Limited Time Offers

By: Andrew Coppolino

You can hear the clichés ringing out with loud frequency: the reason for our success is, "Location, location, location!" Or, "Come on down and buy now: this is a limited time offer!"

However, when you really sit down and think about it—and get past the piercing hawkers’ cries—location does have a lot to do with success. And limited time offers can in fact work for your restaurant when you consider them carefully.

As is the case with any loyalty programs that a business might extend to its customers, a limited time offer (LTO) can keep restaurant patrons interested in what your kitchen and dining room is doing—and keep them coming back, limits or not, time after time.

And of course, the smart restaurateur can select certain time periods during which to use LTOs strategically , such as slower periods of the day, week, month, season, or year.

First, though, let’s remember in its most basic essence what a unique opportunity a restaurant offers to be able to make a sale. Jose Riesco, a former restaurateur and now a U.S. restaurant consultant, makes a simple but incisive comment about the business through his website myrestaurantmarketing.com.

"As a restaurateur, you have a really big advantage over many other businesses," says Riesco. "When a person walks in your door and sits at your table, you’ve pretty much made the sale unless your service is so slow or your staff screws up so badly that your customers leave your place without paying.

"Very few other industries can claim this advantage. Many businesses spend thousands of dollars in marketing campaigns just to bring people to their stores or websites without any guarantee that they will spend any money on their goods or services."

He firmly believes in LTOs and coupons and such marketing collateral as a way of driving more traffic through your restaurant doors.

"You can collect the coupons that your visitors bring to your place and instantly know exactly how many people visited because of the coupon offer. This allows you to measure if your investment in a coupon program is worth it," he points out.

"In some cases, I’ve had hundreds of new customers and made a nice little profit, even after offering a 15% discount through a coupon."

Taking advantage of this special quality that restaurants possess, you can simply clear out inventory, test drive new menu concepts and ideas, but also enhance or re-vitalize existing menu items, according to Andre Butler, a Flanagan Foodservice district sales manager.

"Make sure your use of limited time offers does not become a pressure sell which could take away the benefit of the offer to both you and your customers. But absolutely, LTOs can help enhance the attraction of current menu items at the same time as being used to introduce new items."

Butler suggests, however, careful thought in what you draw to customers’ attention, and uses an automobile sales analogy: a car dealer may not feature their top selling vehicle but rather choose to highlight a new or lesser known model.

At the same time, no matter how you choose to set up a coupon program, make sure you know what you have offered and be able to track it. A coupon suddenly showing up that you’re not prepared for, or one that has too much fine print that negates its value, can work against your reputation, according to Butler.

It’s also wise, he says, not to forget how important kids can be as a driver to getting adults and families out to restaurants, especially restaurants for whom the perception is that dining with children can be difficult and expensive. An LTO can help mitigate that.

"Appealing to kids can be a real hook for parents when it’s the right kind of restaurant."

Add in to the mix regular LTO "wing nights" for certain types of restaurants and that can build a solid customer base. If the deal is exciting enough and targets the right diner, word-of-mouth can further build loyalty to your brand.

Both Butler and Riesco suggest that restaurants take advantage of seasonality. For instance: get your customers to recognize that it’s king crab time and buying one meal gets them a second for half price—while it lasts. It points out to people that a particular food item is only around for a limited time and you want to help them take advantage of that.

Holidays and other seasonal periods, which might in some cases be slower for business, might dictate the best time for an LTO: cool stuff in summer; warm stuff for the coldest parts of winter, for example.

"I’ve seen some successful cross-marketing with limited time offers as well," says Butler. "The restaurant offers to its guests a coupon for a discount at a specific clothing store, and vice versa. That can generate sales you otherwise may not get."

It has to be strategic, however, in that the customer using the restaurant is a likely demographic to shop at the specific store and the other way around.

"And if you think there are problems with your LTO program, it may not be the coupon offer itself but the potential customers that you’ve targeted," warns Riesco.

Butler would agree that giving careful consideration to your target audience is ultimately the key.

"Think about where you are putting your limited time offer: average-income suburbia? That may be the right choice for you, of course, but it’s something you have to think about in relation to who your customers are and the limited time offer you want them to use."