Tag Archives: Foodie

September 7, 2018 · 12:55 pm

The Great Customer Gulf

Foodie Friday is here at last and with it comes some great information from Earnest Research. My data tells me that screeds about research don’t score particularly well with many of you but I think what the study I’m highlighting today is an excellent reminder of a basic business fact that pertains to the balance between keeping customers happy and attracting new customers. Read on!

What the study examined was the top 10% of various restaurants’ customers by the frequency of visit and how that compares with the average frequency. As reported by The Franchise Times, the gap can be enormous:

At McDonald’s, that top 10 percent customer went 86.5 times each year on average. That’s 309 percent more than the average customer, who went 21.1 times through the year.  Even the most frequent Starbucks customers don’t reach that. The top 10 percent of customers by frequency went 80.7 times—though they visited 374.5 percent more than the average customer who stopped in 17 times.

Earnest researchers checked in on a handful of brands for this data (see chart, right). In green are national QSR chains, orange is national fast-casual restaurants and blue represents chains that are regional but have a traditionally strong customer base. While the numbers jump around a lot, the highest frequency customers come between three and five times more than an average customer.

Your reaction to that may be a large “duh” since the Pareto Principle is probably burned into your head by now. What impressed me, however, was the size of the gap. If you factor in “average order value”, the amount of money spent by the top 10% is huge even though as it turns out they tend to spend a bit less per trip. In real terms, for example, the difference between a top customer at McDonald’s and an average one means a $708 annual value compared to the average customer’s $187.

Money spent to keep a customer happy is money well-spent. Money spent to get a customer to become a more frequent customer is even better. While there’s no question that we all have to keep adding new customers to our base, once they’re there, we need to shower them with love, great service, and incentives to grow their engagement with you. The data shows it’s true in the franchised restaurant business and I’m pretty sure it’s true of yours too.

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August 31, 2018 · 11:35 am

Red Delicious

This Foodie Friday, let’s consider the Red Delicious apple. Until very recently, it has been the dominant apple in orchards all around this great nation of ours. According to the US Apple Association (as quoted in the NY Times), it has recently lost its dominant position to the Gala, and Granny Smiths are closing fast. You can probably hear Honeycrisps off in the distance too.

I know what you’re wondering: is this some sort of tangent brought on the by the start of football season (Go Blue!) and, therefore, the fall apple season? Not really, because there is a business lesson in the fall of the Red Delicious that can be used by any of us.

Have you ever eaten a Red Delicious apple? If you’re not sure, buy one the next time you’re at the market. They will be easy to spot. They’re very pretty – your prototypical apple. It’s a lovely deep red and their skins are generally unmarked. If you were trying to find an apple to use in an art class, the Red Delicious would top your list. So what’s the problem?

Bite into one. What do you get? Not much. They are bland and almost flavorless. That skin is so beautiful because it’s too thick to bruise. Oh sure – you get a blast of sweetness but there really isn’t much of a flavor there, especially when you compare it to pretty much any other apple. While people do eat with their eyes, at some point what they’re eating gets to their mouth and the food needs to deliver on the promise made by how it looks. That’s true of any product or service. Nice packaging, wonderful design, or a fancy sales brochure may attract a large consumer base but if what’s delivered doesn’t fulfill the promise made, it will be one and done. Either you’re solving the customer’s problem and providing superior value or you’re not, and it doesn’t matter how pretty you are.

Don’t be the Red Delicious of your business sector. It may be nice to be number one (and it’s probably pretty profitable for a while), but over time, it’s unsustainable if all you are is pretty. Substance matters, don’t you think?

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August 24, 2018 · 9:12 am

Crying To The Kitchen

This Foodie Friday, I want to write about something that’s been on my mind for the last month. It was about a month ago that I made my initial – but definitely not my last – visit to Skylight Inn. If you’re not familiar with the place, it’s the premiere BBQ joint in North Carolina and certainly one of the best in the country. It specializes in whole hog, eastern North Carolina BBQ, which is chopped meat combined with a vinegar and pepper sauce. It’s simple food but incredibly difficult to do well, and very few anywhere do it as well as this place.

Why has it been on my mind for a month? Because I had an experience which has only happened once before in my life. The food was so unbelievably good that it brought me to tears. I’m not kidding. The last time this happened was in Venice and my poor daughter had to endure me running into the kitchen to hug the chef while weeping praise in my bad Italian. While I didn’t run to the pit this time, I did run back for another plate.

The question I’ve been asking myself since my Skylight visit, besides when I can find the time to go back, is what other consumer experiences have brought about a similar reaction. I couldn’t think of any, which is unfortunate. While I realize that there is something multi-sensory about food (we see it, we smell it, we touch it, we taste it), I think it’s an interesting question for any business to ponder. How can what we offer prompt an overwhelmingly good feeling in our customers? How do we get them to be thinking about their interaction with us a month or more after it takes place? How do we instill that goal into every person and every touchpoint that engages with a customer or potential customer?

We may never send our consumers running to the kitchen weeping with joy but it’s not a bad goal to have, is it?

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