by Howland Blackiston/ principal, King-Casey
As groceries and supermarkets step into the brave, new world of branded, proprietary food offerings, they quickly learn that they have a whole new set of competitors—specifically, QSRs and fast-casual restaurants. But that’s not all bad news. QSRs have served their market for 50-plus years, which means that grocers can shortcut their learning curve by adopting some QSR best practices. Here are a few of them.
Develop a menu strategy
This is the foundation of your foodservice business. It links a thoroughly-researched menu strategy to specific business objectives. The strategy prioritizes the menu products and guides all in-store food merchandising. It also helps identify what new menu items should be developed and existing items that should be eliminated. Developing a menu strategy is similar to strategic business planning. You set business goals relative to menu items, prioritize these goals, and then develop/execute a plan with specific action items. Answer the questions below to see if you have a menu strategy.
Do you have a menu strategy?
Unless you score 100 percent on this test, you don’t.
1. Has each menu item been prioritized based on its importance to the brand?
2. Do you have a specific action plan for each menu item?
3. Do you have the supportive details in place to execute the plan?
4. Do you have specific metrics to evaluate results?
5. Has the menu strategy been shared and understood throughout the company?
Optimize your menu boards
Research shows that 56 percent of customers can be influenced by the menu board. The CEO of a QSR recently told me that “menu board optimization is one of the best investments we can make, far exceeding any other strategy to increase profits.” The problem is that many companies don’t link menu board performance to business objectives; plus, they don’t take into consideration how customers use the boards. Once you set your objectives, leverage your “hot spots”—the areas where customers tend to look first and most frequently. This is where your best-selling, highest margin menu items should be placed. Conduct a “sales-to-space” analysis to see if the ideal amount of menu board real estate is devoted to your best-selling items. See if those items also enjoy the most prominent placement on the menu board. There’s more to do, but this will get you started.
Commit to innovation…continuously
The best QSRs never stop exploring new ways to do things better. Today, most are simultaneously exploring kiosk ordering, mobile app & pay, and home and curbside delivery, in addition to upgrading their drive-thrus. If you want to compete, you should, too. But technology is not the only source of innovation; consider your menus. QSR test kitchens churn out myriad new product ideas daily in search of the next signature dish that will be a blockbuster.
Think customer zones
Actually, groceries should have a leg up in this area because they already treat their meat departments differently than the produce aisles and the pharmacy. But there is even more to what we call Customer Operating Zone Improvement (COZI). There are many other zones where your communications can impact the buying decision—outside the store, the entry way, signage pointing the way to the foodservice section, menu boards within the foodservice section. Starbucks recognized this when sales soared after applying COZI strategies to its drive-thru zones. Based on this success, Starbucks made the largest capital investment in its history to replicate the COZI approach at its drive-thrus nationwide.
Howland Blackiston is a principal of King-Casey, a consulting and branding firm serving the restaurant industry.