- WHITE PAPERS
Happy days are here again.
I know. It doesn't feel that way to me either. Granted, things don't seem as dire as they did in 2008, -09 and -10. But it doesn't seem to me — or anyone I know, for that matter — that our national economic crisis is a thing of the past.
The National Bureau of Economic Research (NBER) announced that the latest recession officially ended in June 2009 (after an unusually long duration of 18 months), but what's missing this time has been the bounce back that usually follows a recession, and a sense that we're back on the rails, economically.
Yes, I know this has to do with the fact that this was a financial recession, not a manufacturing one. I know that a gazillion economists stand ready to go on cable news to explain how and why things really and truly are looking up ... in the long run.
But I also know a gazillion (or at any rate, a good many) restaurateurs who don't give a rat's aspirin what a lot of bespectacled sages in ivy-covered towers say about future upswings. Their business is languishing now. And they're wondering how in the world they can position their brand for healthy growth in an economy that's slouching along at a thoroughly anemic pace.
Some of our own clients have come to us with this challenge. Depending on their situation, we've helped them craft strategies that boost their brand visibility — and traffic — without taking too big a bite out of the bottom line.
1) Coupons — This is the most obvious draw ... and also the most problematic, which is why you'll find branding firms advocating on both sides of the debate.
Coupons can be a simple, (and, thanks to Internet couponers and e-mail blasts) quick and inexpensive way to bring in bodies. But coupons can also can diminish your brand cachet (if you're so wonderful, why the discount?) and make your customers think your everyday prices are as well padded as a Wonderbra.
Some insist that using coupons is like training Pavlov's dog: establish the behavior and soon you won't need the bait. But I've rarely seen this happen; on the contrary, customers are trained to respond only when they get a "treat." For instance, this week I opened my Sunday paper and tah-dah, a McDonald's coupon booklet falls into my lap. Do I go to McDonald's normally? No. Might a $1 smoothie coupon get me to the drive-thru? Once, maybe. But it isn't going to make me an instant raving fan.
Some franchises find themselves forced into couponing when a competitor takes up the tactic. However, coupon combat can end up in a battle won but a war lost to product commoditization and brand dilution. What's more, there's no easy retreat from couponing. So it's wise to consider every strategic alternative before signing that Value Pak contract.
2) Specials and LTOs — In many instances, these are preferable to couponing. They allow a restaurant to oblige consumers who currently are price sensitive due to an iffy economy ... without making a 'til-death-do-us-part commitment to discounts.
Additionally, specials and LTOs allow a chain to create brand-elevating excitement with a signature item that comes and goes. McDonald's does this with McRib, whose attraction is so powerful it can actually tear a 20-something male away from Call of Duty: Modern Warfare 3.
Put it this way: you can see a groundhog anytime, but you can see Punxsutawney Phil only once a year, a fact that has allowed a tiny Pennsylvania burg to become a branded industry. That's LTO power.
3) Charitable Events — Especially in tough times, people like to see a business stand up to help those in need. A few weeks ago, a sandwich shop in my neighborhood gave a 10-percent discount to anyone who donated a non-perishable food item. I already had a coupon from them for that amount, but I still donated a can of soup and thought more highly of the business for its gesture.
You can work a charitable campaign in a couple different ways: 1) give the customer a percentage discount for a contribution (as with the sandwich shop); or 2) pledge a percentage of your receipts from a defined timeframe to a particular charity. The latter can be particularly helpful if you're trying to drive traffic in a slower daypart.
4) Temptations and Specialties — What is your concept known for? Oddly, Dunkin Donuts is celebrated for its coffee. They've capitalized on it so well that their branded packages now sit on grocery shelves in your town. (So do Starbucks'; interestingly, they don't coupon packaged coffee but Dunkin does — see what I mean about brand cachet?)
Chances are, your business was built on a specialty that people couldn't get enough of. If so, apply creative energy to making that a brand-builder. Can it be hybridized? Snack-sized? Oversized?
If you don't have a signature item (or process — those count, too) consider creating one that's unusual, durable and especially now, affordable. It may help to raise your brand profile without compromising on price point.
These are just a few ways to build a brand in bad(ish) times. One or more (or none) may suit your concept. To know which (or if), you need a comprehensive brand profile and strategy. Otherwise, you may find yourself generating traffic without achieving the branding end game of producing loyalty.
Most importantly, keep in mind a time-honored British adage: "Begin as you mean to go on." In other words, assume that the economy will eventually grow at something faster than a sloth pace. Choose a strategy that offers continuity so that the brand-building you do now will only get that much better when things get booming once more.