The Pizza Insider: May 2014

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Thursday, May 29, 2014

5 Reasons to Raise Your Prices Today

When was the last time you raised your prices? If it's been a while, what's stopping you? Look around. You'll notice that prices are going up everywhere on everything. Today is the day to raise your prices, and below are five reasons why.

Reason #1: You're Worth It. If you are pushing out a good product that customers cannot get from the guy down the street, your prices should reflect that. You will not lose as many customers as you're afraid you might, and if a few do disappear, they'll be replaced by those willing to pay for the quality you're providing.

Reason #2: Costs Continue to Rise. As I mentioned before, the cost of everything around you is rising, from gas, to produce (have you bought a lime lately?) to wages. If you don't raise your prices, you'll find it more and more difficult to pay for these everyday costs.

Reason #3: You Want to Grow. If you ever expect to grow your pizzeria and your staff, allowing for new offerings and possible expansion in the future, you'll need the capital to make it happen. A price increase can help to fund these dreams.

Reason #4: You Are Currently Undercharging. It's pretty safe to say that you're probably undercharging for some--if not most--of the items on your menu. Average food cost is usually around 31%. Is that your current average? Check out this handy guide to figure it out.

Reason #5: Customers Expect It. Believe it or not, with every business around you raising prices, your current customers almost expect to see your prices go up, especially if it's been a few years since the last increase. Just let those who question your decision know that raising prices is necessary in order to continue providing the quality of food and service they've come to expect. Not many people can argue with that.

Have you raised prices recently or thought about it? What has been the reaction, or what are your concerns? Let me know in the comments.

Thursday, May 22, 2014

Is Crowdfunding Right for You?

Starting and running a business requires a lot of capitol. Until a few years ago, you needed to get this money from banks, personal savings, friends and investors. Now, there's a little something called crowdfunding.

I was surprised to find dozens upon dozens of pizzerias that have taken to the Internet to ask for a helping hand--and it's no wonder. Billions of dollars have been raised through nearly 500 crowdfunding platforms over the past few years, with some of the most popular platforms being Kickstarter, Indiegogo, Fundable, Crowdfunder and Crowdrise.

I took a look on Kickstarter and searched for some successfully funded pizza projects to share with you here. I'm hoping it will serve as inspiration for those projects you've had on the back burner for a few months--or maybe even years. It may be hard to believe, but there are people out there who want to see you succeed, and are ready to back up their support with cold, hard cash!

Pizza Delicious in New Orleans - 282 backers helped raise $18,300 to buy them a new Marsal & Sons oven.

Atomic Pizza in Portland, OR - 171 backers helped raise $32,568 for them to move into a larger building.

Pizza Bonanza - I love this one! 160 backers helped raise $2,443 for a webseries that combines pizza making and pizza exercises. So fun!

Pizza Brain - You know this one; the pizza museum in Philly (check out my article in the upcoming June/July issue of PMQ if not). This is their Kickstarter campaign where 326 backers helped raise $16,587 to open the pizzeria.

Top This! A Pizza Flicking Game - OK, the board game world definitely needed this; a pizza game! 335 backers helped them raise $16,431 to make it a reality.

Are you getting inspired yet? Think you might be able to get some funding for that new patio, a cool T-shirt giveaway, new equipment? Check out some crowdfunding sites and see what others are doing. You could be on your way to crossing off your wish list by this time next month.

Thursday, May 15, 2014

Experimenting with Experiential Marketing

Have you ever heard the term "Experiential Marketing?" You may be doing it without even realizing it, and if you aren't, statistics show us that it's definitely worth trying.

Experiential Marketing is a term used for marketing that allows the consumer to interact with your business, creating a memory, and theoretically making them want to return to your restaurant.

For the full story on how it all works, as well as examples of how you can try Experiential Marketing in your pizzeria, I contacted Stevi McCoy, co-founder of Revel Experiences in Dallas, NYC and Boston, who says, "The most important part of experiential marketing is designing a solution that is personalized not only for the unique customer base, but also the unique brand. You want your brand to come to life in its own unique way and there are many creative ways to make this happen."

The Pizza Insider: What is experiential marketing and how does it differ from traditional marketing?

Stevi McCoy
Stevi McCoy: Experiential marketing is about engaging your customer through an emotional connection. We believe a successful experiential marketing program engages customers by creating impactful memories  vs. mere transactions. This powerful memory is shared – leading to brand advocacy and a desire to replicate the experience. This drives heightened referral and repeat business.

How can pizzerias benefit from using experiential marketing?

Many small to mid-sized pizzerias are competing with larger chains who frequently discount through large marketing budgets, inclusive of couponing programs. When done properly, an experiential program will help differentiate from a traditional marketing and coupon/discount program by introducing a unique, memorable and customized brand interaction. Interactive, experiential marketing engages at the sensory level and allows the brand to become top-of-mind. It conveys that your restaurant is interested in the customer at the individual level and not merely selling an inexpensive product. In fact, according to a new report on Experiential Marketing from CrossMark and MarketingWerks.

• 88 percent of shoppers say that if they enjoy an experiential interaction with a product they'll add it to their shopping list.
• Eighty percent said they prefer brands that "interact" with them over those that just "advertise" to them.
• Seven out of 10 shoppers say they'll share a positive brand experience.

How can experiential marketing successfully be implemented in a pizzeria?

The success of an experiential marketing program is based on a clear understanding of the behaviors, patterns, and profile of your current customer base, as well as of the ideal expanded customer base you would like to engage. Once you have gathered that data, you can then begin to build a program that is customized and personalized to your audience. The program you develop should be integrated with your entire operation and supported by all staff. There are affordable cloud based systems that enable this data and insight capture. A pizzeria is no different from any other restaurant, retailer or brand that is looking to develop a program to drive brand awareness, heightened engagement, and repeat business.

What is the cost/time difference between traditional and experiential marketing from a budgeting standpoint? 

There isn't a black and white answer to this question – pricing on any marketing program can vary depending on size/scope of the project. Before the launch of any campaign, however, you need to first identify a very specific intended ROI. This will not only help to clarify budget, but will also clearly measure the effectiveness of that campaign and identify areas that need to be improved upon for the subsequent program.

What is the possible ROI with experiential marketing? 

Experiential marketing campaigns can drive key engagement behaviors, leading to: increased brand advocacy and awareness, new customer acquisition, increased spend and customer retention.

Do you have any pizzeria examples you can share?

Experiential elements can enhance a pizzeria’s entire marketing strategy.  There are opportunities to build deeper connections with customers through communications, loyalty programs, special events, delivery experience, packaging, customer service, etc. The specific areas of the customer experience your pizzeria focuses on depends on your individual customer base and their unique needs. Below are a few ideas to try.

Experiential Marketing Examples
  • Build your own pizza – could be a regular feature or one-off event – would be a great family night concept
  • Regular or one-off events where a pizza chef gives a demo on pizza dough and lets the guests make their own
  • Surprise and delight campaigns (i.e., For regular delivery customers, delivering their “usual” order as a surprise gift, for dine-in customers, “complimentary drink or dessert” for returning customers)
  • Unique and creative loyalty program that is simple, easy to understand and allows for customization- could be based on spend, visits, referrals, etc
  • “Featured seasonal ingredient” of the week/month – promotes farm-to-table, great event concept, provides a marketing touchpoint for email or direct mail campaign
  • For pizzerias with BYOB or liquor licenses, partner with vendor for beer/wine tasting event
  • "Pizza and a movie” night event or, partner with Red Box or Netflix for a loyalty program that allows customers to earn dollars toward movie rental/subscriptions

Thursday, May 8, 2014

Succeeding with a Multigenerational Workforce

Over the past decade or so, we’ve seen a shift in the workforce as retirees stay on longer, and younger workers bring new skill sets to the table. Having three—and sometimes four—generations working together can often cause conflict. So how do you keep the peace while reaping the benefits that each group brings?

In order to answer these questions, I turned to HR speaker and author Lori Kleiman, who helps business owners solve these types of problems on a daily basis. “The first thing to realize is that multigenerational staffs are happening in the workplace today, and it’s not going away," says Kleiman. "In fact, it’s only going to increase.”

Lori Kleiman
Pizzerias, especially, are ideal locations for a multigenerational staff. “Pizzerias are attractive to both retirees and students,” says Kleiman. “Traditional retirees are leaving corporate jobs and looking for something to do; this is a great pool of talent for pizzerias to draw from. Additionally, younger workers bring skills in technology, social media and multitasking to the table.” Kleiman says there’s a lot that each generation can learn from one other, including technology, work ethic, and more. 

As with any staff, friction can develop between the generations. The key is to keep the lines of communication flowing, making it clear to all employees what is acceptable, and what is not (i.e., texting during meetings), according to Kleiman. Ultimately, staff members will learn to rely on each other and be more accepting of their coworkers. 

Since the beginning of time, coworkers have struggled to get along. A multigenerational workforce adds a new element to that equation, but one that should be embraced as an opportunity to strengthen your staff as well as your businesses.

Bonus Tip: With so many people—young and old—using social media, Kleiman says it’s more important than ever to have a written social media policy stating what staff members can and can’t post online about your business.

For more extensive information and statistics on multigenerational workforces, check out this in-depth paper written by Lee Hecht Harrison: Managing Today’s Multigenerational Workforce

Thursday, May 1, 2014

Are You Ready to Go Gluten Free?

Photo: Simply Gluten Free
The discovery of Celiac disease has changed the way many consumers dine out, impacting pizzerias in a big way. Over the past several years, many pizzeria operators have put great effort into offering something for new and existing Celiac sufferers, and their efforts have paid off with increased profits and dedicated customers.

For the latest statistics on Celiac disease and how gluten-free menu items have grown over the past few years, I turned to Carol Kicinski, a gluten-free cookbook author, TV chef, and editor-in-chief of Simply Gluten Free magazine.

The Pizza Insider: What are some of the latest statistics on how many people are affected by Celiac disease?

Carol Kicinski
Photo: Simply Gluten Free

Carol Kicinski: It's estimated that 1 in 133 Americans have Celiac disease – that is about 1% of the population. Unfortunately about 83% percent of those people have yet to be diagnosed.  The estimates for number of people who have gluten sensitivity varies widely depending on which study one looks at, but conservative estimates are at about 7% of Americans.

How have gluten-free options in restaurants grown over the past five years? One year?

Five years ago it was almost unheard of to be offered a gluten free menu at a restaurant. In the last 5 years this has grown considerably; many big chains such as PF Chang's and California Pizza Kitchen now have many gluten free offerings. I have seen a dramatic increase in the last year.

What are the pros and cons of pizzerias offering gluten free items on their menu?

The pros for pizzerias are many. When a couple that has one partner with gluten sensitivity, they are going to eat where the person with gluten sensitivity can safely eat. When a family goes out to eat, they will eat where the person with the sensitivities can eat and the same goes for when the baseball team goes out. So the pizzeria with the gluten free offerings will get not just the gluten free person in their restaurant, but all the people that may be dining with them. The cons are that in order to safely serve gluten free pizza in an establishment that serves pizza made with wheat, certain protocols must be in place. It's more work, but in my opinion, worth it.

For the diner, the pros are being able to go to an establishment and order pizza! The cons are, unless one is fully aware of the safety protocols, one can never be certain they won’t get ill from cross-contamination.

If a pizzeria wanted to incorporate gluten-free items, what's the best first step toward doing so?

I would say the first step is to determine how to safely keep food from getting cross-contaminated. To establish separate work areas and protocols. I know that many places get pre-made gluten free pizza crusts and cook them on parchment and have separate toppings which won’t be contaminated.  The tricky part is if the establishment makes their own dough on site to keep the flour from getting everywhere and contaminating the gluten free area. I know of a local place that uses rice flour to roll out all their pizza crusts, gluten free or not; this keeps the flour out of the kitchen as their doughs are made elsewhere.

What do you foresee as the impact of gluten-free menu items in the future?

There is a good and bad side. Some place will “jump on the bandwagon” to attract the gluten free customer without really having proper safety protocols in place. For the establishments that are truly committed to providing a safe gluten free menu, the impact will be very positive. The gluten free community is a very vocal and loyal community. They will spread the word of great restaurants with gluten free offerings and frequent them often. I know that I personally tend to go back to the same places over and over again if they have great food that I can safely eat. We also love knowledgeable wait staff! It is such a pleasure to go to a restaurant and have the wait staff be able to recommend dishes to me that they know are safe if they don’t have an official gluten free menu.