¶ Simplifying Marketing for Bar Owners
If marketing feels complicated , it's not . It's literally just interested in three questions what's the product , who is it for and how do you reach them . That's it . I've simplified it further recently . I was given a talk two weeks ago . I said , really , marketing comes down to two things Getting people to raise their hands and getting people to follow you .
Here's a great example . You walk into a busy room and say , hey , listen , let me see a show of hands . Who likes tacos ? And a bunch of people raise their hands . You say , perfect , everybody just raised their hands , follow me and you take them outside to your food truck . You take them across the street to your taco place .
In essence , everything we do is interested in those things is trying to figure out who needs or who wants what you have and then finding a way to get them to follow you to go get what you have . So marketing is really , really simple what's the product , who is it for , how do we reach them ? Getting people to raise their hands and follow you .
Hello and welcome to the Bar Business Podcast , where we help bar owners increase profits , attract loyal guests and simplify operations so you can avoid burnout and finally enjoy your life outside of your bar . I'm your host , chris Schneider , the Bar Business Coach .
Before we get started , a quick thank you to our sponsors , spot On , who provide a great modern POS solution for the bar and restaurant industry , and Starfish , who use AI to turn your books into actual steps to increase profits .
Today we are joined by Chip Close , and Chip is probably someone that many of you are aware of If you're not , I'm not quite sure how because he is a frequent industry speaker .
He is the host of the Restaurant Strategy Podcast , he has a coaching program through his P3 Mastermind program and he is the author of the Restaurant Marketing Mindset , which is part of what we're going to be discussing today . So before we get in and have Chip talk , I just want to say one quick note .
His podcast was one of the first industry podcasts I interacted with and actually really grew as a podcaster but also as somebody in the industry to enjoy the stuff he's putting out , and if you have not listened to his podcast , I suggest you do , going back the first episode of his I heard was about a lemonade stand , which if you ever want to hear a story
about someone doing a lemonade stand with their kid and then turning it into a masterclass on essentially restaurant profitability , that is a cool episode to go check out . So with that , chip , thank you for being here . Hopefully that did some justice to your background , but go ahead and fill in anything that we didn't hit on that .
No , I appreciate it . It's a great plug . I appreciate it . I'm glad to be here .
Well , super glad to have you . And before we get into the book , which is where we want to spend most of our time today , there is something that I hear you say from time to time .
That is something that I've said essentially , but , contrary to what 90% , I would say , of our peers in the podcasting and coaching space say , which is , revenue does not cure all sins . It tends to cover them up , and that is not , like I said . To me it's not a revolutionary statement .
For a lot of people it is , but why don't you break down a little bit what that means ?
Yeah , and let's dig in there a little bit , yeah , so you hear this all the time where people are like well , I mean you know , I mean you know revenue cures all sins , right , I just need to pound that register . And it's funny , Before we hit record , we , we were talking about
¶ Navigating Challenges in Bar Profitability
this , right ? I went back to business school during the pandemic and I had at that point , 20 some years of operational experience in the industry and it was still elusive . I didn't understand why our business was so hard and I went to business school largely to find the answer to that , which I did .
But I met a guy early in my first year , somebody else in my cohort , who worked at the Campbell Soup Company . So I went to St Joe's , I got my MBA in . I went to St Joe's , I got my MBA in food marketing . St Joe's is based in Philadelphia .
The Campbell Soup Company is right across the river in Camden , so a lot of very smart , capable , ambitious people work there and they have an incredible program where they basically reimburse you for your education . So it's in your best interest to go get your advanced degree .
And then even we were talking and I said I just don't understand like we should be more profitable . Ours is a huge industry . We feed tons of people . Food culture in America has never been bigger than it is right now . And he said it's really easy . It's because of the three moving targets . And I was like what do you mean , the three moving targets ?
He's like well , listen , let me explain . Campbell's Soup we have salespeople who go out and sell cans of soup months and months and months ahead of time . A quarter or two ahead of time they've sold to all the grocery chains , all the retailers , the CVSs , everybody .
So by the time we get to the month when we have to start production , sales are not a question mark . We know how many cans we've sold , so then we can staff appropriately . So we know how long we're going to have to run the line for and how many people it's going to take to run the assembly line . And we then know cost of goods sold .
It's not a question mark . We just order as much product as we need to fill the cans that have been ordered . So revenue is not a question . Cogs are not a question . Labor is not a question . He's like for you guys . It's the exact opposite .
You have no idea how many people are going to come in on a given Thursday night and how much each of them are going to spend .
You have an idea based on historical data , but I don't know it could rain and screw it all up , he's like , because you don't know how many people are going to come in or what they're going to order or how much they're going to order . You don't know how to place your orders . Order too much , you've got waste . Not enough , you've got 86s .
And then with labor , you think you're going to be busy on Thursday night , see staff up , but again it could rain and maybe you're totally overstaffed then screwing your profitability , he's like . So you got the three moving targets that we don't have . It's not a question how much we're going to sell . We've already sold it .
Therefore , it's not a question how much we have to order . We know how many . You know . We know how much to order to fulfill those orders and then we know how many people to staff . That's the biggest challenge for our industry . So revenue does not cure all sins Goes back . Revenue does not cure all sins goes back .
It's a long way of getting back to there . Right , cogs and labor , otherwise known as prime cost , right , those two things together .
Those are our controllables and in business we succeed when we can properly control our controllables and most restaurants and probably most bars don't properly know how to manage those and when you put guardrails on your business so you don't over order , so that you don't properly know how to manage those , and when you put guardrails on your business so you don't
over-order , so that you don't over-schedule , then you get your business profitable . Once you have a profitable business , right ? So if I say , hey , you know how to make 5% , so 5 cents on every dollar , right , Isn't it better to get it to where we're making 15 , 20 , 25 cents on every dollar ?
Once I figured that out , then I want to pump more money in the top of the machine because I know more out the bottom . So for me , revenue does not cure all sins , it often covers them up . And if we can right-size our staffing , right-size our ordering , get it really profitable at current business levels , well then we can grow .
The other piece to it is that if you're telling me revenue cures all sins , you're telling me the only way we can make a profit here is by pounding the register , then what do you do in a natural macroeconomic slowdown , a recession ? What do you do like we're going through right now ? What do you do when you're going through an election year ?
Guess what happens . Every four years we have a presidential election . Guess what happens every four years .
¶ Maximizing Restaurant Profitability and Efficiency
The economy pulls back ever so slightly . If you know , so many restaurants are down anywhere between 10 and 20% . That's a meaningful number . And if you mean to tell me that we're only profitable when we pound the register full tilt , well then , what do we do when , naturally , there's a pullback ? I mean we can't be profitable .
I just , I fundamentally reject that .
We , to your point , talked about this before we hit record .
But it is so refreshing from my end because sometimes it feels like there aren't very many people out there saying , yeah , more revenue is great , right , more revenue almost always leads to more on the bottom line , but it doesn't really mean you're improving your costs and everything in between the top line and the bottom line .
And you know one thing that occurred to me as you were talking there's a huge focus always on prime cost right , because that is our biggest controllable . It's right there .
And I think a lot of the counter argument to the position that both you and I have would be well , if you cut labor and you're just going to screw yourself over and get into trouble , which I know from my end is a simple well , yeah , if you do it wrong , right .
Like , there are strategic ways to take care of your costs and non-strategic ways to take care of your costs .
So if I work with a restaurant , let me just interrupt real quick and this happens all the time , right , I've worked in fine dining at a very high level . Quick , and this happens all the time , right , I've worked in fine dining at a very high level . The number of chefs I've talked to I'm like , at this revenue level , this is what you can spend on labor .
And they look at the number and they say , well , I can't do this menu on that labor . And I say , great , then deliver me a menu that can be done on this labor .
Because we've looked back at 24 months and I know you're pretty much always in this pocket At this labor and often what they tell me I said at this labor , if you want to hit a 30% labor cost , let's say you've got to be doing 50 , 60% more revenue than what you're doing now . Number one is that even realistic ?
Can we do that and how long will it take us to get there ? That doesn't just happen overnight . It's like , yeah , of course , let's increase our revenue by 50% . You have to manage that .
And I'm not saying do more with less , I'm not saying do your current restaurant with less people , but I'm saying well , then you've got to make decisions about what gets prepped and what gets purchased . You've got to make decisions about what goes on the menu how many people can you staff on the line , what's getting picked up off of what station ?
All of those make decisions you can make . You don't have to just do things the way you've done things . And , ps , our industry is wildly different today than it was 5 , 10 , 20 , 50 years ago , so to continue to operate in the same manner is just foolish .
Couldn't agree more . And , as you were talking , it reminded me I think it was an episode that came out recently with Jon Taffer where you guys got a little bit in the weeds on compression of . You know , if your menu is too big to the point you just made , if your menu is too large , take stuff out . Force the business to work to make you money .
Don't force the money in a way that it can't be forced .
It's just to run a business and to not acknowledge the realities of where things are at right now . There are more restaurants than ever before , and we'll get into this as we start talking about the book . There are more restaurants now than have ever been before . There are more good restaurants than there have ever been before .
Labor is up , cost of goods is up , rent is up . You can't run the restaurant like it's 1985 . It's not , so let's not pretend it is . That is a great statement .
Because , you know , act like it's not 1985 . I swear , half our industry still thinks it's 1985 . So I am right there with you that things have changed and we got to adjust .
A hundred percent . Now the good news , the reason we have more restaurants , and the more , the reason we have more good restaurants is because there's more interest , there's more excitement in our industry . People are demanding better quality . They're willing to pay for higher quality . Again , in 1985 , you know how many vodkas were on the back bar ? I don't know .
Two , two , three maybe . And now how many premium ? How many premium called spirits can you name Right Before you even get down to the stuff ? So Absolute Sky and Pop-Off was on the back bar in 1985 . Now most restaurants don't even carry those , or certainly most nice restaurants , and they're not even the top five as far as market leadership .
We've got Grey Goose , we've got Kettle One , we've got Tito's , we've got Belvedere , we've got Chopin . I mean on and on and on . Sky , absolute pop , like no way . And that's a good thing . Right Back in 1985 , there was Jose Cuervo , that was tequila , and now look at all the great stuff we have .
You know it just keeps getting better and that's a good thing . There's money to be made there , both on the manufacturers , on the distributors and on the restaurants and bars .
Well for sure , and I think you know the more availability of product , whether we're talking in the kitchen and you know obvious , huge changes in what's available food-wise or behind the bar , liquor-wise .
It just means we can innovate more right , it means we can have more fun and , to kind of tie that back to our cost conversation , it means that you have more options to adjust your cost points .
We have always had options , and now it's just easier to see them . Now there's just no excuse .
Absolutely so . Let's just easier to see them Now . There's just no excuse . Absolutely so let's turn over to your book . So if you guys have not bought it or heard of it or read it , it is the Restaurant Marketing Mindset , which I think is a great book because it's one of the .
It's a quick read , it's not too difficult to get through , it's not dense in any way , but there is a whole lot packed into a very small number of pages . And one of the things I really like about it , Chip , is you go from talking about marketing and it is more or less about marketing , but so much of it gets into operations as well .
It's the marketing and how that influences your operations and how then you can use that to drive growth 100% .
They're indelibly connected , and so the first part of the book .
The book has four parts and we're just going to talk through the first part today , which is the A , b , c , d and E of marketing , because I think these are in the book . They're called the foundation . I think it's a wonderful foundation that everybody needs to have in their head for understanding how to market a bar or restaurant
¶ Defining Your Target Audience in Marketing
. Yeah , first of all , before we get started , I want to give you the opportunity to find marketing , because I feel like that's something we throw out a lot but not everybody is clear on what we mean .
Yeah , so I wrote this book for everybody who says I don't really do marketing , we don't really need to do marketing , we don't have the money to do marketing . If you sell something to other human beings , you have to market because you have to think of .
If you sell something to other human beings , you have to market because you have to think of , well , what human beings need what I have . How do I convince these human beings to come get what I have , as opposed to any of the other options out there ? So marketing , it's really funny . So in the book I define it as these three questions , right ?
So much of what I try to do is simplify really complicated stuff . And if marketing feels complicated , it's not . It's literally just interested in three questions what's the product , who is it for and how do you reach them . That's it . I've simplified it further Recently . I was given a talk two weeks ago .
I said really , marketing comes down to two things getting people to raise their hands and getting people to follow you . Here's a great example . You walk into a busy room and say , hey , listen , let me see a show of hands . Who likes tacos ? And a bunch of people raise their hands .
You say , perfect , everybody just raised their hands , follow me and you take them outside to your food truck , you take them across the street to your taco place . In essence , everything we do is interested in those things .
It's trying to figure out who needs or who wants what you have and then finding a way to get them to follow you to go get what you have . So marketing is really really simple what's the product , who is it for ? How do we reach them ? Getting people to raise their hands and follow you , whatever you do to market right , marketing is not .
You know , social media is not marketing . Email's not marketing . Marketing is not . Social media is not marketing . Email is not marketing . Seo is not marketing . Your website's not marketing . Text messaging none of that's marketing . Those are tools available to the marketer , and I started off the book with these ABCDs of marketing .
And you're right , abcd leads to E , because this foundational work that so many restaurants miss and it's why so many restaurants fail Absolutely .
And I hope people listen to that and then take time to reflect on , because there's a whole bunch of truth smashed in a few words Now A , b , c , d , e . So we start with A audience , then we go to B , brand , c , competition , d , differentiation and E everything . So let's start right with A audience .
So I think one of the things that people have a very hard time in our industry doing is defining what their audience is , because they go well , I'm in a town , it's everybody , and clearly that is not true . So what can bar owners do to start to define their audience ?
So I do this all the time , right , I ask people who their restaurant is for , who's your restaurant for , and they say everyone , which is totally false . What they mean is I think everybody who comes in here will have a great time , like , I think we can take care , I think we're capable of taking care of them , and that's right .
At the end of the day , though , it's not for everyone . There are people who won't like what you have , who can't afford what you have , can't get to you , right , and all that's fine , you figure out . I say I wrote this in the book figure out who your product is for by first figuring out who it's not for , right .
So if I get a steakhouse , it's not for vegetarians , right . If I get a sports bar , it's not for people who want like a quiet , romantic meal . It's not . It's for people who like loud environments , who like burgers and wings , craft beer , want to watch the game . It's loud , it's noisy , there's music . That's who it's for , right .
If I made a romantic restaurant , it's not for guys' night out , it's not right . If I made a salad shop , it's not for an anniversary dinner . People aren't going to come celebrate their anniversary over . You know , sweet green , they're not probably Audience , right ? The first the A in the ABC is about figuring out who your product is for .
It's about figuring out who has a problem that you're uniquely qualified to solve . And what happens is now that now we're talking about product market fit and we're talking about understanding who needs to be served . There's no reason to come to market and put out something that already exists . It's just a , it's a waste , right ?
People are like , oh well , why should ? Because the first question is you know , I go in there and say , hey , I just opened a steakhouse , right , you should come to my steakhouse . And somebody goes well , why I got that steakhouse that I love ? I got the other steakhouse that my father-in-law loves . I got this up like why should I come to your steakhouse ?
In essence , you have to answer that question for them . That's what we all do . You have to say , well , because fill in the blank and you need to understand which we'll get to . That's where the ABCD really leads to . But understand that nobody needs to be served . They're already being served .
They're great restaurants , great breakfast spots , great lunch spots , great bars , great romantic restaurants . Most markets already have those out there . So if you're going to come to market and compete for that business . You better understand why you deserve to be there . And you begin by saying people have nice restaurants , but they're all pretty expensive .
So I'm going to come in and create something maybe just a touch cheaper , right ? So instead of $100 a head , I want to create something that's $60 a head , right ? So instead of $100 a head , I want to create something that's $60 a head .
So it's not the $30 a head like Applebee's Outback , you know whatever , but it's not $100 a head like the French place down the street , I think this upscale , casual new American $60 . It's a great place to celebrate , but it's not going to break the bank . Okay , you can convince me if you feel like your market is missing .
That Next step is then ask people if they figure out if that's actually what they would pay for . That's how you begin to figure out if there's an opening , if there's a gap in the market , and that's really what A is interested in . It's really about understanding your audience . Who is it you're going to serve ?
Now something else with audience that you mentioned in the book and that I think sometimes a lot of folks in our industry forget . You have demographics and you have psychographics and , at least in my experience , it seems increasingly .
You know demographics are age , sex , race , kind of just basic descriptors of human beings , Psychographics being obviously much more about how we think and I feel more and more like we're relying too much on demographics and not a lot on psychographics , because not all the groups are different .
Right , I mean there are millennials that act like baby boomers , there are all sorts of crossover between demographic groups , but psychographic groups , at least in my mind , become a little bit easier to define and a little bit easier to market to .
Well , they're all tools . In the book I lay out this idea of segmentation , right , which is that population is everyone in the given market .
And if we say , hey , we can't afford to market to everybody which is true , we can't , and it's not useful to because again there's people who can't afford us , people who won't like what we serve , people who can't conveniently get to us , well then already we've made some decisions about who we're not going to market to .
But when we segment the audience , when we segment a population , we can do it demographically , like you said age , race , gender , sort of income , education level , things like that . And psychographics for anybody listening , who's never heard of that before , because it was news to me before about I don't know , eight , nine years ago .
But psychographics gets into the mind of the consumer , right , Like what do they believe , what do they fear , what do they want , what do they not want , what do they hate ? Right , and in the book I use this example of like , okay , I'm going to open this upscale sports bar in a college town like Ann Arbor .
Okay , so I go to Ann Arbor and I open this thing and it's gonna be upscale , right , so we can either choose to make a sports bar for the kids serve $2 pints of Bud Light , or an upscale sports bar which will have $11 cans of Kraft Vermont IPA , I say , okay , well , I'm going to do that upscale one , really cater to the haves , not the have-nots the
haves . So the faculty , the parents , the boosters , the alumni , all of that . But just because people have the money to spend on an $11 can of craft IPA doesn't mean they'll do it . My dad's a perfect example . He'll spend money on nice wine . He won't spend money on nice beer . He won't spend money on nice bourbon , right ?
Likewise , there are people who would spend money on beer but don't like no , don't like wine . So you have to find people who believe what you believe , right ? That , like , we're in the golden age of craft beer in this country and it should be celebrated and it costs extra and that's good .
And we've got to find people who believe that , who believe what we believe , and that gets to the psychograph .
So , moving past A to B , we have brand and one of the things that you wrote on brand and you kind of already have hit on this a few times in different ways , but it's possibly one of my favorite sentences in this part of the book it just says good is no longer good enough , and so a lot of brands get kind of thrown together and aren't really good enough
. So , in your mind , what is that differentiator for a brand between good and actually good enough or great in a way that you can make an impact on the market ? Yeah , I don't know .
I mean largely markets sort of decide for them . The key to brand is not necessarily determination of quality but of a solution , right ? So if A is audience , you're figuring out who has a problem that needs to be solved . B is the solution to that problem , right ?
Like you say , hey , I think you need a nice place to celebrate your anniversary that's also not going to break the bank .
It doesn't look like you have a lot of those options here and I'm going to solve that problem for you , because sometimes you want to mark the occasion you want to celebrate , but you don't want to break the bank because you have kids and college to pay for and things like that . For me , it's not good food , good service , cool decor . That's table stakes .
Again , too many good restaurants . Too many restaurants out there . Too many good restaurants . Really , what we have to be doing is making sure we understand the problem and we are properly solving it . We're responding the way it should be responding
¶ Building Brands and Understanding Competition
.
Now with brand , because I know a lot of folks spend a lot of time on brand and they there's a lot of opinions on how brands should be done . Branding , I feel like it's one of those kind of nebulous business things that hangs over everybody's head and no one quite feels like they ever have it right and all of it . I think to your earlier point .
It's almost easier to explain on this one where you're wrong versus where you're right . So what are the brand mistakes you see people make that just kind of knock the wind out of you a little bit .
A logo is not a brand . That's the first one . The number of people that begin with a menu so the number of people that open a restaurant and start with a menu and end with a logo they're dead Brand is the sum of all the interactions that a consumer has with that entity . So the logo is part of it , the menu is part of it .
The lighting , the music , the steps of service , the interactions with the managers , with the website , with your all of that all of these touch points , right , have to be carefully curated .
And when you look at some of the best brands out there , when you look at Nike or Apple or Nikon or BMW , or again any of these iconic brands that have a really firm brand identity , it really is . So we'll use Apple because Apple's .
You know there's so many examples here , but like looking at an Apple device , holding , touching feeling , an Apple device Opening the Apple box Perfect example . They create that vacuum feel . If anybody's ever opened an iPhone , that's not accidental .
It was a team of people that were employed back in 2005 , 2006 , and 2007 , whose job it was was to work on that so that it felt like you were taking the seal off . Nobody ever created a box that had that vacuum feel to it and it's still there . Every time you open up an iPhone , you get that feel .
That was not accidental and somebody thought that deeply about the product . That says , man , the unboxing of an iPhone is religious for some people Think about it being your first one or your new one or whatever right .
So when you think of the experience in an Apple store which , ps , they didn't have Apple stores 30 years ago , 40 years ago that's a relatively new phenomenon . So they thought really deeply about okay , what should an Apple store be like ? There are more things to put your hands on than any other retail store short of like a Best Buy .
Right , you can touch so many different devices in there , there are so many hands on deck to help you and answer your questions , and all that that wasn't accidental .
They lose money on those stores but for the brand identity for that's the consumer facing and the really tactile part of their brand they knew how crucial it was going to be towards getting new people on board . Like all of that stuff right From the commercials you see the logo , you see touching the products , opening the products , going to view the products .
All of that is carefully , carefully manufactured , carefully carefully manufactured . It's an example , or several examples , of a great brand operating at a very high level , thinking really deeply about their customer experience . That's what we need . That's what all restaurants need , whether we like it or not .
It has to be unique and identifiable and it has to speak to the problem we're solving Absolutely .
Moving on to C , competition , you have throughout the book these little boxes that say I believe it's mind shift , change or mindset shift . There we go , and for competition you put in that box . Competition always does two important things . First , it validates your idea . Second , it gives you a category .
So break that down for us a little bit , because on one hand , okay , it's validates your idea . Second , it gives you a category . So break that down for us a little bit , because on one hand , okay , it's validating your idea . On the other hand , you're also saying there that you're really not defining your own category .
The market's defining you based upon what's already there .
Guess what ? In the year 2024 , there are no new categories right ? Are no new categories right ? Or very , very few that require billions of dollars of investment to create a category ?
Right , if you want to create a category of people who will take you to Mars and , yeah , that category doesn't exist yet but I think we'd agree it's billions or trillions of dollars to develop that . There are no new markets . If you enter a market , you have competitors .
So the way I like to put it here is when we bang them all together , right , a audience who has a problem that you're uniquely qualified to solve . B is brand . How are you the solution to their problem ? C , competition , it's who's trying to solve the same problem you are .
What happens when you look around and you say I'm going to use this example of the nice restaurant right , there are a couple of nice restaurants in this town . It's pretty much a hundred dollars a head , and I think that I can create an alternative that would be at a lower price point but still nice , nice enough where people would want to celebrate there .
Well then , you're in a consideration set . So , number one it validates your idea that , hey , I think people want to celebrate their anniversaries and birthdays somewhere nice . Those other people who opened similar restaurants . They also found the same thing . They assessed the market and came to the same conclusion that I did , and that's incredibly satisfying to know .
Hey , I'm not crazy , I saw this opportunity . Those other people also saw this opportunity . We're all trying to serve the same people , right ? The category , then , is this idea of the consideration set right , a restaurant is not competing against all the other restaurants . A bar is not competing against all the other bars .
If you want to go to a speakeasy , it's upscale . You want to get dressed up nice , it's sort of a good date night or whatever that is . That's a specific thing . You're then not thinking about the Irish pub or the wine bar . You're thinking of this speakeasy , that's what you're in the mood for , that's what you want .
So you're competing just against other speakeasies . Likewise , if you just want an Irish pub loud , energetic , lots of Guinness flowing well then a quiet , elegant speakeasy isn't going to fulfill that need . I want to go somewhere where I can drink beer , play darts , you know , listen to music . That's a different thing .
So when you come up with a category , you're then on a short list , at least in the eyes of the consumer . Perfect example when I say hey . Say to my wife hey , I really don't want to cook tonight , I'm just exhausted , let's just go out for something . She goes well , what are you in the mood for ? We say I don't know how about sushi ?
She goes sushi sounds great . Well , now we're not considering Chinese or Greek or Mexican or pizza or sushi , and we're looking at other sushi restaurants . Okay , of the four or five sushi restaurants that are within a 10 minute drive , 15 minute drive , we're going to pick one of those . So that's what a category does it gets you top of mind .
Your job , at least at this point , is to get yourself on that list of four or five options in the eyes of the consumer .
So one thing with competition and this is not directly in your book but as you were talking , this popped into my head as something that is interesting to me about our industry and a lot of times I feel like with competitors there's a lot of , for whatever reason .
In this industry we're kind of adverse to each other and it's so funny going from the restaurant bar ownership side to the consultant side the consultants , the podcasters we all get along great , generally speaking . I found people are really open .
We talk to each other but as a bar owner , if you try to get another bar owner to work with you , a lot of that's hitting heads . A do you have any clue why we don't work together more closely with our competition ? And B is there anything that you have in your head that can help solve that ?
So I love this . I think it's a really great conversation . I'm glad we're having it . I talk a lot about how there's a relationship between competition and collaboration . Perfect example why do all these car dealerships put themselves right next to each other ? That's weird , right ? They're all in direct competition . Somebody's going to go get a new truck , right ?
Why would I want to be around other places that have other trucks ? Like I want to ? Because when people are shopping for a new car , they want the idea that they can go look at a bunch of different brands , that they can go test drive a bunch of different . Whether that's the reality or not , that's the impression on the consumer .
Same thing with food right , that a lot of restaurants end up going near each other . That's what brings people down there . Hey , let's just go downtown and we'll find somewhere to eat . Right , let's go to Restaurant Row , let's go to . Same thing we go to towns . We go to food towns .
Right , san Francisco is a great food town because there are lots of great restaurants there . So if you're going to open a restaurant , you want to be around other great restaurants , because then people will come into town because there are a lot of great restaurants . There is a relationship . Listen , I run a mastermind program .
I've got 155 people in the program , spread across four groups . There's something really powerful that happens when you get a bunch of like-minded people going through the same thing , when you get them all together .
Now I work across the entire country , but there's no reason that in your market you can't have your own mastermind group where you're trading ideas and stories . There is a collaboration , there is a relationship . I was talking to a one of my members , one of the members of my group .
She runs a you know , a small craft brewery in Boise , idaho , and she was like I feel like I'm getting like there's just all this competition , like people are going here , and I said no , there's not . This is the Napa wine train . Somewhere along the way , all the Napa wineries said you know what ?
We should put together a shuttle or a bus or a train , which is what they have in Napa , and they can go from one to the other , to the other , other to the other . People don't want to go to one winery , they want to go to multiple wineries and taste a whole bunch of different things . Same thing with beer .
Put together a beer event right where it's like you get a punch card , you pay 20 bucks and you get a beer at eight different places , or nine different places . People will go from one to the other , to the other , to the other . They will support the local taxis and shuttles because they're not going to drive themselves that .
Eight beers over the course of a day and there's a collaboration there . Yeah , are you competing against other breweries ? Sort of . But you can lean into the collaborative part of it and it makes all the difference .
I couldn't agree more . I think there are a lot of us on the consulting , coaching side of things that are really trying to breathe more collaboration into our industry , and it could just be that everyone , to your earlier point , is stuck in 1985 . But it's so nice when we have the opportunity to push that and try to bring people more together .
Now , moving on through our A , b , c , d , we get to D , which is differentiation , and so one thing I thought was interesting about this you say differentiation , and then the whole chapter talks about storytelling , which obviously storytelling is the way to differentiate . But how is the best way to tell a story ? How can you make stories impactful ?
How can you be different ? How can you differentiate through the storytelling process ?
How do you make a decision
¶ Creating Restaurant Differentiation for Success
? You like sushi Great . How do you make a decision what sushi place you go to ? When you say hey , I'm in the mood for sushi . Where do you want to go ? How ?
do you make that decision ? Pick one . Depends on who you're with . Depends on where .
Sure , you just kind of pick one , right ? You go to the one that has the spicy tuna roll yeah , but they all have spicy tuna , right ? You go to the ones that have the spider roll or the rainbow roll or the yellowtail scallion roll I'm naming . Every sushi restaurant on the planet has all of these things , right ? So how do you make your determination ?
This is the biggest problem with our industry right now is we have six . I have six sushi restaurants within 15 minutes of me and I can't tell the difference between them , right , like I just they're all the same , they're all the same . Differentiation is about . So , again , let's bang through these ABCDs A audience who has a problem you can solve .
B brand your brand , your experience , your service , your restaurant is the solution to someone's problem . C competition you figure out who else is trying to solve the same problem . You are competition . You figure out who else is trying to solve the same problem you are . Gives you a category , you're on a short list .
D differentiation is figuring out how you separate yourselves from that , right ? So if I say let's go out for sushi dinner , I say , well , okay , where do you want to go ? Well , there's this , this , this , this , this . I named five options . How do we make the determination ? Maybe ? Well , this place is cheap , remember that other place is sort of expensive .
Let Remember that other place is sort of expensive . Let's go to the cheap one , right ? Well , this one's the closest , let's just go there . Sometimes we just want to save money or we just don't have much time . We want to go to that right . Now we start getting into the commodity what I call the commodity mindset right ?
All things being equal , consumer will make their decision based on one of three criteria when you're dealing with a commodity . They based it on familiarity , convenience or price . No independent operator can succeed , can compete . If you're trying to be the most well-known , the closest or the cheapest , you'll die . So we got to come up with some other reason .
How do we convince people to go out of their way to spend a little bit more than they otherwise would have ? The way you do that is by figuring out what you have that no one else in the world has . Guess what If I say , yeah , I have a sushi place , right , it's my sushi place . I'm the only , this is the only sushi restaurant I own . That's a story .
Who am I ? Why do I open the sushi place . Why does it matter ? What do I do ? That's different than all the other places , right ? I'll use a high-end example of this . So in New York City we've got all these omakase counters right .
So for anybody who doesn't know , an omakase sushi restaurant is a counter and it's usually anywhere between 12 and 17 pieces of fish in succession . They're usually very expensive , anywhere between , let's say , $500 a head , and you sit down and they give you one piece of fish at a time .
So now in New York City that was sort of a novelty 15 years ago , but now it's very much a commodity . There are tons of them and they're all expensive . And New York is a city where there's a lot of money flowing so people can afford that kind of stuff .
My favorite of the bunch and I've been to a handful of them , my favorite is a place called Shuko . Shuko is like a speakeasy . It's an unmarked door on 12th Street , right in the heart of the village . There's , I want to say , 16 seats at the counter . You walk in . It's exposed brick , it's dark . So it's not bright , white , clean , silent , it's gritty .
It's got exposed brick , it's dark . It's got these early 2000s hip hop playing . So you'll hear Jay-Z , you'll hear Diddy . You'll hear like there's . That's the vibe , that's their differentiator .
Now , I'm sure there's a differentiation in the food and the techniques they use and all of that , but the real differentiator is the energy in there , the kind of vibe you want . If you want stoic , clean , silent , precious , that's not , that's not it .
When we differentiate ourselves , we have to say hey , we're an Omikase counter , just like those other five or eight or 10 options , except ours is dark and gritty and loud and energetic , and that's the buy . So if you want this experience but you don't want all the pretense of it , totally cool , we get it . We don't either .
So we created a place for people who wanted this . Is this for everyone ? No , but for a certain subset of people . And with 16 seats to the counter , they got to do two seatings a night . Convince 32 people a night to have this experience , they're fine . That's what you have to do .
You have to figure out how you separate yourself from the others in the category . The best way to separate yourself is by figuring out . I ask in the book what are the stories ?
Only you can tell what's unique about you , about this place , about your version of pizza , about your version of Italian food or tacos or a commodity , and you're going to be making three , four , 5% margins simply because you are convenient to a small set of people .
But when you're differentiated , when you're unique , then you get people going out of their way for you . So they're not going there just because you're down the street , they're going out of their way . They're driving 20 minutes , 30 minutes , they're getting on a plane and going across the country .
That's the difference between a restaurant that subsists and a restaurant that thrives .
Wonderful . Now that would bring us to E , but we are running short on time . E is easy , so what up E is easy A , b , c , d leads to E .
E stands for everything . You can choose to either be overwhelmed or empowered by this fact .
Everything you do , every choice you make from the name , the logo , the signage , the door , the lighting , the food , the prices you charge for the food , the way you plate the food , the way you serve the food , the way you talk about the food everything matters because it communicates something to the people you're trying to attract .
So , again , you can be overwhelmed by the fact that there's no decision that can get thrown away , or you can be empowered by the fact that you have lots of chances . You have lots of opportunities to tell that story and to convince someone to choose you over any of the other options out there .
That was quick and easy . Another thing I will say buy Chip's book , because we only went through the first section and there are all sorts of other questions that I would have for him . If we had more time and if we had a five-hour podcast , we could fill them all in there , but particularly in his book .
Just one thing to point out he gets into internal versus external marketing , which I think is an amazing conversation . So definitely go get the book and check that out . But because we are running low on time right now , is there anything else that we haven't talked about ?
Anything you want to add , anything that you think is of value to the listeners that we haven't touched on ?
Just want to give some context to everything we just spoke about . That is the foundation . I said this a few minutes ago . That's the foundational piece that so many restaurants are missing . They don't understand who they're serving and actually what problem they're solving . They can't articulate why they need to exist . There is a reason you exist . You know it .
Your job is to make sure that everyone else knows it , and our job as marketers whether you consider yourself a marketer or not , you have to convince people to choose you over and over and over again , so you have to do that foundational work . What happens is , again social media is not marketing . Email's not marketing . A website . Seo is not marketing .
Those are tools available to the marketer . Everything , though , hinges on that foundational piece . You have to understand why you exist , why you need to exist and who would miss you if you were gone . That's a powerful idea that , if you could just take a step back and say , okay , now this might just hone what you already have .
It might force you to pivot or change altogether , but I think you might find that . I think this is why we're struggling . I think this is why we're struggling . I think this is why we can't find an audience right .
If you can't find people to come and come back over and over again , there just might not be a need for what you have , but I bet you there's a need for something else that you are very well equipped to provide . So just want to be able to , just want to make sure to highlight that Sure Now .
I'm sure a lot of people have been listening to this and they're thinking , hey , chip's a pretty cool guy . I want to get in contact with him . How can people get in touch with you ?
Yeah , Okay . So the best way , number one is to go check out the podcast . We're up to episode 380 . It's been going on five and a half years . It's an incredible . It's like a trove of knowledge . It's an incredible asset . I try to keep it really tactical , really actionable , every single episode . They're incredible , incredible interviews .
The Lemonade Stand episode is definitely worth listening to . My two other favorites number one episode 331 . It's an interview with Kevin Boehm . Kevin is one of the co-founders of Boca Restaurant Group out in Chicago . He is incredibly generous and so transparent . I couldn't believe the stuff that he was sharing .
He just locked down all of the things I already believe . Episode 331 . And then , more recently , I did an interview with Jon Taffer , who , Jon and his people , reached out to me , which is like mind-blowing .
Like he asked if he could be on the show and he shared things that I've never heard him share anywhere else and that's really incredible to hear the way he thinks about the industry and the way that he thought about his own restaurants that he opened , most recently Taffer's Tavern . That's really worth listening .
So you can go check out the podcast Restaurant Strategy . Start simply , taffer's Tavern . That's really worth listening . So you can go check out the podcast Restaurant Strategy . Start with those episodes , for sure . And then if you find me on Instagram at Restaurant Strategy , you can get the book for free . So we've almost sold out the first printing of the book .
We're in the process of getting the second printing . It's probably on a boat somewhere right now . We have , like as of the other night , like 82 copies left , so we're giving them away . If you go to our Instagram page at restaurant strategy and you DM us the word book B-O-O-K , you can get the book for free .
You just have to pay for shipping , which is like $3.92 . It's available to anybody in the United States and it also comes with a free month of our foundations community . So it's online course , a resource bundle , all of that . If you want to stay with it , it becomes $97 a month after that , which is still an incredible , um , an incredible asset .
But even if you just cancel at the end of the first month , totally cool , go in there and get all the swipe files , get all the download . It's literally absolutely free . And the online content is meant to be really a compliment to the ideas and the insights that I share in the book .
So you can go get the book for free , get a free month of that online community . So do that again at Restaurant Strategy and DM us the word book B-O-O-K .
Well , we will put that and a link to the Instagram , a link to the podcast and a link to your website all in the show notes . So if you're listening , just scroll down . We'll make it real easy for you to click over to Chip's Instagram and send him that DM . But that , chip . Thank you so much for being here .
I really appreciate your time and sharing all the insights this afternoon .
Thanks for having me . I appreciate it .
That about wraps it up for today . If you enjoyed today's insights , make sure you like , subscribe and leave a review . If you are ready to take your bar to the next level , schedule a strategy session with me by clicking the link in the show notes below . Until next time , have a great day and we will talk again later .