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The Chains are Winning, and it's all in the Marketing
In conversation after conversation with independent restaurant operators
concerning the proliferation of chains, it's usually the same line of
thinking. "My food is one-hundred percent better, my service is better,
and you can eat here for pretty much the same cost. It's a shame -
people just don't appreciate fresh food, and simply don't know any
better."
But guess what - they ain't going for the food, and they don't believe
for a second that your prices are competitive with those of their
favorite chain. And while the independent guy continues to make sense,
he continues to lose business to his glitzy (any extremely annoying)
neighbors.
The war isn't being fought in the kitchen, it's being won in an office
several doors away from the President. They call that person the
Director of Marketing, and he or she is responsible for spending the big
bucks in radio and television, and those beautiful four-color print ads
that can make a hamburger place look like a DiRoNa Award winner.
When it comes to marketing, the independents simply can't compete with
the chains, because when it comes to advertising, money wins, and by
definition, the independents can't compete. One guy is talking about
his "word of mouth" advertising, and the next guy is spending millions
on a national TV campaign. And people do watch lots of television, and
they are absolutely influenced by advertising.
The independent guy sits down with his local newspaper rep, and together
they hammer out next week's advertising. The other guy is busy flying
to New York to meet with the ad agency and to critique his new fall
marketing campaign. It's not a level playing field.
The best proof that advertising works is that customers stand in line at
the chains, and guess what - according to the Thomas Register FoodTRENDS
'97 survey to some 200 chain executives, 2% of those customers are
concerned about the quality of the food and the service. 2%!!! I
seriously doubt that this means that 98% don't care, but I take this to
mean that the overwhelming majority of chain customers are just assuming
that the food and service is fine. What's really important to them is
the cost and the atmosphere, (and all that fun as portrayed in the
commercials).
Now the good news, because there is an answer to this competitive
disadvantage (which is extremely difficult but not absolutely
impossible). The independents simply get together; ante up a few
dollars, and hire their own ad agency. Their campaign zeros in on all
the things that make dining out so enjoyable. Chefs; owners, live and
in person; fresh food; great service; etc., etc. Tell this story with
all the power of modern marketing, and you get "standing room only."
And just in case you think this concept is insane, we just had lunch in
one of the nation's best restaurants, and discussed this very idea (an
independent advertising campaign). Their reaction was "let's do it, and
you can count on us as the first participant." And the journey of a
thousand miles begins with one step...
Page One (James, Lito Benitez, Lyndele von Schill, Sally O'Brien, Ray)
Independent Restaurant Survival in a Mega-Chain World - By Ron Gordetsky & Kate Lange
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Independents