Thu. Sep 29th, 2022

When restaurateurs like you subscribe to my monthly newsletter (and to get the freebies that I offer), in the subscription form I ask the following question:

What’s your biggest challenge as a restaurant owner/manager? And this is the number one answer from a significant number of restaurateurs every month:

“To bring new customers to my restaurant.”

It looks like a logical answer, doesn’t? Who doesn’t want to have lots of new people walking through your door? However, if I continued to manage my restaurant – and after everything that I know now about marketing – my wish/challenge would be different. It would be something like:

I want my existing clients to come back to my restaurant over and over.

Does that mean I don’t want new customers? Of course I do, new customers are new opportunities to convert into repeated clients, but targeting your marketing efforts towards getting new clients shouldn’t make up the bulk of your expenses or efforts. So what do you need to do?

I will explain to you by presenting a hypothetical exercise:

Let’s imagine that we have two restaurants with similar capacity. We will call them Restaurant A and Restaurant B.

For the sake of simplicity we assume the following parameters are common to both restaurants:

o    The average price per meal is $25 sushi baden baden

o    The profit margin per meal is $10

o    The marketing investment for both is $5,000

Now the differences are:

Restaurant A invests all the $5,000 in bringing in new customers. They invest the money in a very successful campaign and produce coupons, direct mailing, etc. When the $5,000 marketing dollars are over, they brought to their restaurant 1,000 new customers. Pretty good, eh? Five dollars per customers is an extremely small investment towards brining in new clients.

Restaurant B does things differently. They spend the same amount of money ($5,000) but instead of expending the entire amount focusing on bringing new clients via advertising, they decide to invest all the money in their existing clients to bring them back over and over. They will also give them incentives for their friends and family members so that they can also come in and try their restaurant.


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