Now that headline sounds really stupid, doesn’t it. Yet, if you look at most of the chains and independents that have come through the recession successfully, you see that they have done exactly that. They updated their trade dress and food, treated customers and staff differently, and made changes in their marketing programs.

But what most did not do was change who they were. Their core identity is the same today as it was 5 years ago. In QSR, McDonald’s is still a fast food place. An all-American one. But it has added a lot of successful items to its menu, which is a change from the philosophy of offering fewer items done properly. Their challenge was to maintain a quality level while expanding. Apparently, they succeeded.

On the other hand, I see PF Chang’s maintaining its identity and not noticeably changing anything. It still is an attractive Chinese restaurant, appealing to mainstream Americans. But I don’t see any major changes taking place in the food or décor…and I believe their performance is just so-so.

At a higher price point, the Roy’s chain is another victim of the recession. Has anything changed? Yes, they would say. “No”, most of the public would say.

One could run down a list of 100 chains and large independents and identify those that successfully changed without changing their core positioning. Unfortunately, one could find more examples on the list of those that either failed to change, or changed so that they moved their positioning and had a net loss of guest count and dollars.

So how do you find the formula for change that will not take you away from your core customers?

(1) Be sure you understand who and what you are. Talk to customers informally and via formal research. Be clear. Put your identity and positioning in writing. What if your public has a broader vision of who you are? Aha! Room to add new items within that same vision.

(2) Look at your existing menus. Are there items or categories that have room for expansion? Or slow movers that can be replaced by updated versions of the same item? Each of these represents opportunity.

(3) Go to the front entry of your most representative store, or perhaps to your most successful store. Go out from there and visit 5 or 6 of the most direct competitors you can identify. Then return to your unit. How does it look to you after you’ve seen your competition? In many cases you will see that the décor is tired and the menu has aged. Just updating things will create a sense of change.

(4) Write down the age or income range that encompasses, say, 75 % of your customers. Now identify some competitors who deal with an age group that ranges about 7 years younger, with incomes appropriately lower. What are they doing to appeal to that younger group that you can do, within your concept? Do it.

(5) And if you are a truly creative restaurateur, then you’ll come up with some things that never existed before, and when you try them, ¾ may turn out to be highly successful.

Sometimes, a concept has had it. If you change without changing, you just extend a loser. In which case you have to think about how to change so that you are new and exciting once again. Most of the coffee shop chains are facing this challenge, either because of aging of the concept, or changes in the make-up of the population. As I’ve said to a couple of such chains, you are trying to sell apple pie to Indonesians. (Ethnic changes around locations is quite a topic of itself.)

In these cases, it’s time to recognize that one needs to either do a major repositioning or become something else.

Most people, even very successful ones, cannot touch and feel what they cannot see and hold. Others among us do see the invisible; these fortunate people see “ideas”. And the best of these people see how to apply those ideas and make a difference.

Most people in the restaurant business are focused on getting their menu in good shape. The quality is to be there, the food costs and delivery times under control. Things just humming along. Unfortunately, too often things are humming along with declining guest count, or declining margins, because there are no new ideas to excite the customer base.

On the other hand, somewhere out there, invisible to the naked eye, is an idea. Something that will change the structure of the menu, perhaps. Something that will put the restaurant or chain in the forefront of people’s decision making regarding eating out. Don’t put your menu management first. Put innovation first, and then apply menu management. Otherwise, you’ll never be looking for the ideas.

Here are some examples:

Someone had an idea regarding choice meat steakhouses. Dress the stores up to the same standards as the establishments serving prime meat. Where’s the logic to that? But it was an invisible idea that made Sullivan’s and Capitol Grill successful.

One of my clients had a solid following at a family-priced menu level. But he believed there was no way to increase the average check except to push dessert and other add-ons. Ah, but there was an invisible idea. We got him to look at what the higher end chefs were doing in his category. They had changed the type of food being served. My client was able to offer the new types of food at much lower prices than the higher end places, and still raise his average check. Customer count jumped up. Just an idea, but we saw it; it was not invisible any longer.

Many readers know of Peter Drucker, a famous teacher and writer regarding management. To me, his most important principal of many was to separate operating people from the innovative process. Operating people have to give priority to operating problems. So they tend to be preoccupied only with what’s there to be seen. By turning innovation over to non-operators, innovation was in the hands of idea people. And, in fact, if you look around at many chains today, R & D reports to the marketing department, not the operations department. And, such heresy, we now see executives rising out of the marketing department to take over COO and CEO roles. IHOP, Patina, among others.

Still, many chains are headed by smart people who do not respect what they cannot touch and feel. Their ad agencies make sure to show complete work, so the ideas are not at all invisible. But again and again, I’ve noticed that such chains will be followers, not innovators. Following may work for some – but it is a dangerous path because the ideas are not your ideas, not just right for your chain or restaurant.

So here are the three rules to follow if you want to see the invisible ideas…

(1) Have at least one senior person on your team that loves ideas, seeks ideas, and will be the champion of good ideas. Otherwise, the ideas will go unnoticed – that is, until a competitor picks the idea up and runs rings around you with it.

(2) Be supportive, and give some degree of independence, to those on your staff who are seeking the new ideas. They need to have confidence; in fact, even the right to fail now and then. Otherwise, they are likely to underperform.

(3) Show respect for what competitors are doing in the new product arena. This is the benchmark that your team needs to outperform. So formalize the process of checking on the competition.

My customers loved my menu,
And I loved being the boss.
‘Till competition innovated again and again,
And my place became a total loss.
Oh, somewhere there’s a fellow I fired
Because he wanted to change my menu,
But now he is out of reach to me,
…He retired!

Yes, it’s been a rough year out there for a lot of businesses, and therefore for a lot of individuals, too.

But the restaurant industry was not without its successes . And many of these successes proved that certain principles I have believed in, are indeed valid.

(1) If you position yourself properly in price and value, you are better off introducing attractive new products than you are in using discounting to build traffic.

Restaurant News had an item. At a meeting, about 40 operators acknowledged that they had tried Groupon to attract business. Every one of the 40 said he would not repeat the experience.

Discounting of any type brings in 3 kinds of customers. One group are there for the discount; they only go where there is a discount. No loyalty there. Another group, probably the largest, consists of current customers. They are the most likely to use any available discount. This might accelerate a visit, and thus increase business. But it doesn’t take too many such visits before those customers will only come in when there is a discount.

And the smallest group consists of new visitors introduced to your restaurant by the offer. Too few in number to make up for the harm done.

On the other hand, I have clients with sales ahead of 2010, without a single discount offer for the year. Their secret? Exciting new products that accelerated visits by existing customers and brought in numerous new customers. Granted, development of new products is not free and easy; it takes time, talent, effort – and thus expense. But good new products build a solid customer foundation.

(2) Just because money is tight, you needn’t lower your average check.

I’ll never forget the scene. A Friday evening in Phoenix, a city hit very, very hard by the recession. At one location in a working class neighborhood, there were 6 or 7 restaurants, all but one close to empty. The other had a line outside the door, because it offered its regular menu at a very affordable everyday price. That was Olive Garden. Not expensive food, but decent quality for the price, and an attractive value where money is tight. (And a very good advertising campaign that goes on and on.)

Not all restaurants can build on that platform. One of my clients has a solid menu, very affordable, but not much new going on. If we introduced higher priced items, would we re-position the chain as higher priced and lose business? Our solution was to create a new line of somewhat upscale products presented as a menu within the menu. Higher priced, but with a strong rationale for the quality. We ‘branded’ the new department, in a sense isolating it from the rest of the menu. Big success, responsible for much added sales. The rest of the menu continued to do ok, as new customers discovered the restaurant.

(3) Do not let the hard times show in any part of your restaurant or chain.

No deferred maintenance in the front of the house, please. Hard times should not mean shabby restaurants. The public goes out to escape the hard times, and instinctively feels it when there is one too many tears in the vinyl seat, or a crack in a window. The staff feels it, and somehow, inadvertently, communicates this to the public. So…find a way.

You can afford to be aggressive about showing a strong front to the public. One way is to re-design your menu. The bargain of 2011 for me, was the work one design team did to redesign a client’s menu. It gave a lift to the entire operation. In other instances, just switching the art design team to make point of purchase materials more attractive, generated added sales.

(4) You needn’t spend big money to match the big boys in advertising quality.

One of the side benefits to you of the recession, is that many good advertising and marketing people have joined the ranks of the unemployed or early retirees. (In the ad agency business, 60-80% of overhead is payroll. Billings go down, even good people get let go.) Seek out this talent. They will appreciate the work. And good artists, good talent, do not compromise quality. I use talent from this source a lot.

(5) Don’t fall in love with the internet.

Date it. Take it to dinner and a show. Build a nice relationship. But notice that many companies have backed away a bit from the commitment, building their media plan on a mix of internet and traditional media. TV is not dead! It just has to share. What is the ideal mix? That depends on the profile of your target audience and your particular marketing strategy. I admit it; I am a player. Whichever media is attractive for the need at the time, is the media for me.

So 2011 wasn’t so bad. Thanks to new products, new menus, and placing before the public a strong, confident, attractive attitude. After all, everyone loves a winner.

You can bet your last dollar that creative impact still matters. A lot of businesses feel that social marketing covers the marketing area. Others that the new forms of discounting and couponing will provide.
But nothing builds a store or packaged goods brand, and the accompanying profitable customers, like ‘creative impact’ in your marketing program. Creative impact defined: : A selling message that is so compelling, that it brings in a disproportionate number of buyers on the basis of words and pictures alone.

Most marketers are so busy with their websites and e-mail programs, that they give less attention to TV, magazines, even direct mail, than they used to. Yet, according to most observers, there is a trend towards balancing the traditional media and the internet-based media. Unfortunately, most of those in traditional media have forgotten the value of commercials and campaigns that turned around the fortunes of Jack-in-the-Box, and Carl’s Jr. in the West, or Volkswagen, and Avis in their day back East. Or Virgin America, “Got Milk”, and Meat-It’s for Dinner.

Of course, if you run advertising that is dull, and unproductive, you can convince yourself to stick with the internet. But if you will take just these three steps in developing ads for traditional media, you will enjoy the fruits of your labor.

(1) You are looking for something that has not yet existed in the history of mankind. That means you need a resource with true creative talent, be that an agency or an individual.
Look hard for this resource; possibly even retain someone such as myself who has spent a lifetime evaluating such work.

(2) You have to give this resource a message that is important. A new food ingredient, a new menu, machinery that outperforms its predecessors. So this process actually forces you to get going with new and better products or services.

(3) Now the struggle begins. You want your story told. But you don’t want to upset anyone. So you and your agency struggle and maneuver, negotiating dramatic but upsetting against beneficial but dull. Until….the birth of a new message takes place. A dramatic way of presenting your product or service selling message. One of the most difficult skills now comes into play. Is this the best that can be developed? Or should we go back to the drawing boards and give it another try? How do you judge whether the potential creative standard has been met or not. I’ve had to make this choice 100 times; in half the instances, what came back was, indeed, superior and worth the extra trouble. That’s because of all the effort that went into getting to the level of the moment; now the creative people can focus on what they’ve created, and how to make it more dramatic.

Surprise. In my experience, such good advertising find its way into the company’s internet program after all. The company speaks with one voice.

This is a new technology and it keeps changing…quickly. Ok, so I thought I knew my way around websites and e-mail marketing, especially restaurant websites having been involved in developing 7 or 8. Confident enough to make the mistake of not watching over the process very, very closely; On behalf of a long-time client, I retained an expert. It never occurred to me that (1) the expert didn’t really know how to connect parts of the home page to the relevant other departments. The costs to retrofit that site endangered a long-time relationship. (2) The expert’s experience with e-mail marketing’s technical side was at least a year out of date.

The most important first question: I have seen too many companies enamored of the internet. Jumping ahead without thinking things through. But the first question really should be, “What type of marketing program do I need? Most clients I meet did not know the answer, and then, of course, had proceeded to retain the wrong type of consultant.

Getting the website right. How can you tell the right firm, when the candidate(s) have great credentials stretching back a year or two? My answer: You look for the kind of intellectual intelligence and artistic talents, that won’t stand still. So few website designers truly keep up with the technologies. How to have the site read on a computer screen is one thing. How to get it to read on assorted pda’s is a more difficult task. After being disappointed by several firms large and small, a friend introduced me to a fairly large web design firm named HYFN. They work!

But what about the actual internet marketing. That, too, has proven to be difficult. These marketing firms need to combine (1) salesmanship, (2) technology, and (3) strategic marketing sense. I found a small firm recently that appears to have it all together. Lynne Dundas of Dundas Direct showed that she can put a program together from a standing start. But I think that’s because she invests a lot of time in staying current with the technologies. She has clients in many fields. She helped me to refine my procedures, to be sure the internet in all its glory was used the right way, for the right price.

The simple steps: Look at the steps to start a successful program. 1. Have a marketing strategy, and a program. Then, if you decide the internet is the right channel… 2. Redesign the homepage to capture the current technologies (old sites often do not get through), and to sell prospects more effectively. 3. Make sure there is an offer of some sort. 4. Test Google ad words campaigns. 5. Create new e-mail templates. 6. Test it all, change it all, until it perform. And do not take anything for granted.

If the internet is for you, then be sure you have a person or people to guide you in developing a strategy, and looking at the resources. From the engineers/designers who handle all the graphics, to the artists and writers who persuade the viewers. As the title says, this internet marketing is one tough cookie. (I think back to the days when ad agencies decided to produce the TV commercials ‘in house’. Mostly, that didn’t work so well either. Today’s ad agencies are trying this with the engineering of the site. We’ll see.)

I am not an agent of Lynne or HYFN. But they both helped me to learn to be very, very careful when retaining people in this new industry. In fact, I am building a little folder with two files; one for ‘good guys’ and one for ‘bad guys’.

In future blogs, I’ll talk about other fields and other leaders of the future, and how to avoid dead ends.