Where’s the Value?
Consumers today define “value” much differently than just a few years ago. At one time, value related primarily to price. But as restaurants evolved and consumer expectations around food quality, service and the overall experience have increased, the dining out “value” parameters have also evolved.
Technomic has identified the new value equation as: value = (menu + experience)/price. Our Consumer Brand Metrics program, which analyzes consumer input on 55 restaurant attributes, finds that the attributes rated highest are food taste/flavor and pleasant/friendly service. Price is rated below those two attributes by each age group, however, the importance of food taste/flavor and friendly service increases with age. Value through low prices is most important to those in the 35-54 age group. Given that this is the demographic most likely to have families, mortgages, education costs and perhaps be caring for elderly family members, a higher level of price sensitivity is expected.
Source: Technomic, Inc., Consumer Restaurant Brand Metrics, 2011
How can this new value equation play out in a restaurant’s beverage program? The process actually goes to best practices in beverage management:
- Taste is, of course, a key component of any drink, and this requires strong, consistent operations. Ensuring quality, fresh ingredients are present in well-balanced cocktails and employing proper wine and beer storage, handling and pouring puts your bar program on the path of delivering on taste and flavor.
- The right glassware also adds to both the flavor delivery and the experience element of a drink program, not to mention value. Certain glass designs can present a generous pour while still keeping within pour parameters set for both responsible service and profit targets.
- The service element requires hiring the right people to work behind the bar and also serving drinks at the table, which means hiring those who have what I call the “hospitality gene.” Then, train them in basic knowledge of spirits, wine and beer products, as well as proper service of each.
- Evaluate pricing against competitors’ drink menus, and present strategic price promotions. These are programs that offer a good value to the patron via attractive products, experience and price elements.
Today’s “value”-seeking patrons are savvy customers. Get beyond price, and craft your drink program with an eye on the new value equation to make your bar a key component of the restaurant’s overall value proposition.