PES 2010: Community marketing gets hot

June 23, 2010
It is an oft-cited stat that a majority of restaurant business comes from a fraction of its traffic – the frequent regulars. That makes new customer acquisition five times more expensive than getting loyalists to repeat business.
But rather than flood the airwaves, television channels and papers with ads to reach those elusive customers, many large pizza chains are finding ways to make connecting with stores' local causes and contingencies more profitable. Consider: Community-based marketing has worked for ever-expanding companies such as Pizza Patron, which has a culture that insists  franchisees be involved in community projects and outreach. That's no small feat to organize at the corporate level for a store that projects 750 units over the next decade. But the payoff hasn't just been directly monetary. School and other local-community involvement has helped position the company as a premier Latino lifestyle brand.
At the recent Pizza Executive Summit in Chicago, several industry leaders helped pave the way for brands to achieve similar goals in a session called "Integrated Marketing: Targeting your customers with a 360-degree approach." The panel included Rosati's Pizza president and creative director Marla Topliff, renowned customer experience consultant Mike Wittenstein and LSA Partners president Deborah Zmorenski. Their presentation on local marketing included three prime community marketing targets – kids, charities, and database/e-mail lists – and offered a game plan for bringing each closer to a company:
Pizza's popularity as a family-friendly food is owed, in no small part, to kids' love of it. "Get the kids, keep the parents," the presenters said. Topliff proposed child-oriented activities such as children's tours and junior cooking classes to acquire new parent customers. She suggested contacting local organizations including the Boys or Girls Scouts to find interested parties. When children attend, send them home with "take home packs" including menus and incentives.
While much local-based marketing can be thought of as "community" in the larger sense, it is often associated with charities and charitable acts. This type of local marketing is easily executed by aligning a particular restaurant business with a local cause and offering the latter a night where 10 percent of store proceeds can go back to them, with the redemption of a flyer. Involved charity members are responsible for canvassing their audience and community for participation. (Ten percent of those sales ends up being less than many companies will pay for new customer acquisition – according to online customer acquisition tool, an average business might pay around $40 to reach new customers.)
Database/e-mail lists
E-mail databases are a great loyalty program tool that can cost less than printing or POS-integrated solutions. They helps restaurants stay in front of customer when they're off-premise – but content must be constructed wisely. In the age of $10 any-way-you-want-it pizza, deals aren't going away. But most chains can't sustain that price point for very long. To this end, the team devised incentives types for each customer type to mitigate discounting:
  1. Frequent customers simply need to be rewarded and incentives. Loyalty programs, even thank-you notes go a long way here.
  2. Routine customers usually come in at the same daypart, for the same thing. Devise an offer that gets these customers in at different times, or a bundle that makes them try something new for a perceived better value.
  3. Lazy customers may need coupons periodically to drive their visits.
E-mail marketing helps boost your overall marketing ROI. Presenters quoted the Direct Marketing Association's finding that e-mail marketing returned $43.62 for every $1 spent on it in 2009.
Wittenstein, Topliff and Zmorenski also tackled other community-oriented marketing topics that involved door hangers, Facebook fan pages, and even involving customers in new item creation.
To access the entire presentation, visit our white papers section.  

Topics: Business Strategy and Profitability , Marketing

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