Many new restaurant business owners believe that what makes a successful restaurant is the quality of the food that they serve. Of course, this is true, but good food alone will not sustain a business in this industry. There is more to it: like a proper balance of excellent products and services, combined with equally brilliant marketing strategies. These are all implemented hand-in-hand, with a focus on improving your restaurant’s ROI (Return on Investment). How can your business achieve this? By today’s trends in technology, you can easily measure the impact and effectiveness of your online marketing campaigns through data.
We emphasized the need for businesses to track their marketing campaigns, which you can read here.
Laying It All Out
Marketing options for a restaurateur are numerous, and may seem confusing or intimidating, especially if you have little knowledge of new digital marketing platforms. How and where to invest your marketing budget will likely affect your ROI, so the logical step is by consistently appraising and monitoring your marketing campaigns. You can try out marketing analytics tools which can provide you with important insights and guide your marketing campaign strategies and be wiser in spending on which works best for your business.
Want to try out Maralytics? Then sign-up for a free trial, here!
Before you come up with how you can improve on your ROI, you must already have these 3 vital aspects in place:
1. Marketing Strategy
Your restaurant’s marketing plan, outlining your campaign and individual efforts, make-up your strategy. It is the culmination of all your marketing activities for the year. From traditional promos and specials, to email and social media marketing, your strategy provides a solution on how to get seats filled-up alongside gaining profits.
2. Your Calculated Budget
There is really no fixed amount as to how much you should allot for your marketing budget. There are numerous factors to be considered, all of which vary from year to year, and even from one restaurant to another (even from one branch to another). In general, gauge by doing audits from previous budget and spending. Compare this with your total earnings so that you can list down projections, investments, and what you will have to do. You’ll then arrive at a number to work with: a considerable budget.
3. ROI Computation
Again, similar to how your marketing budget is affected by several factors, your marketing ROI is also considerably relative. It is dependent on how your business regards ROI, as well as what you decide to spend on. For example, if you have a restaurant promo that runs during a specific period, you can compute for the gross profit by counting total sales minus the costs of the goods that were sold. Afterwards, subtract all your promotional marketing expenses such as printed materials, ad placements, etc.
Another way to compute for the ROI percentage is to have the gross of your profits and divide by how much all the marketing expenses amounted to. Just to reiterate, there are several different approaches, so you’ll need to find out what works best with whatever you need to be computed.
Once you have these requirements, you can then prepare any enhancements or amendments to your marketing strategies.
Improve Your ROI
From what we’ve previously emphasized before, tracking your marketing campaign performance metrics is an essential practice of ensuring that your marketing ROI stays on target.
1. Invest in Technology.
Whether you want to purchase new equipment for your kitchen staff to improve their efficiency (Back-of-House), or Front-of-House automation which caters to your consumers to improve their dining experience, both options will affect your ROI. And both can also help you in reducing headcount or reassigning staff, which benefits your marketing ROI.
As we’ve already discussed, marketing analytics tools will prove to be an advantageous means of upgrading your marketing processes. You may also want to purchase kiosks, gadgets, and software solutions that can speed-up your customers’ steps in reserving seats, ordering, payment, and in giving you ratings and feedback.
We’ve previously discussed the benefits of marketing analytics software. Read it here.
Another decisive tool is your restaurant’s website. Your customers use their smartphones, as well as tablets, to check restaurant locations, open hours, menus, delivery, and reviews, according to the National Restaurant Association’s 2019 report. Hudson Riehle, their senior vice president for research and knowledge, also says that “It is absolutely imperative that you have a digital presence, that your restaurant’s information is complete and accurate in real time, and that it’s mobile-device-responsive.”
This means that it’s imperative that your restaurant must have a working, updated website to establish your online presence. It should also be responsive, mobile-friendly, and must always be updated and accessible. Neglecting your website can turn-off customers who search for your restaurant, and can even leave negative reviews about it, especially on Yelp.
2. Track and Monitor.
If you are focused on boosting your ROI, then you will have to keep a close watch on your marketing campaigns’ performance. Track the numbers on your marketing efforts to provide awareness and if you should need to make any drastic changes should you want to take advantage of a popular product to raise your revenue, or if you want to react to any dipping numbers.
3. Know Your Numbers.
Identify what numbers you’re tracking and take note if they are significant to your ROI. There are some “vanity metrics” that do not necessarily affect any of your target goals. So even if you’re getting enough shares, likes, and comments about your latest offering on social media, check if they’re raising numbers in terms of new customers, profit, and engagement. If not, understand and recognize what they mean, then do adjustments based on your focus or shift priorities.
4. Immerse Yourself.
Experienced restaurateurs know how important it is to maintain healthy interaction with their customers. Even if it’s to converse verbally in-person, answering phone queries, or chatting with a customer online, create an atmosphere of approachable service. You can also get a feel of how your restaurant is faring among your patrons and new customers by being actively immersed. Use their feedback as your barometer and understand what they want or don’t want.
If you want to train your staff to emulate your mindset.
5. Evaluate and Fine-Tune.
Make it a strict habit to audit and evaluate your marketing efforts. Make adjustments where and when you deem necessary. Your ROI is directly dependent on any changes you decide to keep or discard. Avoid shotgun attempts and bandwagon tactics just to attract new clients. Refer to solid data to guide your decisions instead.
While it may overwhelm you at first, it is crucial to be able to master what can push your ROI up or what can drag it down. If your goal is to have a rigid adherence to high standards of your desired ROI, then learn what all these numbers mean. This not only keeps your business ahead of your competitors, but this also means that have a deeper understanding of your customers, as well.