The U.S. restaurant industry is massive, and it continues to grow at a record pace. Annual industry direct sales are expected to reach $511 billion this year, originating from more than 925,000 restaurant locations, according to the National Restaurant Association. For every dollar a consumer spends on food, 48 cents are spent in restaurants.
So how can marketers cash in on this tremendous opportunity? "As always, access to restaurant owners is the biggest challenge for marketers," said Mark Vaughan, editor and publisher of Sante, a magazine geared to upscale restaurant executives. "Getting their attention can be extremely difficult."
Patricia Dailey, editor in chief of Restaurants & Institutions magazine, said not only are restaurant execs busy, they are inundated with sales pitches. "Everyone is looking for the phrase that pays-a strong, relevant message that jumps out from the lower-level clutter," Dailey said. "Restaurant executives are saturated from all directions and from multiple sources."
Dailey said messages have to connect with the intended audience, forming a bond almost instantly. "Marketing to restaurants today demands much greater sophistication, with tailored messages and deliveries for different demographics," she said.
One place restaurant owners have historically gone to find necessary products and services has been restaurant and foodservice trade shows. "For the last 10-plus years, the No. 1 objective of restaurateurs in attending shows has been to find new products and vendors," said Ron Mathews, event director for Reed Exhibitions' Restaurant & Foodservice Events group.
At a show, executives can see and even try out new products firsthand, as well as compare prices, learn about trends and network with fellow restaurateurs, Mathews said. "Marketing personalization works best face-to-face," he said. "It's something a phone call or computer screen simply cannot even come close to conveying."
No matter the marketing vehicle, suppliers won't get far if they don't have the right message, Vaughn said. "By far, the most successful marketing programs right now are those that focus on dollar-and-cents solutions to restaurant business challenges," he said. "The ones that really don't work are those that ignore the b-to-b aspects of the market and instead simply retool a consumer campaign."
Further complicating matters is that restaurants, especially those on the high end of the market, like to make changes often. "Many restaurateurs like diversity and experimentation," Vaughn said. "But while this creates constant competitive opportunity, it makes developing brand loyalty difficult for existing suppliers. To win loyalty you have to sell them on your product availability, quality and customer service-in addition to the product itself."
Capitalizing on Trends
Restaurants have always paid close attention to trends in food and decor, in hopes of capitalizing on consumer demand. The same is true for their suppliers. Here are some of the latest restaurant industry trends marketers should know about:
Healthier, more nutritious foods. Some 72% of adult consumers said they are trying to eat more healthfully in restaurants, according to the National Restaurant Association's "2006 Restaurant Industry Forecast." Both fast-food and table-service restaurants have begun serving more entree salads and bottled water, as well as wraps and pitas stuffed with nutritive ingredients.
Ethnic/distinctive foods. "Consumers are being more adventurous with their food choices, creating opportunities for specialized and ethnic menu items," said Daniel Richards, editor of the National Restaurant Association SmartBrief newsletter. "As a result, I think we'll see more overseas companies marketing to both restaurants and consumers in the coming year."
This trend also means opportunities for organic and local produce providers. "Vegetarian gourmet is also a growth area," said restaurant trend watcher Nan Andrews Amish. "Upscale groceries will offer significant takeout competition."
Increased attention to energy efficiency. Higher energy prices will force belt-tightening among some restaurant operators as well as consumers, Richards said. A majority of operators surveyed in the "2006 Restaurant Industry Forecast" anticipates higher energy expenses that will eat more of their bottom line next year.
Demand for convenience. Thirty-four percent of adults say purchasing takeout food is essential to the way they live, according to the "2006 Restaurant Industry Forecast." Consumers have already begun to embrace new convenience services at full-service restaurants such as curbside, drive-through, delivery and takeout. Industry insiders agree that more of these restaurants will actively attack the delivery and takeout markets in 2006. "From the b-to-b perspective, that means opportunities in sturdy, heat and cold containing containers that are not prone to spillage, more carryout bags of various types and more zip lock, and foil packets," said Amish. "There will be opportunities for environmentally friendly as well as more spill resistant containers. M