Kids Marketing

Millennial’s are now a larger audience, and arguably more profitable audience for restaurant marketers, than even Baby Boomers. As a result, restaurant marketing strategies and restaurant marketing budgets are being revamped to win the younger generation.  According to Media Awareness Network (MNet), the advertisement industry’s spending on children has exploded in the past decade, increasing from a mere $100 million in 1990 to more than $2 billion in 2000 (okay, working on getting some updated figures, of course, but at least this one is illustrative of the trend which has been building for years and now reached a tipping point).

Millennial’s often have higher frequency and be dubbed “heavy users” particularly for QSR’s and fast casual restaurant concepts.  They have disposable income that is undeniable, and like the generation before them, continue the trend of spending higher percentages of their food dollar in restaurants than grocery stores.  This audience can’t be overlooked.  The approaches to reach them involve considering new approaches to everything from menu recipes and names, to digital marketing over traditional advertising techniques, to location strategy, and so much more.

The new generation thinks, talks, acts, behaves and generally communicates much different than those that preceded them.  Sure, one could say it has always been that way. What’s different in this case though is that they were born after the invention of the Internet and cellular phone.  This is the first generation of “digital natives”.  The older surviving generations are “digital immigrants”.  The rules of communication have fundamentally changed.  It is very intriguing to me that the majority of the marketing budgets are controlled by digital immigrants, but – for many restaurant concepts – the majority  of their employees and customers are digital natives.  This fundamental difference in how both were raised to communicate is often a cause in some failed restaurant marketing efforts, but it is also the source of great opportunity for restaurant marketers that focus on this emerging audience.

We pulled together some good stats that can help you build an internal case for shifting more of your restaurant marketing budget toward digital marketing in general, and kids marketing in specific.

Click here to read the full version of Restaurant Industry Special Report:  Marketing to Kids

The National Restaurant Association (USA) has reported the average restaurant marketing budget is three percent (3%) of total revenues. Critics argue this point and we’ve seen budgets ranging from zero to six percent (6%).  We believe this depends on the brand, operations performance, market conditions and a host of other variables. Yet, while many can generally agree on a reasonable allocation of overall sales, they pay surprisingly little attention to how the money is allocated beyond just falling into the “marketing budget”. Once you have the allocation, where does it go?

The Digital Marketing Toolkit

We recommend that of the three percent (3%) allocated to the marketing/advertising line-item, forty-percent (40%) of that be dedicated to digital marketing and publicity efforts. Going further still though, the budget, the strategy, timelines, the tactics, the messages, must now all be succinctly distilled and then divided among a number of cutting-edge new digital media categories. This list of vehicles is mind-boggling and it only continues to grow and fragment. You’ve got the Internet and Intranet, search engine optimization and Pay Per Click advertising, digital signage, narrowing-casting and Podcasting, RSS feeds, social media and social networks, Wiki’s, Widgets, Mash-ups, Analytics – the list grows and grows. These are sustainable emerging technologies too – not just fly by night digital jargon.

It’s Natural for it to all Seem Overwhelming

The marketing rules have changed in the digital era and the train is moving like a bullet. Yes, the principles of marketing – the four P’s, brand strategy, etc. – these remain as true today as ever.  They are bedrock and all too often marketers chase the latest fad while forgetting proven principles to restaurant branding.  While maintaining a close connection to the fundamentals of restaurant marketing we should also be reaching out to discover the innovative new approaches that will prove to be game-changers.  It all sounding complicated and overwhelming isn’t a good excuse for ignoring the seismic shift that’s afoot.

The Trend Will Pickup Velocity

Digital marketing is has only started to become recognized as a powerful tool in the restaurant marketers toolkit.  Today it represents a tiny fraction of the overall restaurant marketing budget for chains and independents alike.  Given that more than 30% of restaurant customers will visit the restaurants website before visiting the restaurant itself, getting a solid web presence and supporting it with a strong digital marketing and publicity campaign is more important than ever. 

Restaurant Consultant Aaron Allen

Some of the most significant inventions in the history of humankind have occurred within the last decade, and at the top of that list is the ever changing and evolving Internet.  In less than 5,000 days of existence, the Internet has forever shifted the worlds of media, marketing, friendship, employment, dating, selling, education, transportation, interpersonal communication and almost every other aspect of our lives. (For more on the future of the Internet, I highly encourage you to watch this short video from author and Internet expert Kevin Kelly as he discusses what to expect from the next 5,000 days of the Web.)

What restaurant marketers need to understand is that the concept of “digital marketing” is about much more than “the Internet.” When most people hear the word “Internet,” they think of Web sites and perhaps e-mail.  However, digital marketing stretches much further than the Internet and the “digital world” – like a giant cloud – has begun to become inescapably intertwined with almost every area of our lives.  While this new reality incites saber-rattling among conspiracy theorists, it evokes jubilation among modern-day marketers.  The reason? Digital marketing delivers.

There’s an old saying: “Half of all advertising is wasted; the problem is, no one knows which half.” The funny thing is, in the new world of digital marketing, this old saying is no longer true. Digital marketing offers advertisers the Holy Grail: efficient, measurable marketing with costs that are directly linked to results.

Even more encouraging for restaurant marketers, digital marketing is the best way to engage the restaurant industry’s most prized, if misunderstood, audience – Millennials.

A mix of Gen X and Gen Y, the Millennial generation includes anyone born after 1983. For reasons of demographics, culture and consumer tastes, Millennials are now a larger and more profitable audience than Baby Boomers for the restaurant industry.  Millennials are “digital natives,” meaning they were born into the world of new digital technology and grew up using it – they are especially adept at using computers, smart phones, social networking and other new media – and they expect the brands they love to join them there.

Today, for QSRs and fast casual restaurants, Millennials comprise a whopping percentage of your customer base – and equally important – a whopping percentage of your employee base.  They think, relate, interact and engage in the digital world – are you ready to reach them?

When you combine the powerful forces and efficiencies of digital marketing with the unbridled spending urges of Millennials, you have two of the most potent ingredients in a recipe for sharp gains in market share and revenue.

Now this is certainly not to say that Millennials are the only audience for restaurants. A growing and successful QSR or fast casual brand could hardly afford to alienate the other audiences it attracts. And this is also not to say that digital marketing is a silver bullet worthy of the whole marketing budget. Digital marketing is a component of a fully integrated marketing arsenal.

It’s More than Millenials

More good news: Millennials are not the only ones hooked on digital media. Far from it. The shift to digital media is global and it spans every one of the most profitable demographic and psychographic audiences courted by restaurant marketers today. Simply put: all of your customers are spending an increasing amount of time on digital media – that’s where “the eyeballs” are going.

Budgeting for Digital

The National Restaurant Association (USA) has reported that the average restaurant marketing budget is three percent (3%) of total revenues. Critics argue this point, and here at The Allen Group, we’ve seen budgets ranging from zero to six percent (6%).  Marketing budgets depend on the brand, operations performance, market conditions and a host of other variables. Yet, while many restaurant marketers can generally agree on a reasonable allocation of overall sales to devote to marketing, they pay surprisingly little attention to how the money is invested beyond just falling into the “marketing budget”. Once you have the money allocated for marketing, where does it go?

The Digital Marketing Toolkit

We recommend that of the three percent (3%) allocated to the marketing/advertising line-item, forty-percent (40%) of that amount should be dedicated to digital marketing and publicity efforts.

Going further still: the budget, strategy, timelines, tactics and messages must all be succinctly distilled and then divided among a number of cutting-edge new digital media categories.

This list of media and marketing vehicles is mind-boggling and it only continues to grow and fragment. You’ve got the Internet and Intranet, Search Engine Optimization (SEO) and Pay-per-click advertising, digital signage, blogs, narrowing-casting and podcasting, RSS feeds, social media and social networks, Wikis, Widgets, Mash-ups, Analytics, iPhone apps – the list grows and grows. But if you’re new to digital marketing, please understand that these are sustainable, emerging technologies – it’s not just fly-by-night digital jargon. All of these marketing tools are becoming more established and will likely be with us for some time. (Until something new takes their place!)

It’s Natural for it to all Seem Overwhelming

The marketing rules have changed in the digital era and the train is moving like a bullet. Yes, the principles of marketing – the four Ps, brand strategy, etc. – these remain as true today as ever.  They are bedrock and all too often marketers chase the latest fad while forgetting proven principles to restaurant branding.

But digital media is not a fad. It’s the future. The media as we know it is being transformed before our very eyes. And I think, after another 5,000 days in the life of the Internet, we’re going to be astonished to look back at how much has changed.

As leading executives in our industry with a leading brand portfolio, you don’t want to feel overwhelmed by digital marketing.  You want to feel overjoyed.  You want it to work, to be right for your business, and to fit with what already works.  The truth is that digital marketing is not rocket science, and it’s also not a magic bullet – but it can work, and it can help get the results you want.  You just have to make a commitment for that to be the outcome.

Restaurant Marketing Consultant Aaron Allen