If you're heading out to dinner with the family this long weekend, order some dessert. That's what we found in this February 10 piece: Economically speaking, you might be getting more bang for your buck. Desserts are not that profitable for restaurants, not only because they can't charge that much, but because it's time for you and your family to linger while each enjoying—or perhaps, more likely, sharing—a single slice of cheesecake or key lime pie. Read on to discover how restaurants are dealing with the bad economics of desserts.

If you think you're doing a restaurant any favors by ordering dessert, you might want to think again.
Dessert can be delicious. And it can be profitable, too. But generally speaking, when diners extend their meal with slices of chocolate cake, cups of ice cream, and servings of crème brûlée, it can come at restaurants' expense.

"It's hard to make money on desserts in the restaurant business today," said Tyler Cowen, an economics professor at George Mason University who has written extensively about the economics of eating out. "I don't think many [restaurants] benefit when people order them anymore."

There are many problems with dessert, but it all starts with one pretty simple truth: The restaurant industry is a place of razor thin margins, and dessert tends to offer one of the thinnest.

Food in general is tough to make money on. Restaurants have long relied on the mark-up they tack onto drinks, not grub, to boost profits. As food costs soar, that reality has only become more true, because there's a limit to how much people are willing to pay for different parts of their meal. For many mid-scale restaurants, that limit is $30 for entrees, no matter the ingredients, Todd Kliman noted recently in the Washingtonian. For desserts the ceiling is much lower, and much less flexible, says Cowen.

"Dessert needs good ingredients to taste good, but you can't psychologically convince people to pay even $20 for dessert," Cowen said. "You can't really go cheap on it, but you really can't charge extra either."

Forbes, for that very reason, noted in 2011 that dessert is often a great deal — for diners.

But it's also made serving it a growing pain for many restaurants. The cost of serving a house-prepared line of desserts includes employing a pastry chef and dedicated space in the kitchen to the craft. Some restaurants, instead of using pastry chefs, have opted to serve simpler desserts made by line cooks, while others "have given up entirely" and outsourced their sweets, according to Kliman.

Dessert is also problematic for restaurants because the course creates a bottleneck at the end of meals. At restaurants serving food in some of the country's busier cities, turnover is essential to their bottom line. Time is quite literally money.

"The more people they serve, the more revenue they get," Cowen said. "A lot of restaurant costs are fixed. Being able to serve more people, to sell them food, drinks, and especially expensive wine, is what varies."

Parties that might have finished their dinner in a little over an hour instead linger for closer to two when they opt for dessert. And they stay the extra 30 minutes while consuming only a fraction of what they did during the first part of the meal. It would be different if people ordered drinks more often alongside cake, but they often don't. It would change things if dessert wines were more popular, finer and more expensive, but they aren't, Cowen said.

"A cocktail brings in twice as much money as a dessert, and it doesn't hold up a table at the end of the meal. You have to turn the tables," Mark Bucher, who owns D.C. restaurant Medium Rare, told Kliman.

Dessert isn't, of course, problematic for all establishments. Restaurants with slower traffic, where open tables are less of a rarity, would obviously prefer to sell more food than sell no food. Higher-end restaurants, where prices are less elastic and people are willing to spend well over $20 for a dessert, aren't as affected either. It's the popular, mid-priced restaurants that don't benefit as much.

Desserts aren't going to disappear from restaurant menus. Too many people like them (rightfully so, I would say, though Cowenbegs to differ). People also expect them, which makes eliminating them a risky endeavor. The price of alienating people is probably too great, especially in the age of Yelp reviews.

But the next time a waiter is being coy about showing you the dessert menu, know why: He probably would prefer it if you and your party asked for the check instead. Unless, that is, you might be interested in another round of drinks.

Source: https://www.washingtonpost.com/news/wonk/wp/2015/12/30/why-many-restaurants-dont-really-want-you-to-order-dessert/

Behind the swinging doors of restaurant kitchens around the country, things are getting a bit more chaotic. It’s not the sort of thing diners would have noticed, because it’s happening behind the scenes, out of view. Orders are still coming in, and plates are still coming out. But there’s a growing problem that chefs and restaurateurs are talking about more these days.

Good cooks are getting harder to come by. Not the head kitchen honchos, depicted in Food Network reality shows, who fine-tune menus and orchestrate the dinner rush, but the men and women who are fresh out of culinary school and eager.

The shortage of able kitchen hands is affecting chefs in Chicago, where restaurateurs said they are receiving far fewer applications than in past years. “It’s gotten to the point where if good cooks come along, we’ll hire them even if we don’t have a position. Because we will have a position,” Paul Kahan, a local chef, told the Chicago Tribune last week.

It’s also an issue in New York, where skilled cooks are an increasingly rare commodity. “If I had a position open in the kitchen, I might have 12 résumés, call in three   or four to [try out] in the kitchen, and make a decision,” Alfred Portale, the chef and owner of Michelin-starred Manhattan restaurant Gotham Bar and Grill, told Fortune recently. “Now it’s the other way around; there’s one cook and 12 restaurants.”

And it extends to restaurants out West. Seattle is coping with the same dilemma. San Francisco, too.

The glitz and glamour of rising through the ranks in the restaurant industry isn’t what it used to be. Long hours, low pay and a series of other cultural and economic factors have made lower-tier restaurant work a much less desirable path than it once was, leaving many kitchens chronically understaffed.

One of the clearest obstacles to hiring a good cook, let alone someone willing to work the kitchen these days, is that living in this country’s biggest cities is increasingly unaffordable. In New York, for instance, where a cook can expect to make between $10 and $12 per hour, and the median rent runs upward of $1,200 a month, living in the city is a near impossibility. As a result, people end up living far from the restaurants where they work. Add to that how late dinner shifts can end, causing people to arrive home well into the night.

Top it all off with the fact that culinary school graduates are often working through significant amounts of debt, and the burden can be insurmountable.

It’s not as if restaurants are cheating workers out of heaping piles of cash, either. There simply isn’t a whole lot of money circulating. The National Restaurant Association estimates that the median profit margin for mid-level establishments (those with average checks of $25 and higher) was 4.5 percent. Celebrity chefs and successful restaurateurs exist, but they are the exception. And a good deal of the money earned by the former comes in the form of television contracts, book deals, guest appearances and other tangential earnings.

“The pay just isn’t there,” said Kim McLynn, a representative for industry research firm NPD Group.

Some also worry that food television has created a pervasive, mistaken perception among young, aspiring chefs that success is earned less through patience and perseverance than it is through sudden fame. Cooking shows on the Food Network, Bravo and elsewhere, have spread a misleading sense that kitchen work is mostly creative and fun. The reality check that young cooks experience at their first kitchen shift can be crippling.

“It’s tiny and hot, not much room to move,” Andy Ricker, the chef and owner of Pok Pok in New York told Grub Street in 2013. “You’re dehydrated, and it’s crazy busy; the floors are greasy; there’s flames and water. It’s not like being in Kitchen Stadium.”

And then there’s another subtle but significant change happening across America that doesn’t bode well for the restaurant industry. After years of steady inflows of Mexican immigrants, who have proved both eager and talented cooks, the trend is reversing itself. The number of unauthorized immigrants living in the United States has leveled off over the past decade (it peaked eight years ago in 2007). By 2012, net migration to Mexico was already zero, or even negative, meaning that more Mexicans were moving out than moving in.

That’s terrible news for an industry that has relied on the demographic. In 2010, the Bureau of Labor Statistics estimated that 1.4 million out of a total of about 12.7 million workers in the restaurant industry were immigrants. In 2008, the Pew Hispanic Center estimated that about 20 percent of the country’s more than 2.5 million chefs and cooks were undocumented immigrants.

“I would be surprised if the slowdown in Mexican immigration isn’t responsible for more of the problem than many people realize,” said Tyler Cowen, an economics professor at George Mason University who has written extensively about the economics of restaurants. “This sector is, as anyone in it will tell you, kept afloat by immigrants, especially Latinos.”

Cowen said that he thinks the improving economy is hurting the restaurant industry. As other sectors pick up, service jobs suddenly become less appealing, he said.

“Improving economy, declining immigration and higher rents — those are the three main things creating the shortage of cooks,” Cowen said.

Despite the issues affecting the industry, new restaurants continue to open, which could be exacerbating the problem. Just as the pool of potential candidates is thinning, more kitchen jobs are opening up, creating a growing supply and demand gap.

The National Restaurant Association touched on this phenomenon in its latest industry forecast. “Growth in the number of hospitality job openings accelerated sharply [in 2014], a development that was out of sync with the pace of hiring,” the report said.

If the trend continues, it will only be a matter of time before the problem spills out into the public, slowing service, deteriorating meal quality and, perhaps, forcing restaurants to close their doors.

Source: https://www.washingtonpost.com/news/wonk/wp/2015/08/12/the-crippling-problem-people-who-eat-at-restaurants-havent-noticed-but-chefs-are-freaking-out-about/?postshare=6591451190725148&tid=ss_fb-bottom

When you own or manage a restaurant, you likely wear multiple hats. Your primary concern is ensuring your customers enjoy a high quality meal and leave to share their experience with their family and friends. You manage your employees, prepare the food, keep the books, handle supply, and interact with customers. When each day is over, the last thing you have time to do is develop and actively maintain an effective marketing strategy. Perhaps your social media presence has been nonexistent, or your once loyal customers are not returning as often as you would like.

This may sound like a lot to balance, and it is, but today there are marketing techniques that won't break the bank and will help you save time. Use these restaurant marketing ideas to take your business to the next level in 2016.

• Take loyalty seriously — Did you know it costs a business 5-7 times more to acquire a new customer than it does to sell to an existing one? Not only that, but on average loyal customers spend 10 times more over their lifetime. By taking customer loyalty seriously and offering customers the ability to earn rewards for visiting your business, you'll be able to retain your most profitable customers and allocate resources you might have wasted on customer acquisition, to more value-add activities.

• Build a simple, elegant website -- Almost 50 percent of restaurant website traffic takes place on mobile devices, according to a Gourmet Marketing.com article. Restaurants that offer responsive mobile websites convert up to 64 percent of searchers. There are many high quality DIY websites that enable restaurants to build their own mobile friendly websites like Squarespace and Wix. Website content about you, your restaurant and your multitude of seasonal menus should be limited to only a few, clearly defined options (e.g. menu, order, contact, locations). Mixed Greens, a local business in Chicago, gets an A+ for website functionality and design.

• Grow your customer review bank -- Your reputation can make or break your business. The sheer volume of reviews doesn't really matter. Instead, the number of positive reviews becomes your restaurant's lifeblood. Sites such as Yelp, Urbanspoon and Zagat provide a medium for customers to express their likes and dislikes about your food, ambience and customer service. According to a survey conducted by Dimensional Research, people who had a poor interaction were 50 percent more likely to share it on social media than those who had a good experience, and 52 percent were more likely to share it on an online review site such as Yelp. Be sure to stay on top of your business's reputation by responding publicly to all reviews. You should also give your most loyal customers the ability to review your business on Yelp — increasing the likelihood that they'll leave a positive review!

• Become a social media medium -- The number of social media outlets customers' have available rivals the number of Crest toothpaste options found at your local grocery store (last count was 38 at my local store). It's important not to get lost in the myriad of options but instead, remain focused on nurturing the ones that matter the most. Once you've created a Facebook page and Twitter handle for your restaurant, focus on gathering more "Likes” and "Tweets" by driving customers to talk about their visit online. There are also quite a few social media management tools available to help you manage your social media presence, including Sprout Social, Hootsuite and Buffer.

• Gather data on your customers — It is not 1995, yet some restaurants continue to have customers drop their business cards in a fishbowl or hand write their email addresses on a piece of paper at the register. Or better yet, some restaurants collect absolutely no information about their customers. Gathering data about your customers is no longer optional in today's highly competitive, online world. Offering a digital loyalty program brings traditional offline data-gathering methods online by allowing your restaurant to collect actionable data on your customers and make decisions that positively impact your business.

• Participate in the on-demand economy -- According to Mike Jaconi, contributor for Business Insider, the on-demand economy is defined as "the economic activity created by technology companies that fulfill consumer demand via the immediate provisioning of goods and services." Companies such as Postmates, GrubHub and Caviar are worth considering because of their ability to extend the existing reach of local restaurants and to have a positive impact on labor allocation toward food delivery and on-demand ordering.

• Use mobile to gamify customer experience -- It's no secret that we all love our smartphones. As customers, we live in a much more mobile world compared to a decade ago. By embracing the mobile trend, restaurants that partner with loyalty apps or offer their own app are seeing an increase in engagement and activity that can lead to stickiness, deeper connections and greater loyalty. For example, Tropical Smoothie was able to decrease time between customer visits by 50 percent by surprising and delighting their customers. Using their loyalty program, they emailed their customers to visit for a chance to win a free smoothie.

• The farm-to-table and local fresh wave is here to stay — By not offering your customers locally sourced food products, you're missing out on a two-sided advantage on which other restaurants that do offer local are capitalizing. From a food perspective, providing locally sourced ingredients means you're offering customers fresh, high quality ingredients that generally command higher prices and better margins. From a marketability perspective, offering farm-to-table ingredients means the perception of your food quality is much higher than it otherwise would be. Additionally, you create the perception that you're building goodwill within the local community by supporting small local farmers. Restaurants that offer farm-to-table options and that source many menu items locally include Farmhouse in Chicago and Redbird in Montana.

• Offer online reservations -- If you currently don't offer a way for customers to book reservations online, you should consider signing up for an online reservation like OpenTable. Online reservation tools provide new and existing customers with a fast and easy way to book new reservations, change reservations and share their experiences.

• Allergen friendly and gluten-free — The point here is to expand your audience — continue to cater to the majority of us without food allergies — but now find select partners to source allergen-friendly options that make it possible for the family of four who has a child with celiac disease to enjoy food at your restaurant. You offer whole-wheat pasta on your menu, so why not also offer brown rice pasta? Offering allergen-friendly and gluten-free options doesn't have to be a yes or no, black or white decision. It is possible to safely provide alternatives either made in-house or sourced from certified allergen or gluten-free partners such as Sweet Ali's Gluten Free Bakery or Defloured.

Source:  http://www.fastcasual.com/articles/10-fresh-restaurant-marketing-ideas-for-2016/

When the Internet was new to consumers, everyone loved email. One of the best parts of logging onto AOL was the knowledge that after minutes of agonizing squeals, you'd be treated to that wonderful phrase, "You've Got Mail!"

But after a couple decades of Nigerian prince schemes, Spanish lotto scams, and mountains of unsolicited spam (which is never a good marketing tactic), how do people feel about email now? Is it still a worthwhile tactic for small-business owners and marketers to pursue?

The simple answer is yes. But you came here to learn, so here are the Top 5 research-backed reasons email marketing is vital for businesses of all sizes:

1. Email is an easy way to reach mobile customers.
One reason email marketing has value for business owners is that it's an easy way to start reaching consumers on mobile without investing a lot in new technology or software. According to an April report from Pew Research Center, 52 percent of US cellphone owners access their emails from their phones. Email marketing also works with other mobile devices. In July, Forrester Research released a study that found 42 percent of retailers' email messages were opened by consumers on their smartphones and 17 percent were opened on tablets. This means that nearly three out of every five email marketing messages doubles as a mobile marketing message. Using email is better for mobile marketing than SMS because:

1. It works on mobile devices other than phones
2. Emails are free for the consumer, whereas texting may incur a charge
3. Emails have far more space for content than text messages, allowing for better marketing pieces.

2. It's an effective way to keep customers informed.
Email marketing isn't something marketers do just because they can and it's easy. The tactic is very effective at helping business owners and consumers stay connected. In fact, consumers often seek out email marketing campaigns from their favorite brands and local stores. This goes beyond coupons (which we'll discuss next). Nielsen reported that 28 percent of US online shoppers subscribe to store or product emails in order to stay informed. A study from Loyalty 360 stated that 59 percent of US moms would sign up for email updates from brands if rewards were offered. And email marketing can be used as a way to deliver content to consumers. A 2013 study by the Relevancy Group noted that marketers who add video to their email campaigns see an average rise in revenue of 40 percent. There is a real value to staying connected to customers and email marketing makes that easy to do.

3. Email coupons drive online and in-store sales.
The Nielsen study mentioned above also found that 27 percent of US online shoppers subscribe to store or product emails in order to save money. This conclusion is backed up by recent data from Deloitte that found 65 percent of consumers say email coupons are important when grocery shopping online. Similarly, Shop.org reported 64 percent of US Internet users have printed a coupon from an email. Though consumers are looking to save money, it can turn into increased revenue for the retailer. E-coupons are big business, and email marketing is at its heart. The number of mobile coupons used is estimated to double over the next five years to reach 1 billion people. Email marketing is a good way to start reaching the growing number of online bargain hunters. The big brands are already using this tactic for that purpose. BIA/Kelsey reports that 36.6 percent of national businesses use email marketing for local promotions.

4. It's easy to customize and integrate into other marketing tactics.
The versatility of email marketing is another reason marketers should keep the tactic in their marketing toolbox. Depending on the depth of the email database and the skill of the crafter, email marketing messages can range from simple to very complex. Emails can be personalized to include the name of the user and even more. A small study of 139 marketers from Retention Science found that websites use several kinds of personalization tactics that can easily be applied to email. Nearly half of US online retailers used personalized product recommendations (44.9%), about a third added the customer's name and/or a unique welcome message (31.5%), and a quarter of the respondents reported adding shopping cart reminders (27.6%) to cover all of their personalization bases. Email marketing can also be utilized with just about any other marketing tactic, which makes email an important part of any integrated marketing campaign.

5. Email marketing is inexpensive. 
To sum up the best reason to use email marketing: It's easy, effective, and inexpensive. Email marketing allows business owners to reach a large number of consumers at a rate of pennies per message. For small-business owners on a budget, this makes it a better choice than traditional marketing channels like TV, radio, or direct mail. You don't have to take my word for it. A joint study from Shop.org and Forrester Research found that 85 percent of US retailers consider email marketing one of the most effective customer acquisition tactics.

The point of all this is that email may be an old tactic, but it remains a vital one. It's relatively easy to get started with email marketing, so there's no excuse for business owners to not be taking advantage of the tactic. Understandably, business owners may be too busy to handle the email marketing on their own, but this is something that any Web marketing professional (wink, wink) can help with. For more information on email marketing, read 10 more stats that show email marketing is still worthwhile and 5 stats that will make you a better email marketer.

Source: http://www.inc.com/peter-roesler/top-5-reasons-why-email-marketing-is-still-works.html

What are the steps to storytelling success? Chipotle and others shared specifics on what works.

1. Have a clear position.
When Dominic Losacco came onboard as VP of global marketing for Moe’s Southwest Grill in July, he set out to further push Moe’s brand story to build an emotional connection—and brand loyalty—with consumers. “The first step for me is to have a clear brand position, what you stand for,” he says. Having a specific definition to execute against helps tell a more effective story, he says. For Moe’s, that means incorporating its desire to “celebrate originality” into its messaging. The irreverent spirit of that mantra is what the Moe’s name literally stands for—an acronym for Musicians-Outlaws-Entertainers. “Moe’s should always have that irreverent tone, because that’s part of the brand’s history.”

For 31-unit Sweetgreen, co-founder Nicolas Jammet wanted the healthful fast casual to have a clear purpose. “It’s not just about the transaction or the food you were being served. It’s about more than that. We want to celebrate the healthy lifestyle and how food fits into that,” he says. For more on the elements of Sweetgreen’s brand story, click here.

But that positioning doesn’t always have to be a lifestyle statement. “It’s about being true to what you really are and executing a solid brand positioning,” says Wetzel’s Pretzels CEO Bill Phelps, who admits it’s a challenge to get people to care about a snack food like pretzels. “What we believe is you have to be consistent for what your brand really is, with one message about who you are. Don’t try to be something you’re not.” 

2. Keep the story simple
“Consumers are inundated with information today, so the simpler the message, the more powerful it can be,” says Jammet. “For us, every touch point, whether it’s experiences (such as the chain’s music festival or community outreach) or the launching of a seasonal menu, tells our story.”
At Wetzel’s, simplicity doesn’t just resonate, it sells. When the QSR revamped its digital menu board, doing away with text in favor of pictures of five best-selling items and an animation of its Wetzelmen mascots creating its product, it saw sales jump. “It’s incredibly simple and so clear to the customer,” says Phelps.

3. Consider how consumers see the brand
Before retooling Moe’s marketing, Losacco’s predecessor conducted internal and external research to see where the concept fit, both in the marketplace and in consumers’ minds. Knowing how an audience sees the brand helps tailor the message, says Losacco. “There are some brands out there that need to reeducate the consumer on their history, and there are other brands that can focus on telling where the[concept] is positioned and headed … It depends on where the brand is with consumers and in the marketplace to know which tactic will work.”

It’s also key to be clear about what consumers’ opinions mean. Wetzel’s conducted focus groups to understand how customers viewed its brand. “If someone is going to Chipotle, they are thinking about the purchase. Thinking about food and integrity. When buying a pretzel, it’s an impulse decision. We understand that. So we make it a simple, fun experience,” says Phelps. That ease is part of the brand picture Wetzel’s is trying to paint on its menu board. “It’s a fun, hip brand that’s fresh,” he says. 

4. Stand for something
“It’s not about history; its about ethos,” says Chris Arnold, Chipotle's communications director. Chipotle’s ethos, he says, is to change the way people think about and eat fast food. The core of that is respect and knowledge of farmers, animals and the environment. “Having that ethos gives us a lot of compelling stories to tell,” he says. And it does so through YouTube videos, music events and in-store materials such as essays on its beverage cups. “While we have a great many customers who don’t know all of the details of our food culture, we have a growing percent to whom those things really matter. It engenders great loyalty.”

5. Build trust“Be really careful with everything you tell customers,” says Jammet. “The best brands are the ones that are built on trust, the ones that can really build trust with the consumers.” For Sweetgreen, that means transparency. “Customers have really come to trust where we get our food and what we do,” says Jammet. Sweetgreen menu boards list every ingredient and producer, and guests also can look into the kitchen to see food prep, he says. But, “trust is earned in drops and lost in buckets,” he cautions. “It takes a long time and a lot of factors to build trust. You can mess that up with one swoop.”

6. Strike a balance
Chipotle’s marketing efforts are threefold: local marketing, traditional “top-of-mind” advertising and its “Cultivate” program that puts out vision-oriented stories, such as its viral Scarecrow YouTube video and mobile game, that may or may not be branded. “We get a lot of attention for [programs] that fall into the “Cultivate” bucket, but in terms of marketing spend, those three are pretty equal,” says Arnold.

He admits, though, that overall, Chipotle is a fairly small marketer. The category average, he says, is to spend 5 to 7 percent of revenue on marketing; Chipotle spends about 1.75 percent.

Moe’s, too, tries to strike a balance between traditional food-driven advertising and storytelling. “Because of the way the media landscape is now diversified, you have an opportunity with customers to tell your story in different places,” says Losacco, though he cautions that operators must be cognizant that the message fits the medium. Moe’s hasn’t gone completely away from TV and radio, but it’s become more engaged in the social media space. The key, says Losacco, is to make sure all of your messaging, wherever it lies, works together to build a brand story and emotional connection.

7. Be adaptable
The consumer landscape is constantly changing, says Losacco. “Brand positioning isn’t necessarily something you change on a daily basis, but you always have to adapt and evolve how you communicate.” Over the last few years, Moe’s has been more tactical in its communications strategy, especially as it has gotten more involved in social media messaging. It’s learned, for example, to be diligent and strategic when posting. “The frequency of brand posts or tweets is really critical … make sure it is timely and relevant to consumers’ daily lives.”

Source: http://www.restaurantbusinessonline.com/ideas/marketing/7-tips-tell-your-brand-story-chipotle-way