Are Your Restaurant Marketing Programs an Expense or Revenue Generator?

How do restaurant operators look at the cost of marketing?

The NRA’s guidelines for restaurant marketing says that restaurants should allocate anywhere between two and four percent on restaurant marketing.  Do restaurant owners follow this model when budgeting for their business?  Like many families, the budget sometimes goes out the window when juggling expenses.  The day to day bills, gaps in the income stream and just being overwhelmed plague many independent restaurants. Confusion is understandable, especially in the beginning of the year when many of these issues are impacted by weather.  In fact, a recent article stated that Bob Evan’s restaurants reported that the impact of the winter weather cost them $5 million dollars in revenue just in the month of January.

For many restaurants, traffic counts and revenue are down. They try and compensate by reducing expenses every way they can. But how should a restaurant look at marketing? Is it an expense or revenue generator? The basic fact is that yes, marketing does cost money. Many independents have stated that they feel “nickeled & dimed” by all of the various marketing expenses.  This combined with allocating the time and resources to implement all of the various marketing programs quickly falls to the back burner on the to do list. One of the top five complaints of restaurant owners is that they just don’t have the time to do it all!

The other side of the coin is that the various marketing programs do generate income.  Take a look at just some of the marketing programs that drive revenue:

• Menu Marketing Programs
• Email Marketing
• Loyalty Programs
• Social Media Management
• Brand Reputation Management
• Local Search Visibility

It’s easy to see how a restaurant owner would be overwhelmed with these various programs. Each program takes specific skills to implement and manage.  In some cases, the results do not often happen immediately.

What should a restaurant owner do?

First question is to understand what your current marketing programs are and the results they are delivering.  Are they working for your restaurant?  Are they being implemented correctly? Is there a return on the investment of time, resources and money?  Once a thorough review is done, the next steps would be to develop a plan of what your marketing strategy should look like and develop a budget.  The final step and probably most important step is to consider how each of these programs will be implemented. Once these steps have been evaluated, it’s time to develop a plan of action.

Is restaurant marketing worth it?

A recent analysis done for a restaurant in Pennsylvania indicated a revenue potential of over $250,000 by implementing various marketing programs. A review was done of his current programs and found that many were ineffective and not delivering results. A plan of action was developed by his marketing consultant and the process was implemented by the consultant. This approach allowed for the operator the get the best programs implemented by a professional. The cost of executing this program wound up being less than one percent of sales.

Where should you start?

The best way to start is to get a customized revenue analysis for your restaurant.  This combined with a review of your restaurants internet footprint will give you an indication of the potential revenue gains for your business. This free service can be completed by contacting CORE Restaurant Marketing at 1-888-890-9492 x 101 or by sending an email to info@corerestaurantmarketing.com.