A recipe for success
Today, everybody’s trying to save a buck, but a guy’s still got to eat. For fast-casual and fast-food chains, it would seem a no-brainer to slash prices on popular offerings and stand back as the crowds rush in. That’s the tact taken by Yum Brands Inc., but the low-priced fare didn’t quite pay off. Taco Bell’s and Pizza Hut’s second-quarter, same-store sales actually declined in spite of economically priced menu items.
So why weren’t consumers attracted to the cheaper eats? According to a recent Performics study, 69 percent of consumers surveyed said they are spending less money on eating out. This means consumers aren’t going to be swayed by low-priced promotions if they are already making a conscious decision to eat more meals at home. In fact, popular restaurant chains are looking to store-bought frozen meals as alternative income. California Pizza Kitchen, Starbucks and Burger King are among the many chains with restaurant menu items for sale in supermarkets' frozen food aisles.

But, restaurants can’t rely on packaged foods for long. To woo customers away from their eat-in kitchens, some restaurant chains are looking to draw crowds with incentive programs. Denny’s introduced a Grand Slam Bahamas Vacation Getaway promotion. Customers can earn scratch-off game cards by purchasing special menu items. Prizes range from free food and beverages to a grand-prize Bahamian vacation for two. Or, for the truly daring, Chick-fil-A honored Cow Appreciation Day by offering a free meal to anyone who stopped by its franchises dressed like a cow.
Restaurants are quickly learning that consumers in this economy are changing their habits and saving at unprecedented levels. To move dinnertime out of the house, restaurant chains are going to have to learn to get creative. Price cuts can’t be the only answer. Give consumers a reason to spend their hard-earned money in your restaurant.
Tags: economy food promotion
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