British restaurateurs are being advised to adopt the imaginative promotional offers used by American businesses in order to continue attracting diners during the recession.
In a recent trip to the National Restaurant Association (NRA) Restaurant, Hotel-Motel Show in Chicago, Horizons’ managing director Peter Backman found American restaurants were successfully using a range of promotional deals that UK businesses were not.
They include offering starters as main courses for the same price; a free takeaway meal with every one eaten in the restaurant; loyalty programmes where points can be swapped for a free meal; and even cheap meals for dogs.
Backman reported a successful offer launched at the 80-strong Daphne’s Greek Caf? chain, where the price of a popular soup was reduced from $3.19 to $1 when ordered with a main course. The deal was said to have increased sales 10-fold.
“Like the UK, the American eating-out market is suffering severely,” said Backman. “Operators are being very clever with their offers to keep people eating out, and are reporting that consumers are remaining loyal to outlets that offer value, and that’s not just about lower prices.
“Restaurant chain operators in the UK have been heavily promoting 2-for-1 meal deals, which, while attracting customers, reduce margins. This is OK in the short term, but it can damage finances if used for too long. That’s why it’s important to think imaginatively about what to do to attract additional traffic, increase turnover and protect margins as much as possible.”
Backman also found that American diners were ordering ‘more modest meals’ in an effort to be healthier, with small sharing portions such as tapas, mezze, dim sum and combo salads becoming more popular.