This week I’m answering a question from a reader who asks:
Our restaurant is a traditional Italian restaurant. We’ve been in business for 60 years and we use old family recipes prepared and served just as it is in Italy. Our ingredients are fresh, we don’t use processed food, we don’t compromise and we pride ourselves on our authenticity. We’ve been the top Italian restaurant in our market for years, but there are now new restaurants opening up and we’re losing customers to them. It’s frustrating because the other restaurants feature “new Italian” and dishes that aren’t authentic in ingredients or preparation. Our ranking in local magazines and online review sites is declining. How do we educate potential customers about how and why our way of using fresh, all natural ingredients and traditional recipes creates better food with more flavor?
Thanks for your question, Joe and congratulations on celebrating 60 years in business as a successful family-run restaurant. Dealing with changes in consumer tastes is a challenge faced by many restaurants. You’ve got a solid brand, a strong track record, a passion for food and a commitment to authenticity. These are all admirable qualities. It can be frustrating when what’s worked for decades doesn’t anymore. What’s even more frustrating is when the market doesn’t appreciate what we value so strongly in our business.
The reality is that consumer tastes change and when they do, their dining dollars go with them. You’ve described how this can impact a restaurant. You’ve seen your ratings and rankings decline and you’ve probably had a decrease in your bottom line.
Now, you’ve got two paths you can take.
- You can educate the market about why your way is better
I appreciate fresh ingredients and authentic Italian food because I’ve been fortunate enough to travel to Italy and experience the cuisine in the cities and small towns of Tuscany. The entire dining experience is delicious on many levels. I’d probably be a regular at your place if I lived in your town.
However, educating the market can be an uphill battle. If you’ve ever watched several episodes of the American TV Show Shark Tank you’ve seen that the biggest objection the investors have to a deal is when consumer education is a big hurdle for the business. The Sharks can’t provide enough capital or time to teach the marketplace about why or how the product or service being pitched is the best.
This means they can’t be guaranteed that consumers will agree which means that the success of the business can’t be guaranteed. If a panel of five successful multi-millionaire entrepreneur investors can’t or won’t have consumer education as part of a business strategy, it’s probably not a smart business move.
This option is not impossible, but it will take time and money and it’s tough to say if consumers will ultimately agree.
- You can update your concept to meet consumer tastes
A quick Google search on “changing consumer tastes” returns several news items about giants in the food industry that are collectively spending billions of dollars to transform their products to meet new consumer demands. Companies like General Mills, celebrating 150 years in business, has been making processed, sugary breakfast cereal for decades. They’re removing artificial colors and flavors from their products according to a post on their blog. Why? “We’re simply listening to consumers and these ingredients are not what people are looking for in their cereal today,” says Jim Murphy, president of our Cereal division.”
Papa John’s pizza is spending $100 million dollars to clean up its menu, as are brands like Chipolte, McDonald’s and Taco Bell and Panera after. The investment is seen as a way to meet customer demands and ensure future business.
Ironically, these companies are shifting to natural ingredients and you already use natural ingredients. However, the example is to show that even big brands shift to meet consumer tastes and demands.
In your case, “fresh, natural ingredients” and “authentic recipes and preparation” don’t seem to be what consumers are looking for. The hard truth is that customers will only pay for what they value, not what you value.
If you’re going to choose option 2 and shift your offering to meet customer needs, here are 3 things you can do.
- Create a list of non-negotiables. If you’re a regular reader, you’ve heard us repeatedly say that strong brands stand for something and they’re OK with the fact that they’ll have customers that love them and other people who’ll never buy from them. So, look at everything in your restaurant and decide what you absolutely will not change and what you can adjust in your concept or business.
- Do some research – take a look at all the reviews in newspapers, magazines, blogs, review sites and social media to see what customers like and don’t like about your restaurant. Do the same thing for your competitor’s restaurants. Dine there and look for themes and patterns around consumer tastes.
- Apply the research – take the list of things that you’re willing to change and find ways to incorporate what consumers want into your restaurant. For example, if consumers love being able to eat lunch in 30 minutes, but you will not change your fresh ingredients and authentic recipes find a way to do both. Maybe you can find dishes that you can prepare with fresh ingredients in an authentic way in 15 minutes to have customers in and out in 30 minutes. Make this a special section on the menu.
You can still use your brand stories around the family business and the recipes and way of doing things that have been handed down from generation to generation. You can stay true to what you’re passionate about and what you value in good food. You can do all these things while meeting new customer tastes and trends.
It will take some trial and error to incorporate these changes into your restaurant so be patient and learn from each idea you try. You can also use these new service items or menu tweaks to earn some PR or have restaurant reviewers give you another look. We’ve got a how-to article on that here. How to earn the publicity you deserve.
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