Market Watch - Bars & Restaurants
Sales Tips For An Expanding Sector
Raise a glass to this: Americans love to eat and drink at bars and restaurants. So much so that the National Restaurant Association says the sector’s sales likely increased 3.6% to $683.4 billion in 2014, which is equal to 4% of the U.S. gross domestic product. Americans also rank the restaurant industry as the top business sector in the country, according to a recent Gallup Work and Education poll.
“The restaurant and bar sector orders a lot of promotional products, as they strive to create and build a unique brand relationship and connect with their clientele,” says Mitch Weintraub, CEO of Pinnacle Promotions (asi/295986). “Promotional products are a way to help develop and expand a brand to reach out to their target demographics and foster repeat business.”
How can you tap into this wave of market momentum? Keep reading to find out.
Enhance the Experience
A general rule of thumb is that restaurants should allocate 3%-6% of sales to marketing, according to a report from restaurant industry consultant Aaron Allen. And, while some restaurant owners think it’s best to spend money to drive sales when business is slow, Allen advocates spending marketing dollars to build on busy periods.
“Fish where the fish are biting,” he says. “If July is your busiest month, you should spend a proportionate amount on your restaurant’s marketing budget in that month.”
Distributors should remember that the restaurant sector is always looking for ways to carve out its own unique advertising angle, making promotional products an inviting tool. “Brand visibility and creation of awareness is critical in a market where there is competition on every corner,” says Bill Mahre, president of ADG Promotional Products (asi/97270).
Bars typically use ad specialties to enhance the experience itself, says Beth Beasley, director of sales and senior branding manager at US Imprints (asi/348081). Some examples include branded glow sticks and LED wristbands for the dance floor, or leis, custom Hawaiian shirts and sunglasses for a Luau Night. How about cowboy hats, cowboy-shirt beverage coolers and cowboy boot mugs for Western-themed bars?
Restaurants also use promotional products to help with branding, attracting new customers and winning repeat business, reinforcing brand affinity. Seeing the restaurant’s logo and tagline over and over again on cups, napkins and straw caddies helps give the brand a more permanent place in customers’ minds, Beasley notes.
Restaurant giveaways can help extend brand awareness and marketing into the customers’ own homes as well. A Mexican restaurant may hand out taco-shaped stress relievers at a Cinco de Mayo festival that customers can use to redeem a 15% off special, she suggests.
The majority of promotional product purchasing for bars and restaurants is done at the local level, according to Beasley. Her clients – who prefer face-to-face meetings – feel good about supporting local commerce.
“This market thrives on local relationships with reciprocity,” says Sheila Johnshoy, ePromos’ (asi/188515) vice president of marketing. “Bars and restaurants want to support the businesses that patronize their establishment, as well as create goodwill in the community.”
Often, bars and restaurants are tapped to support local events, like fundraisers and festivals, so there is a natural tie-in with local promotional product distributors. “Restaurants and bars rely heavily on local distributors to supply them with everything from custom uniforms to branded matchbooks to promotional glassware,” says Pinnacle’s Weintraub.
Corporate chains or franchise establishments traditionally use a company store structure through larger, national distributors and suppliers, he adds. Still, some chain or franchisee individual locations may be allowed to break from the company store model and go outside to work with local distributors because of pricing, quality, options or a relationship with the representative or location.
Ignore the Signs
Carla Bollinger, advertising specialist at Top 40 firm Halo Branded Solutions (asi/356000), does a significant amount of sales within the food and beverage industry. She got her start working with the restaurant industry when she ignored the “No Solicitation” sign on the door of a Pizza Hut regional office. Although it was a national chain, the local approach won out.
“I walked in bearing goodies and told them I could do anything with a logo on it,” says Bollinger. When asked if she could produce an award in a day, “Of course I said yes. I felt this could be a big opportunity so I scrambled and got it done,” she says.
Following that first order, Bollinger has done lots of awards and lapel pins for the chain. She even began providing uniforms, despite the fact that Pizza Hut said they had to come from corporate headquarters. “I asked about the manager’s shirts, which were shipped from Texas,” Bollinger says. “I had my embroiderer do a new logo, and ended up providing lots of apparel in the Western states for Pizza Hut.”
That was 15 years ago, and she continues to provide promotional items for Pizza Hut franchises. She has worked with the chain through its conversion to a franchise business, by being proactive and staying on top of organizational changes that affected the corporation’s promotional buying.
Pizza Hut is now offering delivery on bikes, so there is a safety aspect to their promotional needs. That’s allowed Bollinger to pitch wearables, flashlights and safety cones, as well as put awareness messages on water bottles and other gifts. “People work very hard in the restaurant industry and good companies like to reward them,” Bollinger says. She has provided awards to deserving employees, as well as Christmas presents for district managers to give to top store managers. These range from pens to jackets.
Get the Party Started
Steven R. Flaughers, owner of Proforma 3rd Degree Marketing (asi/300094), moonlights as the lead singer in a country music band. So it’s fitting that he landed a promotional job at The Thirsty Cowboy after playing a few gigs at the country western bar, providing T-shirts and cami tops for the ladies that read “Cowgirls Get Thirsty Too.”
In another example, US Imprints helped one client, The Billiard Club of Edmonton, Alberta, with a beach-themed Full Moon Party. “To help create a fun atmosphere and offer that unique experience, we printed custom sand pails that the bar incorporated into its special drink of the night,” says Beasley. The pails were such a hit that the Billiard Club has reordered 500 pails each year for the event, in addition to multiple reorders of sunglasses, sombreros, bottle openers, drawstring bags, pens, highlighters and flying discs.
When servicing local restaurants and bars, it helps to attend local events, both business and personal, to get to know the community, says Beasley. As you expand your network, look for chances to ask your contacts for introductions to potential customers. “Once you start building relationships with a few establishments, ask those customers to introduce you to the decision-makers of their locations in other areas,” she says.
When working with bars and restaurants, it’s important to be mindful of their hours and note the best time to talk. “They don’t work traditional 8:00 a.m. to 5:00 p.m. so you need to make yourself available when they are,” says Johnshoy of ePromos.
It’s also key to approach the right person for sales opportunities. Normally with chains or franchise operations, a distributor should target the regional VP or marketing director, and with independent establishments, the owner or manager, says ADG’s Mahre.
He believes regional people can have a big impact. “They usually have budgets for their respective areas of responsibility, and great events can become national ones quickly,” he says. “A small opportunity now may become very large quickly if it is a hit.”
At corporate or franchise locations, Weintraub thinks reps should reach out to the store manager to inquire if they do any local ordering, or if all promotional materials are ordered through headquarters. “A rep can go a step further to ask the store manager for a contact person at the corporate level to discuss their plan for promotional products and uniforms,” he says.
Finally, when pitching a bar or restaurant, Flaughers suggests focusing on apparel. “I look and see if all the staff is wearing the brand,” he says. “They may want a T-shirt, aprons, polos, or if it’s a sports bar, perhaps a referee-style outfit. If you target an actively growing brand, you can grow with them with apparel, and then have an opportunity to provide other items as they expand.”