Restaurants Find Recipes For the Recession

When people look for ways to trim their expenses in tough economic times, they turn first to discretionary spending, and at the top of the list for many people is money spent eating out. Most restaurants have taken a big hit in the current economic slowdown, but many are holding their own and a few are actually prospering. For example, in the fourth quarter of 2008, McDonald’s reported that its sales increased 5 percent in the U.S. and 7.2 percent globally. Why are some restaurants doing well while most are struggling? One of the answers is effective market research.

Focusing on value

It should be no surprise that customers are paying more attention to value in these challenging times. When people spend less on non-essentials, they want to be sure the money they do spend buys something worthwhile. But what does value mean to restaurant patrons? Is it primarily the quality of the food or the quality of the service or is it something else that might be a little harder to define? Restaurant research provides some interesting answers to these questions.

At its most basic level, value means meeting expectations. People have definite expectations for different types of restaurants – fast food, casual dining and fine dining. In these tough times, some restaurant managers might feel tempted to cut back in some areas, especially staff expenses. But if a restaurant fails to live up to customer expectations for service because it has cut staff, it will have a hard time keeping customers.

Creating a satisfying experience

Restaurant surveys that attempt to measure customer perceptions of value often focus on some obvious things. Was the food hot? Was it served promptly? How long did you wait to be served? These are important questions, but they represent only part of what is involved in restaurant satisfaction.

Most people go to a restaurant because they are looking for a certain type of experience. They might be looking for fun or elegance or just the pleasure of enjoying certain sights, smells, and tastes. Even patrons of fast food restaurants are looking for more than food. The kids’ menu at McDonald’s features “Happy Meals,” but adults want to have happy meals too. An effective customer survey attempts to evaluate all the factors that go into creating restaurant satisfaction.

Building customer loyalty

Customer loyalty is important for any type of business at any point in the business cycle, but it is especially important for the restaurant business when times are tough. Restaurant research has shown that customers who have a “highly satisfactory” dining experience are twice as likely to return to a restaurant than customers who say their experience was just “satisfactory.” They are also three times as likely to recommend the restaurant to their friends.

Highly satisfied customers also spend more, especially on items such as appetizers and deserts. This suggests that they may be enjoying their dining experience so much that they want to prolong it. Highly satisfied customers also tend to tip more, which in turn leads to highly satisfied wait staff.

So how can a restaurant determine if it is creating a highly satisfying experience for its customers? Some restaurants hire “mystery diners,” while others use comment cards or questionnaires. Another highly effective alternative is to conduct an online survey of recent diners. Online surveys provide a convenient way to ask about a variety of factors that affect customer satisfaction. Survey results can easily be analyzed to determine which combination of factors is most likely to create highly satisfied customers.

Long-term restaurant trends

In times like these, it is understandable that restaurant managers are focused primarily on short-term results. It is still important, though, to pay attention to long-term restaurant trends. In recent years, restaurant customers have shown a growing interest in two things: greater convenience and healthier menu choices. These trends are likely to continue.