

Wham! Bam! Thank you!

Brand Autopsy post “Pick up Lines Don’t Work” offers some clear insight into how to build customer advocacy. (paraphrasing a bit)

“Restaurateurs need to stop delivering clever pick-up lines to customers and instead, start building a connection with customers.

It is not enough for a customer to be attracted to a brand. The customer must become invested in the conversation because the more time a customer spends interacting with a brand, the more likely that customers will want to begin a transactional relationship.

My advice? Be playful, be challenging, and be unpredictably predictable.

Be a playful brand. Customers do not want their brands to take themselves too serious.

Be a challenging brand. Customers want to tango, they want a give and take relationship and not one-sided take relationship.

Be a predictably unpredictable brand. Customers are turned off by complacent brands. They value brands that are willing to take calculated risks.

Keeping a customer involved in a transactional relationship is an on-going process. You cannot keep a customer on-the-shelf and simply use them whenever you need a sale. No. Customers need attention, love, cuddling, etc.”

The key that you should focus on is that the relationship is an ongoing process. To often restaurants take their guests for granted and assuming incorrectly that the guest does not need attention, the menu does not need revamping, the space does not need to be revitalized.

Customer Advocacy is a long term relationship and not a one night stand, Wham! Bam! Thank you!

One is not a Lonely Number:

Entrepreneur.com highlights the rise of One Item restaurants:

"They say one is the loneliest number, but judging by the growing number of specialty restaurants, going solo can draw a crowd. Some restaurants and food vendors are taking simple items like hummus, Belgian fries, crepes and even cereal and creating a menu based solely on them. Often, these specialty food stops feature nostalgic favorites or indulgences you simply can't pass up.

One classic making a comeback is macaroni and cheese. "We draw crowds from age 1 to 100," says Sarita Ekya, co-founder of S'Mac in New York City. "We've hooked a lot of people simply through word-of-mouth."

Less is more, sorry for the clichés, however simple is definitely better. One of the ways to get very good is to do only one thing and do it better than anyone else. Chipotle has built a brand on a very simple two item menu.

You might have an item on your menu right now that outsells everything else, or that your guests constantly talk about? Have you ever thought of spinning that item off into its own concept. The article stresses how word of mouth has spread about these locations. Customer advocacy is being created by doing one thing well.

Pizza, cereal, mac and chesse, cheesesteaks and a variety of other items are all proving that One is not a Lonely Number!

Show Time:

Patrick Williams at the Selling Sherpa Blog hit it dead on in his post when he stated:

“When it’s time to open the doors, its time to put away the personal issues and put on a show. Disney theme-park employees understand this concept very well. Outside sales professionals should also adopt this philosophy.

Anytime you are in front of the customer, they should see nothing but a professional presentation, regardless of what is going on behind the scenes.

Even when you are having a “bad day”, the show must go on. Maintain a professional demeanor at all times because you never know when you might be auditioning in front of a future prospect.

When you walk into a restaurant, you are there to resolve an issue, not to solve the staff's problems. The sooner a restaurateur understands that, the faster the restaurant will create customer advocacy. Restaurants are exactly like theater, a patron would be very annoyed if during the play the actors stepped out of character and started dealing with their own personal problems. The audience would walk out. The same thing will happen in your restaurant.

Remember when the door opens, it is Show Time!

Move in Day:

The inspectors have completed their examinations and you have passed. The furniture is in place. The paint is dry. It is move in day. You’re elated to finally bring perishable product into the space. This will be one of the happiest day’s in your business life.

The long struggle of the build out is behind you, no more contractors until the next project. The sucking sound in your checking account will ease a bit. Do not get accustomed to that. Operations can be just as challenging as a build out, but it is challenges that you signed up for. Opening a restaurant, you had no idea you had to become a contractor for six months to a year. Ahead of you lies the joy of operating a restaurant, personnel issues, menu challenges, customer service and the hope of customer advocacy.

Here comes the first truckload of produce, yes it is Move in Day!

80/20 Rule:

Wikipedia describes the 80/20 rule as:

“for many events, 80% of the effects comes from 20% of the causes. Business management thinker Joseph M. Juran suggested the principle and named it after Italian economist Vilfredo Pareto, who observed that 80% of income in Italy went to 20% of the population. It is a common rule of thumb in business; e.g., "80% of your sales comes from 20% of your clients."

Gassner Company website refers to it as the “only logic rule that millions of people rely on to help separate the "vital few" from the "useful many" in their activities”

The positivity blog does a nice job of enlightening the path by stating:

“So, focus your time and energy on those important 20% of tasks and activities that will give you 80% of the results.”

The rule has endured because it is useful across a wide variety of applications.

80% of your restaurant sales come from 20% of your customers, drill down even further and 64% of your sales comes form 4% of your customers. Identify those 4% immediately. Market to them and sell them more of the products and services they are buying. The process of creating customer advocacy finds fulfilment in this 4-20% grouping.

The legendary Jack Welch of GE fame had a revision of this rule with his 20/70/10. Jack believes that 80% of our revenue comes from 20 percent of our staff. The remaining net 20% comes from 70% of your staff, with the last 10% actually losing money for you and netting out the surplus from the 70%. That is why you need to regularly prune the poorest performing 10% of your staff, your customers, and your suppliers.

20% of the time that you spend working on a project produces 80% of the results. Time management is very important to a harried restaurateur, hence the overriding importance of prioritizing. Review your daily routine and ask yourself, is this the best use of my time? If it is not then delegate duties to others.

One of the most useful rules in business is the 80/20 Rule!

Understand your Competition:

The secret to selling is to understand your competition. If your competition offerings are in the aggregate better than yours, than why are you selling your products and services? When a customer comes into your restaurant to order corporate catering are you prepared to highlight your offerings in comparison to your competitors? You should be, you should be prepared to offer your customer more information about your competitor, than the customer would be able to obtain on their own.

In the wonderful movie Miracle on 34^th Street, the Macy’s Santa sends a customer to Gimbel’s because they have the product the customer wants. When a guest, friend, future customer advocate, or citizen marketer walks into your restaurant you must be prepared to satisfy whatever need they present. At times that need can only be satisfied by one of your competitors. For you to know that requires that you Understand your Competition!

The Dark Side:

Web 2.0 is a wondrous thing. It enables Wiki models of collaboration in a myriad of guises. RSS feeds of the collective wisdom of some of the most innovative thinkers on the planet happen daily in your Goggle Reader. You as an entrepreneur are able to broadcast your story to billions of people at virtually no cost. Web 2.0 allows this humble blog to be created and you to read it. Truly Web 2.0 is a wondrous thing.

There is a Dark Side however. A recent NY Times article “Dealing With Damage from Online Critics” highlights part of the problem:

“As the power of the Internet grows, businesses small and large find themselves confounded by disenchanted employees, suppliers and competitors who seek fertile ground to air grievances online.

Armed with little more than a Web connection and a keyboard, these detractors can do everything from irritate, via a scathing review, to causing serious business problems by using message boards to reveal company secrets or spread rumors of unethical behavior. They may also start a gripe site or register a Web address in their target’s name.

“There is all type of damage by miscreants on the Web to a business,” said Marc S. Friedman, chairman of the intellectual property practice at Sills Cummis Epstein & Gross in Manhattan. “The number of methods depends only on the creativity of the wrongdoer.”

A multitude of sites such as Yelp, Zagat, and Yahoo among others allow anyone with an internet connection to review a restaurant experience. The change here is that if you had a bad experience you would share that experience with the manager and allow them to correct the situation. Now one simply publishes their views online with no interaction with the restaurant. There are many cases of legitimate grievances that are handled in this fashion and restaurants need to adjust their responses to deal with it.

The real danger and the Dark Side that this posting is about is the nefarious grievances. Someone can post a story about your restaurant that is an outright fabrication, and because of the internet, the fabrication could spread worldwide before you as a restaurateur are even aware of its existence. It is this Black Swan that poses the greatest danger. While you sleep, the world’s view of your humble little enterprise could be totally miscast. The damage can be irreparable and your recourse is limited. Sadly people will notice a negative view far more than they will notice a positive truth. I put the question out there, how can you protect yourself? At a minimum, restaurants need to Google themselves daily to discover what might be out there.

Web 2.0 is a wondrous thing, however there most definitely is a Dark Side

The Story You Want To Tell:

Every restaurateur wants to tell a story. The story is crafted by the design of the space, the character of the furnishings, the quality of food, the warmth of the service and the overall feel of the experience. Restaurateurs believe they can guide their guest smoothly done this path. They further believe that the story they tell will be comprehended in the manner in which it was fashioned. Nothing could be further from the truth.

One never knows where a guest will enter the story and how the story will be perceived. Touchpoints are important here because the story must be authentic at all touchpoints. The telephone or online reservation, the hostess, the server, the space, the food and drinks, the valet, the physical plant, the coat check must all convey the same story.

When touchpoints are not synchronized, then the guests might not hear The Story You Want To Tell!

Celebrate:

Today is the one hundredth post of this humble blog, it is time to Celebrate!

Every day someone is celebrating somewhere. Every day that the restaurant is open is a reason to celebrate. If you need other reasons to celebrate something today in your restaurant, click on the link:

Earth Calendar

Thank you for visiting, commenting, sharing and creating customer advocacy!

Celebrate!

Some Like It Hot!

Sacha Pfeiffer’s Boston Globe article Some Like IT Hot explains the spicy trend in foods is because aging boomers are losing their olfactory senses.

“In the restaurant business, that change is well underway. Thirty-five percent of all chain and white-tablecloth restaurants mentioned the word "spicy" on their menus a decade ago; by last year that number had risen to 54 percent, according to MenuMine”….

…Chiefly because of degenerating olfactory nerves, most aging people experience a diminished sense of taste, whether they realize it or not. But unlike previous generations, the nation's 80 million boomers have broad appetites, a full set of teeth, and the spending power to shape the entire food market.”

Tyler Cowen at the Marginal Revolution blog has a different take.

“Spicy foods are addictive. Most importantly, spicy ethnic food is often better than what we had before, which indeed was usually horrible.”

Clearly the introduction of geographically diverse foods into the American diet has spice things up. Chili peppers in New Mexico, hot sauce in Louisiana, red pepper on pizza, cayenne on meats used to provide a little spice. Those are no longer enough.

It would seem that many, not just Some Like It Hot!

Over Deliver on Promises:

John Moore’s excellent book Tribal Knowledge, Tribal Truth #21

“When businesses follow through on the promises they’ve made to their customers, they’re displaying an integrity that’s necessary to building trust between customers and the brand; and they’re also showing a pride in the work they do—the products they make and the services they deliver. Ultimately, how a company follows through on its promises is more a reflection of who that company is and its reason for existing than anything else.

But delivering on promises is not enough today. Businesses, big or small, must find ways to over-deliver on their promises, implied and expressly stated, to customers. That means exceeding the usual expectations and going beyond the minimum corporate standard.”

How simple is this, the way to create customer advocacy is to Over Deliver on Promises!

99 Seasons:

The Chicago Cubs are on the verge of the extraordinary. Having been eliminated Saturday they have now gone 99 seasons since winning their last championship in 1908. One would think the law of averages would work in their favor, it has not. Everyone in Chicago was concerned that the Cubs might spoil the Hundredth year party next year by winning it all this year. Thankfully that did not happen. The universe however likes all things to tend toward equilibrium. A team’s postseason success tends to benefit sports bars and neighborhood taps at the expense of sit down casual and fine dining restaurants. The effect is also felt by other entertainment venues such as, movies, art openings and cultural events. If your team is making a run, the citizenry tend to rally around the team, eat lots of pizza, burgers, nachos, chili, hot dogs etc. and forget about finer points of pasta, seafood, salads and culture.

Now thankfully restaurant activity can get back to normal, without the disruption of a World Championship run, just like its been for 99 Seasons!

Is Everything OK?

A manager or server sheepishly approaches the table after the meal has been served and asks Is Everything OK? Why ask that question? Does not that question presuppose that something might be amiss? A restaurateur should have no doubt about the meal that she presents to her guests. I admit a bias, that question gets my skin crawling, because there is no better time to create customer advocacy and a billion times a day that opportunity is wasted. The guest will tell you if everything is not ok. Focus on the positive, start a conversation.

A better approach is:

Hello my name is Alexandria and I am the proprietor?

Congratulations Jane on that new promotion!

When people smile it brightens up the restaurant, Thank you.

May I offer you another glass of wine?

The spices in the meat were just right tonight, what do you think?

The chef is proud of the Butternut Squash Ravioli.

The Merlot is perfect with that pasta.

Accentuate the positive, engage the guest and do not ask Is Everything OK?

Cooperate or Perish:

Cheryl Jackson’ s Sun Times article on independent restaurants highlights the creative ways that are available to help market your establishment. The Chicago Originals website offers the following:

“The ChicagoOriginals exists to promote dining in local independent area restaurants, to provide diners with a unique local flavor and to raise awareness of independent restaurants in Chicago and its suburbs.”

Independents in many industries have always aligned themselves with each other to increase their buying power and marketing strength. Given that these restaurateurs have aligned a marketing strategy, what other business alignments are possible?

Independents need to find ways to Cooperate or Perish!

Holiday Gift Giving:

Ahaaaaa, the holiday season is in full gear. Most restaurant management teams have mapped out strategy to maximize the revenue this season. Corporate Catering and Private Dining Managers are out in force with brochures in hand, hoping to land the big holiday party. Along with the planning of how to book parties, a sidebar discussion about what and when to give the best customers as gifts sprouts up. Usually the dialogue goes something like this, “we’ll put together gift baskets of goodies and deliver it the Thursday before Christmas because everyone takes the Friday before Christmas off”. That is an excellent strategy to make no impact at all. The gift if it is acknowledged at all will soon be lost among the hustle and bustle.

Holiday gift giving is actually a golden opportunity to create customer advocacy and cross market a variety of your products (i.e. gift cards, delivery services, curb side pick up, private dining etc). The best time to deliver gifts to your best customers is the Friday before Thanksgiving. The timing has two distinctive advantages

1) You will stand out from the other restaurants, because they will remember your unexpected early gift. There is more time to talk to your contact and discover what other needs your restaurant might be able to fill. There is more time to get honest feedback from your customer about your performance to date and what improvements they might want to see implemented.

2) Your restaurant has all kinds of services that your customer might not know you provide. The gift visit is an excellent time to educate your customer and pick up some new business between now and the end of the year. Gifts given just before Christmas rarely result in new business because the customer has already spent their holiday dollars.

What benefits will you accrue if you reinvent your Holiday Gift Giving?

Set Your Own Price:

The band Radiohead has set the marketing world abuzz by offering music and allowing the consumer to set the price. Would such an idea flourish in the restaurant space? A first pass would yield an unqualified NO! The cost to create the music is the original investment. The distribution cost using the internet is virtually nothing. Restaurants have a huge upfront capital investment and the distribution cost is the ongoing operating expenses (i.e. labor, COGS, occupancy and a host of direct and indirect expenses). The idea would seem to have no relevance whatsoever to discussions involving restaurants.

Ignore the economics for moment and consider the dynamics of a marketplace. You the entrepreneur create value, whether a product or service and then decide on a pricing strategy for the marketplace in which you operate. To a very large degree you are surrendering yourself to that marketplace. The marketplace decides whether to purchase your product or not. You make adjustments in your price if the marketplace gives you indications that your pricing strategy is flawed (i.e. no one visits your restaurant). Allowing the guest to set the price, thus creating the equilibrium in the supply demand equation, would seem to be the logical destination for that strategy.

The Internet has created an auction economy where information is readily available and consumers make pricing decisions. That information has shifted the balance power from the producer to the consumer. Producers as a group no longer have the pricing power that they once enjoyed.

“Discussion in Theoretical Economics is always fascinating” you might be saying to yourself, “yet there is no way I can operate a restaurant with the hope that my guest will pay the correct price for my menu”. There is to my knowledge no restaurant that allows the guest to set the price today. There used to be very few restaurants that would let the guest have a menu item prepared their way. That has changed.

Let me know what you think, however the day is coming quickly when the guest will Set their Own Price!

Ambiguity:

Marc Andreesson’s post “Guide to Career Planning” offers some solid advice on dealing with ambiguity in your business

“In my opinion, it's now critically important to get into the real world and really challenge yourself -- expose yourself to risk -- put yourself in situations where you will succeed or fail by your own decisions and actions, and where that success or failure will be highly visible.

…If you're going to be a high achiever, you're going to be in lots of situations where you're going to be quickly making decisions in the presence of incomplete or incorrect information, under intense time pressure, and often under intense political pressure. You're going to screw up -- frequently -- and the screwups will have serious consequences, and you'll feel incredibly stupid every time. It can't faze you -- you have to be able to just get right back up and keep on going.

That may be the most valuable skill you can ever learn. Make sure you start learning it early.”

The single best indicator of success in entrepreneurship is the ability to deal comfortably with ambiguity. Restaurants are a daily exercise in ambiguity!

October Sky:

Top Five Chicago Pizza’s

When you are next in Chicago, you must visit one of these pizza sanctuaries. They have created customer advocacy in their own way

1) Edwardo’s

2) Burt’s Place

3) Pequod’s

4) Gino’s East

5) Caffe Baci

Pizza is Nature’s most perfect food. Pizza is Life. Pizza is great anytime especially under an October Sky!