The Nudge Restaurant Marketing Process
In their book ‘Nudge’, Richard H. Thaler and Cass R. Sunstein claim that, every day, we make decisions on topics ranging from personal investments to schools for our children, to the meals we eat, to the causes we champion. Unfortunately, we often choose poorly. The reason, the authors explain, is that, being human, we are all susceptible to various biases that can lead us to blunder.
“Our mistakes make us poorer and less healthy; we often make bad decisions involving education, personal finance, health care, mortgages and credit cards, the family, and even the planet itself.”
The book is intense and covers a great number of ideas, but the basic concept of nudging people to make better decisions is an excellent one. It defines what HotOperator has been trying to do for nearly two decades in the restaurant industry. And, it’s proof that nudging a guest at a restaurant will work. Sadly, very few restaurant operators use ‘nudging’ to their advantage. And that leaves a lot of missed opportunities for restaurants.
HotOperator has brought together the ideas of nudging (without calling it that) for a long time. And the restaurants that use our process have benefited greatly.
But where to start the nudging process?
The HotOperator method is based on Choice Architecture. Choice architecture refers to a scenario in which the environment where someone is making a decision has been carefully designed to influence that decision. In the restaurant business, this starts with your management team and works its way down through the entire organization. It’s essential that each position in the throughput process understands the goals you’re looking to achieve and their role in achieving that goal.
The items you’re trying to influence need to be star items or have the potential to become so, and ultimately the perfect meal at your restaurant. It’s not just about getting people to step into your restaurant, it’s also about getting them to buy the right things when they do. Using the HotOperator Nudge Process is the best way to make that happen.
Next up, the menu …
Nudge Menu Development
For the past 20+ years, HotOperator has been trying to nudge their clients into a better menu. Everything from doing workshops and presentations, to working with some of the best and brightest operators in the country. The problem is, a menu that will nudge guests is more expensive than an online menu, or one that an operator does themselves. Well, that’s what they think, anyway. It’s not always the case, since most restaurant operators don’t ever evaluate what their time is worth in payment by the hour. And they definitely don’t know how to evaluate the money lost by offering their guests a sheet of paper with a list of items on it with prices sticking out to the side.
Our process for a Nudge Menu uses four basic techniques. They are as follows:
- Product Positioning. Where a product is on a menu will have an impact on how well it will sell over time.
- Highlighting. Even though there are those in the industry who don’t think menu highlighting works, it does if it’s done correctly. There is only one way to do menu highlighting right, and that is with a background color and the highlighted item lighter. We’ve done extensive research on menu highlights, and it is the only way we’ve found that works.
- Anchoring. Mental Anchoring, or Anchor Bias is a method for helping guests make a decision based on comparative prices. It is very effective in showing guests that what they really want may cost a few dollars more, but in comparison to other things in their lives, it’s really not a big deal to treat themselves.
- Numbers. Each menu item has a ‘sweet spot’ that offers the highest plate contribution while still keeping guests coming in. The biggest worry most operators have is pricing themselves out of the market. Our method finds that perfect price based on a product’s uniqueness, its quality and overall popularity in the restaurant.
If your menu isn’t using these techniques, it’s not nudging.
Nudge Server Training
When you think of your menu as a tool, you suddenly realize that it’s not as useful when it’s not in the hands of a trained expert. There are a couple of steps you need to take to make sure your staff is properly trained when using a menu. And I gotta tell you from experience, the more successful you have been over the years, the less likely you are to use these techniques.
The reason I say that is because ‘back in the day’, things were different. You could run a family restaurant in a shopping mall and make a good buck. Chain restaurants consisted of a few McDonald’s back then, and that was pretty much it. So your competition was very limited.
But today, there are chain restaurants everywhere, and they are set up to be food factories, cranking out as much product as possible as quickly as possible. Go to any larger chain, whether quick service, limited service or full service and you will see a process for selling food at a very ‘reasonable’ price in vast quantities.
So, if you’re an independent operator, you will need to be clever. Your staff will need to be friendlier, more engaging, and most importantly, know how to ‘sell’ food. Not just deliver it with a smile, but actually help a guest order the right things, add on an appetizer and dessert, and be happy they did.
The Nudge Management Process
Having a trained staff requires a trained management team. They need to be guided through the process and totally understand what you are looking for them to do.
I was training a staff recently and my process always starts with the management staff. And one of the managers at this restaurant asked me if they had to do this style of training every day. My answer was yes, every day. In fact, every minute of every day. Every second of every minute of every day. Managing your staff is making sure they are doing what they should be doing all the time.
When your staff does something correctly, tell them. Thank them. Use them as an example. When they do something incorrectly, take them aside and point out the error.
Here’s the thing, management needs to work on the business, not so much in it. Your staff is working in the business, as they should. But for you and your management team, your job is to be thinking of ways to nudge your staff and guests to make your business more successful.
Nudge Social Media
Social media is still the cheapest way to reach a wide range of people. It’s not perfect. And it still costs money. But it can be effective if used properly. Here are a few tips on nudging your guests to visit your business more often.
1 – Post nearly every day.
2 – Post about the things you want to nudge your guests to purchase.
3 – Start a conversation. Don’t just post, but talk to your guests in a way they understand.
4 – Offer promotions. Give away gift cards and offer free merchandise from time-to-time.
5 – Advertise. For a single restaurant, advertise at least $500.00 per month. If you’re a chain franchise, that’s probably not something you will have control over, but most chain operators are getting enough notoriety anyway.
Nudge 360° Marketing
Okay, if you’re up for it, nudge your way into the minds of your guests with 360° marketing. This might include billboards, posters, bus stops, mass transit advertising, table talkers, radio and even podcasts. But it’s not just about spending the money. It’s also about the creative behind the messaging. Do not allow the radio station or billboard company to make you an ad or billboard. They will screw it up. Get an agency (and make it a good one) to do that work for you.
The Nudge of Mark
If you need help coming up with ideas on how to nudge your guests, give us a call at 800-316-3198! Mark Laux can be found here: http://www.hotoperator.com/contact-us/