5 Types of Promotions Restaurants Should Never Run
Running a promotion might seem like a great way to get more customers into your restaurant. Discounts, contests, or other special attractions can only be good things, right? Well, not exactly. Although drawing attention to your restaurant is usually good, there’s definitely such a thing as the wrong kind of attention. If you’re not careful, your restaurant promotions could lose money, get bad press, or even put you on the wrong side of the law. Read on to find out what promotions your restaurant should never run (as well as a few examples of restaurants that learned this the hard way).
Customers love happy hours and drink specials, but check your state/city regulations to make sure the promotion you’re offering is legal. Different areas have different alcohol laws, and it can be illegal to offer drink discounts, specials, or free drinks. Breaking the law might bring in a few more customers, but it won’t be worth it if you end up with a hefty fine.
Participating in your city’s restaurant week seems like a good idea on the surface. You get visibility, tons of new customers, and you show that you’re part of the community. But does this promotion actually benefit your business? Many restaurants can’t make up for the deep discounts they offer during restaurant week and they end up losing money. What’s more, the customers who buy meals at a significant discount often don’t bother to come back later to buy the same meal at full price.
While all-you-can-eat deals work sometimes, restaurants must be very careful to make sure they’re not losing money. In 2003, Red Lobster offered an all-you-can-eat snow crab leg deal that ended up costing the company $3 million. Not only did Red Lobster vastly underestimate how much snow crab each customer could eat, but they also launched the promotion when snow crab costs were up. The lesson to learn here? Always do research if you decide to offer an all-you-can-eat deal so you’ll be sure to make money. Chances are, your restaurant can’t afford to lose $3 million!
Coupons can be great—after all, who doesn’t love a discount? But just printing coupons without any other promotional strategy to go along with them isn’t effective. What’s worse is that it conditions customers to expect your food at a discount. Promotions with a bit more creativity and customer involvement are much more successful.
Anything that gets the wrong kind of attention.
All press is certainly not good press when it comes to restaurant promotion. Sure, you want to get your restaurant’s name out there, but not at the cost of your reputation. Don’t ever do anything that compromises your customers’ privacy or takes advantage of people or animals. This might seem like a no brainer, right? It wasn’t for one LA restaurant that decided to chain a donkey to a fence outside the restaurant in 85 degree heat as a Cinco de Mayo promotion. You want people talking about your restaurant, but not if it also involves a PETA protest. Before running a promotion involving anything living, be sure to consider if there’s any way it could be considered offensive or harmful.
When you’re coming up with restaurant promotions, keep these ideas in mind. Remember that while you want people to talk about your restaurant, you want them to talk about the right things. The real focus should be on your food and service, not on an embarrassing promotional stunt that loses money, business, or respect. Follow these tips next time you’re ready to plan your next promotion.