Archive for 2011

A-V: the Underappreciated Profit Center, Part II

Are you losing huge profit opportunities in meetings audio-visual and technology sales? Last week we looked at two of these four questions:

1. How is your audio-visual offering described on your web site?

2. Do you have a marketing plan for selling audio-visual equipment?

This week we’ll look at 3 & 4, and I’ll point you toward some best practices.

3. How do these offerings set you apart from your competitors?

4. How important is audio-visual to your F&B profit picture?

THREE.  About your offerings being competitive: I probably wouldn’t have to ask this question if we were talking about bar, restaurant, catering or room service menus.

Is your product essentially generic? Same things “everyone” has? Your third party vendor probably has access to a lot of equipment, especially high-tech, that you don’t list. Why don’t you list it? Because no one orders it? Because you only list what your competitors list? Because you don’t participate in creating the list (please see #2)?

For example, I rarely see “digital white boards” listed. There are many types, the latest allow meeting participants to literally email (or save to a thumb drive) whatever is on the board at a specific time.  I’ll bet your vendor has access to them. Or, how about audience polling systems. Same thing. Of the last 20 hotels and conference centers I’ve looked at, I’ve seen digital white boards twice, and audience polling systems just once. What’s your profit on a digital white board compared to a flip chart?

And what’s the impression you make on a meeting planner when you list high-tech items, and when you list services such as “web-casting your keynote speaker’s address”?

FOUR. What is audio-visual’s contribution to your departmental profit? For this information I looked at a handful of brands and checked the operators’ P&L’s.  I took the net commission a hotel makes from selling A-V and divided by total departmental F&B profit. The average was 10%. In other words, 10% of all hotel F&B profit comes from audio-visual. This is an average and your numbers may be much lower or much higher. But at some hotels, 10% could be thousands or hundreds of thousands of dollars.

Let’s summarize Parts I & II.

  1. Create a serious presence for audio-visual and other technology products and services on your web site – I recommend a Technology Menu.
  2. Develop a marketing plan for audio-visual and other technology – use your F&B marketing skills as your guide, you’ll do well
  3. Use A-V and other technology to enhance your competitive advantage in the meetings marketplace.
  4. Set a goal for increasing your commission/profit dollars, and work with your A-V company to get there. Next year, work with them to create some win-win packages.

Finally, here are a few Best Practices noted while conducting research for this column.

  • The Hyatt Shanghai, Ritz-Carlton Santiago and Westin Montreal don’t claim to have an audio-visual expert. Rather, they each have a “Technology Concierge”. If you don’t like that title, how about “IT Consultant” or “Director of Technology”?
  • Marriott Banquet menus have a section dedicated to Technology.
  • The Marriott San Diego Gaslamp’s Technology section bundles several of their technology features into Presentation Packages, with everything a presenter could need for a certain type of presentation. Smart.
  • The Holiday Inn Chicago Mart Plaza has an excellent technology menu. So does the Radisson Plaza-Warwick Hotel in Philadelphia. Pictures, graphics, professional layout, packages and a long list of equipment. Attractive layouts,  just like they were selling food and beverage.

Those are my thoughts, let me know yours.

 

Post to Twitter

A-V: the Underappreciated Profit Center, Part I

Are you losing huge profit opportunities in meetings audio-visual and technology sales? Here are four questions for your consideration. We’ll look at two of these this week, and two others next week. 

  1. How is your audio-visual offering described on your web site?
  2. Do you have a marketing plan for selling audio-visual equipment?
  3. How do these offerings set you apart from your competitors?
  4. How important is audio-visual to your F&B profit picture?

I’m thinking that audio-visual equipment rental is something that gets little attention from most F&B Directors, at least until the projector light bulb burns out in the middle of a meeting and the A-V tech can’t be found.

So, let’s drill down a little on these four questions.

ONE. Look at your web site – does A-V get its “fair share”? Most of the hotel web sites I’ve looked at have descriptions that fall into one of three categories:

  1. A generic description of offerings and services, sometimes with a couple of examples. This is akin to having a restaurant’s web presence limited to a statement about how wonderful your food is, you’re sure to enjoy it, etc.
  2. A list of items. Often these lists are outdated – I’ve seen lists with 35mm slide projectors and laser disc players. Thinking about your restaurant again, would you put a simple list on your web site in lieu of a menu? “We have: hamburgers, steaks, salads, chicken, breakfast, soft drinks, desserts, wine, beer & cocktails”.
  3. A link to a third party. Many of the third party A-V (and other technology) companies have a very impressive array of equipment and offerings. Sharing this information with meeting planners is certainly appropriate. But wouldn’t you like share the information in the context of your hotel’s services? When I go to a site and (eventually) find the audio-visual information, if I just see a link, what I really get is the feeling that “hey, we’re busy, go bother the A-V company, but don’t worry we’ll talk again when it’s time to give you the bill”.

Read more

Post to Twitter

Catering Menu Formats – Best Practice?

What’s happening in the world of hotel catering menu formats?

I’ve written about catering menus before. I’ve suggested that a catering menu is really not a menu, it’s a marketing tool. By that I mean that a catering menu’s most important function is to persuade a prospective client to book with the hotel. Describing food and beverage offerings is important, but secondary.Effandbee Grill Ventures Consulting

Not so at a restaurant, where the menu is first about the offerings themselves, and secondly about potential customers (e.g. posting a menu outside the restaurant or online).

Recently I examined online menus for five upscale hotels, each a different brand. I looked at several features.

DOWNLOADABLE PDF OPTION

This was possible 100% of the time, but it was easy only 60% of the time. It seems that the more features a hotel has for their online offerings, the more difficult it is to download a clean version of the menu. It may well be that the decision has been made that downloading a menu is no longer required as other means of sharing electronically are ubiquitous. I don’t know. Another approach would be a separately-configured matching PDF version for the online menu. A B&W optional version for the print-happy would be a nice touch, by the way.Effandbee Grill Ventures Consulting

FOOD & BEVERAGE PHOTOGRAPHS

100% are doing this. And why not. Thanks. To iStock.com and many others, affordable professional-quality food photography is available to all.

INTERACTIVE NAVIGATION

80% of the menus offered this. I can click “Receptions” and I’m taken there instantly. I think this is now an expectation. Especially since it doesn’t require much technical expertise – you can us hyperlink to add the feature to in a Word version of your menu, save it to PDF and it will carry over.

PLATED ENTRÉE FORMATS

60% are listing their plated entrees in bundled formats, an entrée is accompanied by side dishes, sometimes a dessert and appetizer, and there is a price attached to it. I recommend an À la carte format which gives the client more choices and gives you more options for upsell.Effandbee Grill Ventures Consulting

PRICES USING DOLLAR SIGNS AND CENTS

60% of the menus have prices with dollar signs, in spite of evidence that eliminating dollars signs increases sales. 60% of the menus show cents as in $0.00, although there is a school of thought that dropping cents gives a menu a more-upscale impression.

PAGES DEVOTED TO BEVERAGE

Beverage is generally more profitable than food and offers the catering director more opportunity to create excitement in the menu. The opportunity seems to be underutilized. One of the sample hotels uses 20% of its pages for beverage offerings – not bad. The others range from 9% to 15%. Total beverage pages ranged from 3 to 8.

MEANINGFUL FILE NAME

0% Take advantage of this, the easiest way to create a great first impression of your menu – give the file name an interesting marketing-based name that identifies you and sets you apart. I wrote about this in the aforementioned January 2010 post. “Banquet Menu.PDF” is not a good file name (“Banquet Menu 2010.PDF” is worse). Identify your hotel and add a phrase that distinguishes you, the Chef’s name or an adjective or two or a reference to your specialty.

Those are my thoughts, let me know yours.

Post to Twitter

Are Food Trucks a Threat to Hotel Catering Business? Part II

Food Trucks may pose a threat to hotel catering business. Last week in the first part of this blog I suggested that:

  1. Food truck foodservice is not a fad, in fact it is here to stay, so get used to it
  2. Food trucks offer some very real – and in 2011 very relevant – advantages compared to hotel catering

In fact, I went so far as to say that were I doing a SWOT analysis for a hotel catering department in a major market, I would list “Food Truck Catering” as a threat.

Then I foolishly promised suggestions in Part II- how to turn this into a competitive advantage for your hotel.

OK so now what?

Go buy a $100,000 food truck? That would be OK, but not, I think practical. Anyway, don’t ask me to do the ROI on that one.

So, no, don’t buy a truck.

Instead, leverage what you do best, what the food trucks cannot do. Then turn it into a competitive advantage. I’ll explain.

It’s simple really, and everybody wins. Partner with a number of high quality food trucks. The way you already partner with outside caterers for certain special needs required by your customers from time to time (I’m thinking kosher events at hotels without a kosher kitchen and ethnic weddings, for example).

Next, create a new section for your catering menu, “Food Truck Events”. Think about it. How many years have you had “Mexican Station” on your menu? And when was the last time you saw a competitor without a comparable offering? Let’s get the potential customer excited. If you’re not sure what I’m talking about, please see Part I.

What’s a “Food Truck Event”? It could be a tent with 5 food trucks in your parking lot. It could be your “normal” in-house reception, even wedding reception, but now two of your stations are catered by two popular (brides’ choice?) food trucks.

Catering Directors: this is a win-win-win-win (Hotel-Customer-Food Truck Operator-Employee). You add excitement to your offerings, your menu. You get new business that might not have otherwise booked with you. You’ve negotiated a margin with the food truck owner(s) plus (more important!) some exclusivity for your hotel. You don’t want every hotel offering “your” food truck offerings. The food truck owner has a source of new business. More work for your banquet team.

Why will this work? Because of the innate competitive advantages that hotels have over food trucks:

  • You can serve beverage alcohol, they can’t
  • You can provide a large variety of items, they cannot
  • You have a roof, they don’t
  • You have tables and chairs, a dance floor and lighting – they don’t
  • You are a one-stop-shop, they are not – who wants to book every last thing, including tables and chairs separately?
  • If the event is outdoors, you can offer a backup plan for inclement weather – they cannot

Finally, don’t forget one more thing that they have and you can leverage: a following in social media. Maybe this partner thing could really go somewhere?

So, reach out now. Find the best food trucks in your area, trucks that support your hotel’s quality level and image, and form alliances. And don’t forget to update and market that menu.

Those are my thoughts, let me know yours.

Post to Twitter

Are Food Trucks a Threat to Hotel Catering Business? Part I

Food trucks competing with a well-equipped catering department at a midscale or even upscale hotel? Forget it, I’m kidding.

[FYI: the second highest Zagat food quality rating for any restaurant in San Francisco, 28, is a food cart that’s available 2 days a week. I’ve been. Zagat’s right.]

I don’t know a single catering director who has expressed concern about this. I’m not sure it’s on anyone’s radar. Yet. In fact I know some pretty smart hoteliers who have hosted food truck events. I wrote about it last year.

[Oops. I just Googled “Weddings & Food Trucks” got 23 million hits.]

[Oops again. The Knot just published its 11 top weddings trends for 2011, and guess what?]

We all know that, really, food trucks are a fad, and anyway health departments will be shutting them all down soon and we can get back to the way things were. For example the city council of Richmond CA just put the kibosh on new licenses for 45 days while they figure out which regulations should apply, and how. Closer to home, Atlanta has very strict enforcement policies.

[On the other hand cities such as L.A. – 10,000 food trucks – and Santa Monica and Chicago are passing strict but reasonable laws to govern the trucks. In fact, food truck owners welcome this, they understand that ultimately it will bring them more and new customers who are now reassured about the safety aspect. The New York Times said this “may be the ultimate sign that this faddiest of food fads is going mainstream”.]

Why is this happening, and why is it a trend – not a fad? Some will cite technology and others the recession and they would not be wrong, but there is more. There is a permanent shift in what we value, and this shift began before the recession. The best explanation I’ve seen for this is found in Spend Shift by John Gerzema & Michael. The subtitle says it all: “How the Post-Crisis Values Revolution Is Changing the Way We Buy, Sell, and Live”. Call it “new normal” or whatever you wish: consumers are rejecting “overconsumption”. The authors of Spend Shift cited 5 emerging values – emerging prior to the recession by the way. Among them are these two:

  • We are “adopting a more nimble, adaptable and thrifty approach to life”
  • Old status symbols appeal less, and “purpose, character, authenticity and creativity” are pathways to the “new good life”

Let’s apply this to food truck catering. What do they have that a top notch hotel doesn’t? Affordability. Variety in venue (pick a venue, any venue the trucks can access). Specialization – oftenFood Trucks are great at just one thing, that’s all they do. And Authenticity. For examples check out the Top 20 Food Trucks in the USA. Fun, Buzz, Creativity – and it’s all wrapped in social media marketing.

And now it’s time to get back to hotel catering. Is this really a “threat” to your business? If you asked me to do a SWOT analysis for your business, and if you are located in a major market, I would have to answer “yes”.

OK so now what?

I’ll suggest a response in Part II next week.

Those are my thoughts, let me know yours.

Post to Twitter

Is Your Breakfast Menu Up-To-Date?

F&B Directors: how much has your breakfast menu changed in the last two years? How about your dinner menu? I often find that hotels focus more on updating the dinner menu while breakfast stays the same. Except for pricing. But these same hotels serve five to ten times as many guests at breakfast as they do at dinner.  

Next question: what is your breakfast capture rate compared to one or two years ago? Well, it may be “red alert” time. Your competitors had an interesting view of the recession, apparently thinking it was the right time to grow the breakfast segment. While casual dining remained stable, with 17% serving breakfast, and midscale or family dining remained steady at 77%, QSR including coffee shops grew to 48%. “In total 47% of all commercial foodservice units currently menu at least some breakfast items.” All of this data is courtesy the 2011 edition of QSR ONESource Magazine (www.qsrmagazine.com). For their publication on January 14 they used data from a number of sources. Here are some highlights. For much of their breakfast menu insight QSR used data from Datassential menutrends™ Direct (http://tinyurl.com/4zodz92).

  • There is significant growth in menuing  nontraditional proteins, including chorizo, sirloin, crab and salmon.
  • Parmesan and goat cheese are the fastest growing cheeses across all types of operators at breakfast.
  • Upscale dinner preparations/descriptions are showing up at breakfast, including wood-smoked, oven-roasted and fire-roasted.
  • Ethnic items continue to increase in popularity on menus – while Mexican shows up the most, there is growth in Italian and Greek inspired items.
  • I know you’ve heard about “health” as a growing trend for years; this latest information says that your guests are more likely to desire healthy food at breakfast than at any other time, and that even incorporating “healthy attributes” will have an impact. Think whole and multi-grains, super fruits and lean meats they say.

Looks like it’s time for breakfast.

Those are my thoughts, let me know yours.

 

Post to Twitter

Is Your Menu Missing Something?

Your dinner menu lists appetizers, right? Or maybe “Starters” or “Small Plates” or a clever synonym suggesting that this is where you start your meal.

But really, it isn’t the start, is it? I mean the start is usually a beverage. Perhaps you offer a beverage menu or a table tent that promotes beverages. OK.

"I wonder where the cocktails are..."

But experts suggest that you (also) list drinks, including wines, on the food menu.

January 26 was interesting for me. That morning I was asked by a client to review a dinner menu for a top notch hotel in the upscale segment.

The dinner menu I reviewed had no cocktails, beers or wines listed anywhere. This isn’t unusual for hotel dinner menus. The menu did have coffee, milk and juice. I recommended enhancements which would put select beverages at the top left of the menu, at the beginning. Why not let the menu “begin at the beginning”?

That same afternoon I attended 2011 Cheers Conference (www.Cheersconference.com) in New Orleans, and an excellent presentation (one of many at the Conference) – Menu Trends:  What the Top 25 Chains Are Pouring. The presenter was Michael J. Ginley, a Partner at Next Level Marketing (http://www.nextlevel-co.com).  Ginley suggested that 86% of the top twenty-five full service restaurant chains list at least “some” drinks on their menus. He then stated that he was puzzled that the number isn’t 100% since there is evidence that the practice improves sales.

But there’s more. In October 2009 I published a blog “How to Sell Less Wine”. In it I cited the remarkable Cornell wine list placement study. Thanks to Sybil S. Yang and Michael Lynn, Ph.D., and The Center for Hospitality Research at Cornell University we now understand which wine list attributes correlate to increases in wine sales. In their breakthrough finding, “Wine List Characteristics Associated with Greater Wine Sales”  [Cornell Hospitality Report, Vol. 9, No. 11, July 2009, http://tinyurl.com/6c8tsc9], Yang & Lynn detail how they meticulously studied the wine lists and wine sales of 270 restaurants spanning several major markets.

In my blog I summarized the findings, and now refer to this one: Wine list design: only two attributes were found to correlate to higher wine sales: placing the list on the menu (instead of a separate book), and not using the dollar sign ($).

Are you using your dinner menu to optimize beverage sales?

Those are my thoughts, let me know yours.

Post to Twitter

Time to Lose (Inventory) Weight?

Well, this IS the month to trim fat, right? Every fitness center is filled, this is the number one month for fitness center enrollments, etc. But I’m not concerned here about body fat. Not that I don’t have plenty to be concerned about. The topic today is inventory fat. That’s right: inventory fat – otherwise known as dead inventory – is bad for you. 

What is dead inventory? Usually I think of beverage inventory. Mostly wine. Food inventory is easy to work out: banquet menus, employee feeding and systems for daily specials enable us to do this with some ease. We’ve gotten good at it because it’s perishable, and because storage space is limited. Dead beer inventory happens – hard to sell that summer seasonal in December. But in my experience it doesn’t represent a lot of dollars. Spirits can be a problem if you let distributors make your inventory decisions for you by giving you “free” sample products you wouldn’t otherwise order. How’s that banana-lime tequila cordial working for you, the one your distributor swore was the hottest thing going in (name any trendy area in California)?

So, we’re back to wine. I’ve seen dead inventories as high as $100,000. I’ve seen dead inventories that increase year after year after year with no movement. Does your bar accounting team wear dust masks when they do your beverage inventory? Like those extra pounds you want to shed, you know the risks of too much dead wine inventory:

  • Ties up cash
  • Perishable – it goes bad eventually
  • Takes up valuable storage space
  • Discourages you from updating your lists with the latest products

The most commonly used methods for reducing old inventory still work. “Selling” it to the kitchen and “selling” it to your sales and marketing department for VIP amenities, sales gifts, etc.

Here are some additional ideas:

  • Have a “Wine Sale” – Use this to build business on slower nights by offering it on those nights only. Example:  Sunday & Monday half-price bottles
  • Or, make a separate half-price wine list, noting that these are available until sold out
  • Or, where legal regulations allows this, prepare a half-price “to take home after dinner” list (unopened by you, of course)
  • Or, a variation – a BOGO. Buy a bottle from our “special” list for dinner, get a second bottle “free” to take home. (Promotional wording and procedures subject to your local regulations, of course.)
  • Pour off as a special BTG Happy Hour promotion
  • Create a “special” list with lucrative employee incentives for selling these itrems. Increase the value of the incentive with each sale. $2 for selling the first bottle. $3 for the second. Up to $5 per bottle. In other words, “give” the discount to your employee instead of the guest (or price it so the discount is “shared”).
  • Create the world’s best Sangria, and promote it

Those are my thoughts, let me know yours.

 

Post to Twitter