In order for your restaurant to make money, you’ve got to profitably provide a product (food and drinks) or a service (catering or event management) AND there must be a group of people who desire that product or service. Those potential customers or guests are your market.

Communicating with your MARKET is called MARKETING. This should be a no-brainer.

Let’s say you’ve got a fantastic menu and a great service idea AND you’ve got a market that wants to pay good money for what you are offering. That’s only half the battle. You’ve still got to communicate with those potential customers and talk them into giving your product or service a try. Then you’ve got to communicate with them some more to keep them coming back.

Fail to do either? You broke.

Marketing is the process of communicating your message to your market – your current and/or future guests. And with the advent of social media, restaurants and foodservice operations are now using marketing on social sites to help build a community around their operation, products, and services. 

Don’t get this twisted around in your head: advertising and marketing are not the same thing.

Classical advertising – like on billboards and flyers? That is just ONE component of a successful marketing strategy. Marketing includes determining what products and services to offer (in other words, what you are putting on your menu), how to position your products in the marketplace (in other words, what KIND of restaurant you are opening), how to promote the whole thing to potential customers and keep old customers loyal to you, how to price your menu so people will buy your food, and where and how to build your restaurant so your customers can find you and get inside and start buying. 

Now-a-days, marketing drives how restaurants function. Owners and Managers ask, ‘What do people want that we can provide at a profit?” This means that you have to do the following: 

• Determine your guest’s needs and wants before doing anything else. 
• Determine the costs, prices, and profitability of products and services before starting to produce them. 
• Organize all aspects of the operation to provide what the guests want.

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Every successful restaurants engages in vigorous marketing, usually called the marketing mix, which is the combination of all the factors that go into creating, developing, and selling food and drinks. The “old school” way of talking about a restaurant’s marketing mix was the four “Ps”:

In today’s highly competitive restaurant and foodservice industry, we’ve adjusted the OLD way of thinking about marketing and have switched to something different, something that reflects the complexities and challenges restaurants now face. This new model is called the contemporary marketing mix, and it consists of three primary elements: 

• Product-service mix 
• Presentation mix 
• Communication mix 

Product-service Mix

The product-service mix consists of all of the food and services offered to guests. Makes sense, right? Restaurant and foodservice operations are thought of by the food and services they offer.

But the way they provide it – the service- is also a huge aspect of an operation’s marketing. Operations serving similar food products at similar prices will often need to enhance or change the way they serve their guests to stand out in the crowd.

If you are serving the same food and drinks as your competitor, you’ve got to have another angle – something about the way you SERVE your food and drinks that makes it unique.

Enhanced table-side service, delivery service, take-out service, curbside take-out and delivery services? All of these things factor into the product-service mix. 

Presentation Mix

The presentation mix consists of all the elements that make the operation LOOK and FEEL unique.

The layout of the operation, its size, the type of furniture it uses, the decorations, color scheme, lighting, and waiter/ staff uniforms… all these things contribute to the identity of the operation, the operation’s aesthetic, or the way it looks and feels to the guests. The choices that on operation makes with regard to how it actually presents itself to guests are critical factors in its marketing and branding strategy. 

Communication Mix

The communication mix includes all of the ways on operation actively tries to reach, or communicate with, its desired guests. An operation communicates with its guests using advertising, such as through television, radio, newspapers, flyers, or websites. But it also communicates with its guests through its menu, guest survey requests and other guest feedback requests, local community outreach, and Internet social networking sites. Employing  an effective communication mix is crucial to monitoring, maintaining, and improving an operation’s relationship with the market that it serves. 

These aspects of the contemporary marketing mix are constantly changing. An operation must continually evolve with the times. In order to do so, operations need to be aware of what is going on in the immediate community as well as the surrounding areas. 

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To understand how these things work together, it is helpful to use a company you probably know well and see how they have used the marketing mix to promote, protect and build their sales.

Let’s take a look at McDonald’s Marketing Mix.

Product-Service Mix

Obviously, McDonald’s has a product mix composed mainly of food and beverage products. McDonald’s product mix has the following main product lines:

Among its marketing campaign, products are fundamental to McDonald’s brand and corporate image. The company is primarily known for its burgers. However, the business gradually expanded its product mix to things like chicken and fish, desserts, and breakfast meals. This kind of diversification satisfies market demand and improves its revenues. In terms of risk, a more diverse product mix reduces the company’s dependence on just one or a few food service market segments and allows it to appeal to more parts of the population (people who don’t eat meat, – but will eat fish; people who are on a diet and want a salad; people who just want a decent cappuccino, etc).

COST

This element of the Product-service mix specifies the price points and price ranges of the company’s food and beverage products.

The aim is to use prices to maximize profit margins (how much you make when you sell a hamburger) and sales volume (how many burgers you sell).

McDonald’s uses a combination of the following pricing strategies:

1. Bundle pricing strategy
2. Psychological pricing strategy

In the bundle pricing strategy, McDonald’s offers meal sets and other product bundles for prices that are discounted, compared to purchasing each item separately. For example, customers can purchase a Happy Meal or an Extra Value Meal to optimize cost and product value. On the other hand, in psychological pricing, the company uses prices that appear more affordable, such as $__.99 for a meal instead of rounding it off to the nearest dollar. This pricing strategy encourages consumers to purchase the company’s food products based on perceived affordability. Thus, this element of McDonald’s marketing mix highlights the importance of bundle pricing and psychological pricing 

Presentation Mix

It may surprise you that HOW items are presented (interior & exterior design / employee uniforms/ packaging and plating) is so important. Read on. Restaurants have known for a LONG time that sometimes presentation is more important than what customers are actually eating.

UNIFORMS AND INTERIORS

How employees are dressed when guests arrive, how they are portrayed in advertisements… in general, how employees LOOK says a lot about how a restaurant. It DETERMINES how a particular hospitality business is seen by their market.

Cool, hip, trendy? Professional and serious? Casual? Formal? McDonald’s has tried many different styles of “look” for its employees and if you scan over the years, you can see how they have changed their presentation marketing to appeal to different segments of their market.

In the same way, you can see how McDonald’s has altered their presentation marketing platform by looking at exterior buildings and interior decorating over the years. At first, McDonald’s was a drive-in restaurant; no dining room, no place to eat inside. In the 70s and 80s it changed, diversifying and really pushing towards families with small children. Then it changed again, reframing its personality as a modern place that was “cool.”

INTERIORS

The interior changes, color schemes, and decorating ideas that evolved over the years matched how the exteriors changed.

McDonalds gradually evolved from a family hamburger joint to something more closely resembling a “3rd Space” – a home-away-from-home, where their market would feel welcome hanging out (not just having a quick lunch). Their current interior scheme seems nearly copy-and-pasted from Starbucks.

LOCATIONS

This element of the marketing mix is all about the venues or locations where products are offered and where customers can access them. Restaurants are the most prominent places where the company’s products are distributed. However, the fast-food business utilizes various places as part of its marketing mix. The main ways McDonald’s distributes its products are as follows:

1. Restaurants
2. Kiosks
3. McDonald’s mobile apps

McDonald’s restaurants are where the company generates most of its sales. They also own and operate kiosks at smaller venues (like airports, theme parks, sports arenas, and malls) where the entire menu is not available. The company also uses mobile apps, virtual places are where customers can access information about the company’s food products and buy these products. For example, the company’s mobile apps for iOS and Android let customers claim special deals, find restaurant locations, place orders, and pay for such orders involving participating McDonald’s restaurants.

Communication Mix

Here McDonald’s is focused on marketing communications with target customers. For example, the company provides new information to persuade consumers to purchase its new food products. McDonald’s uses the following tactics in its promotional mix, arranged according to significance in the business:

1. Advertising (most significant)
2. Sales promotions
3. Public relations
4. Direct marketing

Advertisements are the most notable among McDonald’s promotion tactics. The corporation uses TV, radio, print media, and online media for its advertisements. Sales promotions are also used to draw more customers to the company’s restaurants. For example, McDonald’s offers discount coupons and freebies for certain products and product bundles, as a way of attracting more consumers. In addition, the company’s public relations activities promote the fast-food business to the target market through goodwill and brand strengthening. For instance, the Ronald McDonald House Charities and the McDonald’s Global Best of Green environmental program support communities while boosting the value of the corporate brand.