Episode Transcript
[00:00:00] Speaker A: It's never been harder than it is right now to run a profitable restaurant. And it begs the question, right, I'm going to beg you to answer this question.
Who needs what you have? The answer, surprisingly, is no one. No one needs what you have. No one needs a restaurant. Nobody needs their food prepared for them. And yet millions of people all over the world, every single night decide to have other people prepare food for them. They that is extraordinary. But we have to understand where it fits in the ecosystem, where we fit within people's lives. Today, I wanna talk about understanding what you actually serve and how you can succeed. This is a 30,000 foot view, big picture, strategic conversation. Don't go anywhere.
There's an old saying that goes something like this. You'll only find three kinds of people in the world. Those who see, those who will never see, and those who can see when shown. This is Restaurant Strategy, a popular podcast with answers for anyone who's looking.
Hey everyone, thanks for tuning in. My name is Chip Close. This is the Restaurant Strategy podcast, a weekly show, two episodes every single week. All meant to help you level up building more profitable and sustainable business. I write books, I give talks, I host this podcast. I also run a coaching program. It's called the P3 mastermind. We have an incredible community. More than 150 people currently enrolled in the program. Over 300 people have already gone through the program. The bottom line is the program works. If you struggle with profitability, I can show you a way to make money from your restaurant. The best way to get started is to have a conversation. It's absolutely free. 30 minutes. We're going to get to know each other. Go to restaurantstrategypodcast.com schedule again, absolutely free. Grab time on the calendar and let's just get to know each other. If you're a good fit for the program, we'll talk about what next steps look like. If you are not a good fit for the program, we'll still give you some actionable advice so you know what you should do next. And we'll set a plan to resume the conversation later again. RestaurantStrategyPodcast.com Schedule and as always, that link is in the show notes.
Avi, you love to go out to eat. So as a guest, what's your biggest pet peeve when you're trying to choose a place to eat?
[00:02:31] Speaker B: Yeah, as the father of two children, I can't leave the house for less than $30 an hour. My wife has celiac. So when we're going to make a dining decision, I live and die by that menu. I'm in there researching what's available. What can my wife eat? What can we share? What do I get to eat off of her plate? Um, and so that menu is just a crucial part of all decision making for me as a consumer. It's why at Marquee, we focus so much on our menus, our menu integration, so that as operators, your menu that lives in your point of sale that you want customers to see is available and up to date everywhere.
[00:03:04] Speaker A: To learn more about Marquee, go to marquee.com m a r q I-I.com to learn more about this and all of the incredible features they have.
Okay, so the question I posed at the very top of this episode is, who needs you? The answer, I think, is a resounding no. No one. No one needs what you have. No one needs what our industry provides. The bottom line is people very much want what we have, but we have to identify, we have to embrace, acknowledge some realities about what's going on in the world, what's going on in our industry. Number one, we already have too many restaurants, right? Restaurants on every corner, every block, three, four, five of them. We have so many restaurants. How many pizza places are in your town? How many sushi restaurants, Chinese restaurants, Greek places, Mexican joints? We have too many restaurants. So why would anyone care about one more? Why would anyone care about your restaurant? The bottom line is the reality, the cold, hard truth is most people don't care. They don't care that there's one more restaurant in the market. And guess what? They don't even care. When there's one less restaurant in the market, one restaurant closes, they hardly notice, hardly skip a beat, because there are plenty of other options out there. So the first reality is we already have too many restaurants. Number two, we are dying. Absolutely drowning in a sea of sameness. Talked about the pizza places. How many pizza places are out there that all serve cheese pizza? How many serve pepperoni pizza, mushrooms, olives, sausage, whatever. It's the same. How many taco places are pretty much the same as everything else? How many Chinese restaurants. They all got your sesame chicken. They all got. Got sweet and sour pork. They've all got fried rice. They are the same.
We are drowning in a sea of sameness. I'm gonna talk about why that's so dangerous, right? I talked about this at the top of Dining out is expensive. People are picky about where they spend their money because as we're seeing inflation, as we're seeing wages stagnate all over the country, people have to hold tighter onto their money. And they are still spending money. They're going out, they're having fun, but they're being more deliberate about where they spend their money.
To that point, you have to understand that we are not selling food. You do not sell food. You serve food, but you are selling an experience.
We sell connection. We sell celebration, enjoyment, wonder, relaxation, joy, indulgence.
We sell way more than food. There's a lot of great places to get a good meal. What we are selling is everything else we are selling. This idea of being pampered, of having somebody else shop, prep, cook, serve, and clean up later.
That is the very definition of an indulgence.
I want you to think about why people, why anyone would go out to a restaurant in the first place.
I think people go out to a restaurant because they don't have time either. They don't have time to shop, they don't have time to cook. They don't feel like cleaning up. They're sick of the food that they make all the time. They're getting bored of the same old, same old. I know I fall into that.
I know I fall into that trap. I'm guessing many of you do, and I promise you, thousands and thousands of your diners do. I think people go out to dinner because they want to be taken care of. Because people work hard in their lives. They run here, there and everywhere. Shuttling their kids here and there and everywhere, taking care of their parents, all the other responsibilities, doing their job. Sometimes they just want to go and be waited on.
And I think.
And I think the last reason why people go out is because they want to feel attractive and they want to feel important.
They want to mark an occasion. They want to celebrate. They want to be pampered.
People are important. All of us are important. All of our guests are important. And I think all of us want to feel attractive at some point in our day, at some point during our week. I think that's why we put on clothes that we like, put on clothes that we feel we look good in.
It's why people put on makeup. It's why they do their hair. It's why they buy nice cars. It's why they go out to a restaurant because it makes us feel important to have somebody else do it for us.
All of those reasons, and not one, not once, did I mention that they want to be fed.
Because people can go feed themselves anywhere.
We can go to a supermarket, feed a family of four for less than 20 bucks.
Good luck feeding a family of four in a restaurant, even a McDonald's, even a fast food joint for under 20 bucks. I think it's hard things, damn near impossible.
People do not go out to restaurants to feed themselves.
The meal is the pretense for the event.
But they are going out for many other reasons. Remember I said we don't sell food, we sell experiences. We are selling connection, right? The opportunity for people to share good conversation, have a good date to mark an occasion.
We are selling celebration, right? Celebrate your birthday, your graduation, your promotion, your anniversary. We're selling enjoyment.
Food is.
Food is worth celebrating. Food is to be enjoyed. Wine, cocktails, beer, it's all meant to be enjoyed.
Wonder, joy, relaxation, indulgence. All of those words are words I shared a few minutes ago. All of those have everything to do with, with why we go out. Not to eat.
Not to eat.
Because I can make food at home. Sometimes I don't feel like making food at home.
I can go to the supermarket, I can prepare dinner. Sometimes I just don't feel like it. I'm sick of it. I just want to be taken care of.
There's so many reasons why people go out. And because they get hungry is not really on them.
Remember, I've said this a few weeks ago when we were talking about this luxury mindset. But no one, and I mean no one, needs to have their food prepared for them.
In fact, much of the world, we take for granted because we live in a developed western culture.
But no one needs their food prepared for them. Much of the world would never dream of paying a premium to have their food prepared for them.
Much of the world doesn't have the money to spend on such an indulgence.
But much of the world, it would never even dawn on them to spend 3, 4, 5x what they otherwise would, simply to have somebody else think up a menu, go shop, prep, cook and clean up later. It's an indulgence that they don't have the luxury of participating in.
Much of the world would never dream of it. If you skip over that fact, if you do not acknowledge it, you are missing the whole point of what you do for a living.
And so it begs the question, who actually needs your product, the thing you serve, the experience you craft.
If you understand that nobody actually needs it, that people do it because they want it, that changes the whole ball game. And again, we talked about this, this difference between a commodity and a luxury. If I have to drive my car to work and back home every day, or work and then pick up my kid from School and back home. I need my car to go, so I need to put gas in it. That's a commodity. I need that to make my life happen, to do the things I need to do.
Going out to dinner is not a need.
So now we're dealing with wants and not needs.
They have to need you on a level that's higher. If we think of Maslow's hierarchy of needs.
They have to need you at a level that's higher than satiating their base needs.
It is not about survival.
It is about status. It is about enjoyment. It is about connection, community.
All of the things I mentioned earlier. Celebration, joy, wonder, indulgence.
And then you've got to answer the following questions to have that conversation. Number one, what do you have that no one else has?
If you've got something that can be gotten elsewhere, people will go get it elsewhere. A place that's closer, a place that's cheaper.
How do you convince people to come in the first time to try you out if they don't know you? How do you convince them not to go to the place they already know and love and trust and to come to try you? You have to answer that question. How do you convince them that you are worth coming back to? You have to answer that question.
Trust me. It's not because you got the best chicken parm. It's not because you make great martinis. It's not because your dressing has some secret ingredient that your grandmother taught you.
All of that stuff is fine. That's part of the story.
But I've had really good chicken parm. And I couldn't tell you the name of the top 10 places that made it for me because it's chicken Parmesan. Who cares? It's chicken. Pounded, breaded, fried, tossed with sauce and cheese. Who cares? My son is nine and he could make it martini. It's two ingredients stirred.
There's plenty of people who are capable of making a quote unquote great martini, but it's because the guy knows that you love a martini. They know the spirit you want and the way you like it served. They make good conversation when they serve it with you. The lighting in the place makes you feel attractive.
The people you are around at the bar help you to become the person you aspire to be. There are so many reasons why somebody would go to that specific restaurant, that bar, to have the martini that's made for them, not because it's a great martini.
Martini, by the way, is something you could make pretty well at home.
It's pretty Idiot proof, very difficult to screw up.
So no, it's not because you got some magical chicken parm and you make great martinis. It's not because of some secret ingredient that's in your salad dressing.
I think the whole thing is about the way we make people feel.
To take this out of hospitality, out of restaurants entirely.
Nike makes people feel a certain way.
Apple, Mercedes, Chewy, Disney, Harvard, the New York Yankees, all of these are iconic brands in very different businesses, in very different industries.
And they make the consumers feel a certain way, which is what people come back to.
Nike is about performance.
People who care about performance return to Nike over and over.
Apple is about empowerment. It's about the individual, clean, sleek products that do what they're supposed to do.
Mercedes, classic luxury, Disney family, Fun, entertainment, smart forward thinking, all encompassing. Now not just a media company, but a hospitality company as well.
Harvard, the number one college in the United States, the New York Yankees, this iconic baseball brand.
All of those brands, when I said that made you feel a certain way, whether you're a Nike fan or not, whether you're an Apple fan or not, whether you're a Yankees fan or not, they made you feel a certain way. We think about those brands in a certain way.
People come to you because you have something that no one else has. And I don't know what that is.
Maybe you are just the most convenient place on the way from school to home or away from the dance studio home.
Maybe you are right next to the train station. That's convenience.
But there's something about what you have that nobody else has.
And I think the way we corner this market is by focusing on the interaction, on the people.
We do not sell food, we sell experiences, we sell connection, we sell feelings. The way that people feel, the way that people feel when they align themselves with our brand, when they sit in our room, when they order our food, when they carry our to go bag down the street.
I had a woman once, she was a regular at a restaurant that I had worked at and she would shop at Hermes like once a month. And she said Hermes is always the first stop I make when I'm going to go to Hermes. It's always the first stop I make because I like the way it makes me feel carrying that iconic orange bag down the street. I like the way that other people look at me.
And she looked at me in the eye and she said, I know it's so stupid, it's so childish, but I love that.
And I love that she was honest with herself because I think A lot of people do that.
I think a lot of people like to be thought of in a certain way.
I remember when I first moved to New York, I got a Yankees hat. I felt like a New Yorker. I felt like I could finally wear this Yankees hat.
That was over 25 years ago, but I wore that in those early days like a badge of honor.
Moving to New York was always something I wanted to do, and I did it. And the Yankees have proved that I belong there.
In my eyes, whether I belong there or not, in my eyes, it was a sense of belonging.
Mark my words. It is the same with your restaurant, the way you get out of the sea of sameness, the way you get to charge. What you need to charge, the way that you have a line of rabid fans is to create something that no one else has.
The other day, I was talking to one of my clients and we were talking about egg slut. Egg slut basically has, for lack of a better term, one item on their menu. And their lines are down the street, around the block. And it's way more expensive than any of the alternatives.
But people are willing to line up, pay extra, go out of their way for their product because of what it is.
You have to have something that is worth paying extra for, that's worth going out of your way for, that's worth waiting for for.
That is how we get out of this commodity mindset.
To be really clear, we don't sell food. We sell experiences. The reason people come to you and come back to you is because the way you make them feel, the way your food makes them feel, the way your brand makes them feel, because it helps fortify a story they tell themselves.
That's true if you're buying a Toyota. It's true if you're buying a Bentley.
The brand helps fortify something about what you believe.
Somebody who buys a Toyota says, well, I wouldn't buy a Bentley. It's so, so expensive. I don't need that sort of indulgence. They pride themselves on the pragmatic, practical car.
The person who buys the Bentley says, I can afford to buy a car that is impractical and overly expensive because I love this. I love the way I feel. I love the way it makes other people look at me.
It says something about who I am and the status I've attained.
Every product people buy tell a story.
Every product people buy help fortify the story that people tell themselves.
Your restaurant, make no mistake. Even if you just got a bagel shop, coffee shop, little ice cream parlor, same thing. It helps fortify the story that people tell themselves, what they believe about themselves. Mark my words. Nobody needs another taco. Nobody needs another General Tso's chicken. Nobody needs a plate of sushi. Nobody needs an ice cream cone.
They come out because they very much want it.
And when you start understanding that you are selling people their wants, not their needs, it changes the way you. You talk to them.
If we are to make it out of this year and make a more profitable business than we've ever had before, you have to embrace that. Create something that people can't get anywhere else.
Build a connection with them that can't be gotten anywhere else.
Help them tell their story.