Don’t stop marketing, Part 1: Making Dough with Diane

When restaurants are facing tough times, the first thing they do is to stop marketing their operation.
Many marketing experts, including myself, will tell you that when facing economic tough times the first thing that restaurant owners usually do is arbitrarily cut marketing costs. But doing so can be a bad business decision that can prove disastrous that may leave your brand in a less competitive position when the economy recovers. It has been proven over and over that cutting marketing and advertising during a downturn will delay your recovery.

Many pizzeria owners will behave the same way. Fearful of declining revenue, they will typically cut costs – including marketing costs – reduce prices and postpone new projects. It’s a normal reaction. However, marketing and website improvements are not the things you should suspend right now. Budgeting for marketing and advertising is as necessary as budgeting for your electrical bill or your payroll. It’s not the time to cut promoting, advertising and marketing. Over the years, research studies have confirmed that the best strategy in terms of long-term return on investment is to either steadily continue or aggressively increase marketing spending during an economic downturn. In previous recessions, restaurants and pizzeria operations that continued to invest in marketing saw an overall growth in their businesses at the expense of the competition, while those that stopped their budgets saw a decrease in sales. You should always be marketing to new potential customers as well as to your existing customers.

Here are four out of 10 points to think about to market your pizzeria during a slowdown.

1. Advertising or promotion?

You may think that these two words mean the same thing, but they do not. Advertising is a one-time communication: it is something you would do to promote your pizzeria business, products or services such as an ad in a magazine, TV or radio commercials, and website banners. Promotion includes all the particular activities and ways available that are intended to announce or promote your business, products or services. Examples include team or league sponsorships, contests, events, coupons, social media and direct mail. Promotional campaigns are often done to get the media to promote your message at no cost. Promotions usually don’t cost a lot of money, as advertising does, and you may want to do some daily promotions. Don’t forget to get involved in charitable events, whether by hosting or sponsoring, which will be a great way to create a positive attitude about your pizzeria in your community. The result in doing both – advertising and promotion – at the end is to create brand awareness, attract new customers and increase your sales.

If you suddenly decide to stop all marketing, you will have to start over by building momentum from zero. If your customers haven’t heard from you in a while, you will have to work twice as hard to get their loyalty back. Rather than suddenly stopping your marketing efforts, you are better off maintaining or even increasing your efforts to make sure that you are in a position of strength when this economic downturn passes. Just remember that increased spending in marketing and advertising during a downturn will pay off exponentially in the months and years to come. I certainly believe that you should keep marketing during an economic downturn, especially if your competitors aren’t!

2. Evaluate, analyze and check everything right away

It’s important you spend your marketing budget wisely. You need to know how much you can spend. You also need to have a strategy on how to spend it, where to spend it and what you want to achieve. It’s also very important to understand that any purchases depend on consumers’ having disposable income, feeling self-assured about their future, and trusting in business and the economy. You should definitely analyze your POS data for food-cost savings. Decide which menu items you can temporarily eliminate (products ordered less frequently) and which products your most loyal guests tend to buy. What can you offer right now that no one else can? Can you think of some creative and unique ways that you can help your customers?

2. Pay special attention to your existing customers and care about new ones

Your pizzeria brand’s biggest asset during an economic downturn will be its existing customer base. Your marketing strategies should focus on your most valuable and loyal customers. Happy customers will always help you back by recommending your pizzeria and posting reviews on social media platforms. The importance of honest communication with your customers cannot be overstated. Find out what kind of customers come to your restaurant, get to know them better and find out what they want. Asking each customer what they would like to buy would be a good strategy. Develop meaningful relationships with your existing customers and, most particularly, with your new customers. Customers do appreciate when employees care about their experience and make them feel welcome. It’s important to try to do everything to make your customers’ lives as easy as possible. Studies show that customer service may be greatly improved and that consumers will get better service after this crisis. Call, email or send a card to your best customers. Tell them that you appreciate their loyalty and continued patronage. Just remember that word-of-mouth marketing is still one of the best ways to attract new customers to your pizzeria.

3. Emphasize family/friend meetings, values

When there is an economic downturn, people tend to retreat to familiar, cosy down-to-earth places. They tend to stay home and surround themselves with homemade and less expensive food, friends, and good family fun. A lot more company employees will work from home, and because most businesses are discouraging travel, the confined population will probably go stir-crazy. As more and more people choose to practise social distancing, the need for a human connection will never be greater. The strong desire to connect with others and their go-to local restaurants will only become stronger. People like to do business with people and businesses they know. This could be an opportunity for people to want to connect and help one another out, and they will need a place to meet. This is will be a great opportunity to turn your pizzeria into a community hub with cosy fireplaces and warm smiles. Market your pizzeria as a safe place to meet. A welcoming restaurant is a magical place that people need at the time of crisis more than ever: they need a peaceful place to escape. It’s also a perfect place to provide them with an inexpensive workplace with free Wi-Fi. Get in touch with your local customers and encourage them to come in for a special lunch promotion or an afternoon treat. Making your pizzeria a genuine place of social gathering will help foster a much-needed sense of community and will probably end up turning these customers into long-term customers.

4. Fine-tune your product offering

With this current economic situation, you may be faced with budget cuts and tough decisions in the months ahead. As they say, “less is more!” As you know, purchasing behaviour changes dramatically during economic downturns. It’s the right time to get creative with your menu, pricing strategies and product mix. Don’t throw everything out the door as people will not stop buying small snacks, appetizers, junk food and other small treats. It’s a known fact that at a time of economic downturn, people tend to visit chocolate stores more often as they crave sweetness. It has been well documented that sales of chocolates rise when times are tight: it calms your nerves and stress by giving you that sugar rush. How about launching your first-ever chocolate dessert pizza? You could make these pizzas with toppings such as chocolate sauce, dark chocolate chips, milk chocolate shavings and white chocolate chunks – all on a yummy chocolate crust. If Dr. Oetker can make these sweet pizza treats, I believe that this is something that you could definitely add to your product mix.

Perhaps the best quote about advertising in a recession came from Sam Walton, the founder of Wal-Mart. When asked, “What do you think about a recession?” he responded, “I thought about it and decided not to participate.”

Be sure to read Part 2.

Diane Chiasson, FCSI, president of Chiasson Consultants Inc., has been helping foodservice, hospitality and retail operators increase sales for over 30 years by providing innovative, revenue-increasing marketing strategies. Contact her at 416-926-1338 or chiasson@chiassonconsultants.com,
or visit chiassonconsultants.com.