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Yelp Has Restaurant Owners Suspicious

The online restaurant review site Yelp has become increasingly suspicious to the small business owners who the site supposedly supports.  The website is based in San Francisco, where it is also the most popular, although Yelp does post reviews about restaurants in 24 cities across the United States.

Restaurant and small business owners in San Francisco, Chicago, and New York have complained that Yelp employees use bad reviews as a way to cajole them into becoming a sponsor of the site, which costs anywhere from $300 to $1,000 per month.

Many owners have reported receiving repeated phone calls from Yelp representatives, particularly after a couple bad reviews appeared on the site’s entry for the owner’s business.

Since it is known that Yelp employees and third party contractors hired by the company have written reviews for the site, suspicion runs high among restaurateurs that Yelp is posting bad reviews as a way to get them to sign on for the monthly sponsorship fee.

For its part, Yelp denies manipulating bad reviews as a sales technique.  But the main problem is that the review ranking system on the site isn’t transparent.  Nobody really knows how Yelp decides which reviews go to the top of an entry on the site.  Sponsors paying the monthly fee are able to decide which reviews appear in the top 5, and this is the primary motivation for them to sign up.

But restaurants that refuse to shell out the money and have many positive reviews seem to be dogged by unfair reviews that consistently appear at the top of their Yelp entry.

Others pay the money, but only because they feel they have no other option to preventing bad publicity.  This is especially true in San Francisco, where Yelp is used by a majority of customers searching for restaurants and other service based businesses in the city.

One popular San Francisco restaurant, Delfino’s Pizza, has fought back by taking some of the more ridiculous negative reviews posted to their Yelp entry and printing them on T-shirts that staff wear while at work.

This subversive tactic has stimulated some good response from customers, and it raised another question about the site: how much do anonymous, unqualified reviews help or hurt a small business?

Either way, Yelp clearly has a customer relations problem, which they have begun addressing in earnest on their blog.  It remains to be seen if Yelp will be seen as a valuable asset or an annoying liability to the small businesses it covers.

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Restaurant Marketing: Can Facebook Help Your Sales?

Restaurant Marketing: Can Facebook Help Your Sales?As social media matures and becomes one of the leading elements of Web 2.0, business owners, including those in the food service industry, have started to look for ways to engage customers through sites like MySpace and Facebook.

But just how effective is it to make a Facebook page for your restaurant?

Dunkin’ Donuts launched a two-day Facebook event recently that allowed fans to weigh in on the national chain’s new line of healthy menu options, including bagels, lite specialty coffees, and healthy breakfast sandwiches.

The purpose was to engage customers, boost email signups for Dunkin’ Perks, which runs promos for local markets and reinforces national Dunkin’ Donuts messaging, and get feedback on new items.

Their Facebook page has been up for a year and Dunkin’ has 370,000 fans.  They won’t reveal how many people are on the Perks email list, but it’s at least that many.

Those are some pretty impressive numbers.  Independent restaurants are starting to get in the game as well, with more and more pages popping up for local eateries across the nation.

So are sales going to go up the minute your Facebook profile goes up?

Well, maybe, maybe not, but the bottom line is having a profile definitely can’t hurt you, and may very well help.  If you don’t start bringing in loads of new customers, you’ll at least improve retention among existing ones.

That’s because you can easily keep a conversation going with loyal customers through social media like Facebook.  A Facebook profile can be a great way to collect information about your customers and get feedback about your restaurant.  You can leverage this information to connect with customers in new ways and expand your email marketing and other campaigns.

You’ll also have a direct way to find out what’s wrong with your establishment and what needs fixing.

And as your restaurant’s Facebook page gains popularity and fans, more people are bound to find out about you as friends of your friends end up on your Facebook page.  This form of marketing is still in its infancy and remains an inexact science.

The beauty is that Facebook costs nothing but your time, and at that price a little experimental marketing is too cheap to avoid.

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A Restaurant Survival Guide (continued)

The Back Burner’s Restaurant Survival Guide continues with some more tips on how to keep customers coming in the door in these tough economic times.

Take your product to the customer. You have already developed delicious entrees, trained your kitchen staff to cook them, and purchased all the equipment you need to produce on a large scale.

Yet your restaurant is seeing falling or stagnant visits every month.

You’re all dressed up with nowhere to go.  So go out.

Many large chains like Applebees, Chili’s, and O’Charley’s have developed very successful fast takeout operations to supplement sales of their core menu items.

Now some of these businesses are getting into full catering services as a way to boost sales in a gloomy economic environment.

Recent surveys of restaurant patrons have indicated they plan to stay home in record numbers in 2009, but that doesn’t mean they always want to fire up the home kitchen.

And small to medium sized get-togethers (of 10 – 50 people) still happen all the time, just not at your restaurant.  Customers see a great value in serving familiar foods from their favorite eatery right in their home, and you already have the staff and tools to service them there.

A little marketing, a slight adjustment in your menu offerings, and you’re on your way to finding your customers even if they aren’t coming to your restaurant as often as they used to.

Gift cards help. More and more chains are marketing gift cards, and smaller operations can do the same.  Not only are gift cards a quick and convenient gift for your customer, but they guarantee future sales that can help you through slow times.

They can also help bring in new clientele if they are offered as a promotion.  And best of all, customers who use gift cards tend to overspend the gift card amount, which means some added sales for you.

Meanwhile, the customer leaves full and happy, having spent less than he or she expected.

You can survive. The salient point here is that customers still want your product.  They haven’t forgotten how good it tasted two years ago.

They just don’t want to pay the same amount for it.

You have rising expenses to deal with, but that doesn’t mean a little repackaging and some clever marketing can’t help your customer realize exactly why they fell in love with your restaurant in the first place.

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A Restaurant Survival Guide

A Restaurant Survival GuideThe current economic downturn has affected every aspect of the American economy, including the food service industry.

The NRA has projected a 1% drop in all restaurant sales for 2009 (when adjusted for inflation), potentially making 2008 and 2009 the only two consecutive years where restaurant sales have fallen since the NRA started keeping track in 1971.

That’s sobering news for any restaurateur, and many restaurant managers can tell you after a quick glance over last quarter’s books that this NRA prediction isn’t coming as a huge surprise.

But there is silver all over the huge cloud bank of gloom that is our economy, and a smart business owner should be able to hang on until the ride is over.

For starters, the food service industry isn’t hurting as badly as other sectors of the economy (at least you’re not a UAW member, right?), and typically restaurants are the first to turn around after a slump.

The key lies in holding down costs while attracting new customers and retaining existing ones.  Sounds easy enough, right?  Right.

Here’s a few food service trends that can help you survive:

Comfort foods are rising in demand. Chicken, beans, and even spam all saw significant increases in sales in the last quarter of 2008.

These products can help your business manage costs while you portray them to the customer as a “value” menu item (well, maybe not spam), especially if you highlight them against perceived “luxury” items like beef.

Put together a value menu of comfort foods to bring customers in, then hope they decide on dessert.

Divide best sellers into smaller portions. Popular menu items are always going to be popular, no matter what the economy is like.  It’s just that when your customer takes his wife out this month, he doesn’t want to spend like he did in the freewheeling days of 2007.

Many restaurants are responding by taking popular menu items and offering an appetizer version of the same thing, or a two person value platter that can be shared.

Taking your core product offerings and making them affordable to your customer is a great way to retain your faithful base while enticing new customers who are searching for value.

Stay tuned for some more Restaurant Survival Tips from The Back Burner in the coming days.

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