Market Segmentation / Supervision

OK, OK, I'm bad -- I kind of dozed off during a lot of today's class. The subject matter was actually pretty interesting, it's just that I've been burning both ends of the candle, at one end is helping manage a soon-to-be-opened restaurant, the other end is a wife in the 3rd term with our first child. So here is what I can recall...it's all a bit of a dream...

We shot out of the gate with analysing a case study of market segmentation for a fictional restaurant named the Juicy Rib. Based on census data and in house polls, we extrapolated what age groups we were doing well in, which were underrepresented, and based on projections who we'd want to focus on to stay profitable in the future. By looking at a year of sales of what menu items sold the most and least at what times, overlaid by the nearby sources of customers, told a lot about what could be done to increase sales, what didn't need pushing, etc.

The second part of the class was dedicated to outlining some major theories of management. Scientific Management is breaking it down into rigid structures, demanding obedience to the machine, and generally juicing the worker out of every cent of productivity. Hello, McDonalds and most fast food! Boring drones, they.

Human Relations Theory says that you make the worker happy, you get them to produce. Hello, Google! Hello, Microsoft!

Participative Management has the worker participate in designing the systems that they will use to complete their tasks, which usually gives the worker more interest and satisfaction (and more productivity) in their job. The manager who solicits advice from their workers AND actually acts on it, hello!

Richard described Humanistic Management as a melange, particularly in a restaurant. In the kitchen, a fascistic Scientific method might be best, but if the servers are going to be the first line on the ground giving feedback on what the customers want and say, a participative method might be more effective. Because you don't want the line cook giving his own funk to the chef's dishes, and you don't want a server acting like a robot!

I haven't done the readings, haven't had time, but hopefully this weekend I'll have time and expound here on the juicier details.

Marketing / Supervision

We started the day with a rambling odds n' ends. Slovak Ricky Martin went to Perry Street, loved it, and didn't really say anything too enlightening other than impressing on us that he must have real hi-falutin' taste. Based on the pizza restaurant menu layout the class developed, Guy brought our suggestions to his graphic designer, to which the designer got offended and acted really defensive. In Guy's own words, the guy is a serious guinea (ginny?) and is old school. As a designer myself, I suspect the guy's skill set is out of date and his defensiveness means he should have been fired a long time ago. I told the class about the poster I saw in the window of a Burger King (above) for apple fries -- fresh apples cut and packaged to look like french fries, with caramel served in a packet like ketchup. Basically, the least healthy way of serving apples possible. On one hand, cool, they're selling fresh fruit to kids. On the other hand: they're training them to associate french fries with health. It's like trying to make healthy food look like porn food to make it appealing, when really what makes it healthy should be enough. Like sex -- does sex need to be porno sex to be appealing? Come on!

Next we reviewed a marketing case study of a fictional restaurant called the 'Juicy Rib' (ewww!) The place is trying to figure out the best way to roll out new products, but need to know demographics to determine what it should be: cheap? expensive? lunch? dinner? eat in? take out? beefy? veggie? butchie? girlie? By using data sets from the census and in-store polls of current customers, the details of income, age and living area kind of filtered into a logic that answers the questions. Wednesday we'll pick this apart farther.

Richard gave out an outline for a basic restaurant business plan, and reviewed it. It wasn't that big, and we have a whole 4 months to complete it...fictionally if desired....and still some students were twittering like it's so much work. Jeez, people, you don't have to work very hard to write your plan, but don't expect any investor to give over funds to pay for your half-assedness.

We closed out class with a short case study out of our supervision text. A shmoe at a restaurant is a hard line worker for a few years, gets promoted to manager, is determined to be a nice guy, unlike the hard-ass nit-picker who was the previous manager, and promptly becomes hated and steamrolled by his fellow employees who once were his friends. Why? Well, management should have promoted him to a a place where he wasn't working with his ex-equals, they should have given the employees a heads up, Shmoe should have thought more of being effective and less about being nice and, in my opinion, if moving him to another department wasn't an option, they should have given him a salary raise without a promotion. And Shmoe should have quit and gotten a management job somewhere else. Like, say, me!

In the News/Marketing Case Study

We kicked off with whats in the news. Its a bit aggravating because Richard asked a table to choose someone to lead the conversation -- public speaking and selling yourself and your ideas are part of the curriculum. But these students are so spineless and wishy washy, they can't choose someone so they all go up, 4 people timidly present one little article then the one comfortable person dominates for the rest of the exercise. If one of these scaredy cats were actually go by themselves, maybe they'd get the experience to be more comfortable! Anyway...

In Britain, dietitians are attacking poor old Nigela Lawson for not giving a flying f@ck about limiting fat at the expense of flavor. Judging for the picture above featured in the article, I'd say Nige is a bit pudgy and I'm quite all right with that!

The Times had a cool article on Cashew Chicken, the Chinese fast food staple that was invented by a Chinese cook in Missouri about 50 years ago, and it has gone on to become a signature dish of a whole region near the Ozarks. Weird.

The NY Post features some bon mots from a doctor touting the benefits of drinking alcohol. Can I get a "what-what?!" Can I get a "who da hat?!" With all the bad press booze has gotten since the beginning of time, there must be SOMETHING good about it to cause people to still drink it year after year.

The next part of the class was a video about three people opening a restaurant, an owner, a chef and a manager all with debt up to their eyeballs. They all have different visions, the are don't really communicate, the budget goes from $300k to $1.2 milly, and when the date to open arrives, they have no seating, an untrained staff, and no parking for a large suburban location. WTF? And yet, some how, they are successful. These videos only seem to show restaurants that thrive despite all the retarded mistakes they make, not because of them. Hmmm.

Next up, Richard ran through a marketing plan for a restaurant he consulted for, from SWOT analysis to analysis. We received a new text on supervision, which will be a new topic starting on Monday.

Marketing

The day started with odds n' ends, which is supposed to be idle discussion of our recent experiences in restaurants, though some of the less swift students still pull out newspaper clippings during this time -- are they so broke that they don't hit up restaurants?

Dave got some veal picatta the other day and in the first bite got a mouthful of cardboard stuck to the bottom of the meat. Patrick went to Ciprianni's with a friend and was shocked by the bad service, the crappy food and the $400 bill...for lunch. Richard spoke of a local restaurant (on the UWS) he hit up with a friend, a homey Latin joint. They noticed people in the restaurant drinking beer...out of paper bags. He also noticed a sign saying they were under new management. It seems when a restaurant changes ownership, they must reapply for a liquor license. When Richard asked if they served beer, the server gave a conspiratorial wink and delivered bottles in paper bags to the table. It seems that if a cop were to pass the restaurant, he could bust them if he saw booze being served...but if he only sees paper bags, he'd have to get a warrant to come in and search the bags for alcoholic content.

We chatted a bit about the annoying ServSafe exam we took on Monday (spelling errors! vague questions! unexpectedly easy!) then moved into more nitty gritty on marketing.

Marketing is all about finding and taking advantage of trends, as opposed to fads. Fads are a quirk, a spoke that comes on quick, rises and falls in a blink. Trends slowly build, sustain, and slowly fade away. Dance music is a trend. The Lambada is a fad. Trends and fads are results of consumer behavior.

We reviewed several models of consumer behavior. In quick succession, there is the Marshallian Economic Model: consumers are rational, as price decreases sales will rise, as the competitions prices fall, your prices will fall, and as you advertise more, your sales will rise. This doesn't always work -- if wagyu beef was listed at $9 for 30 oz, something would be very suspicious. People buy stuff like obscenely expensive watches simply because they are expensive. Fact is if you devalue your core product, consumers won't be willing to pay more for it in the future.

The Pavlovian Learning Model states that behavior is learned. Drives are strong internal stimuli, cues are weaker stimuli from within and the environment. A response is a reaction and reinforcement is positive or negative influence on the response.

Veblomian Sociopsychological Model states the social environment is all important. Trendy restaurants in the meat packing district are not places to eat good food so much as places to be seen.

The Howard-Sheth model of Buyer Behavior accounts for a large number of inputs and outputs, too many to recount here. The Nicosia Model states that the message given out by an institution contrasts with consumer predisposition to create certain results. For example, McDonalds took the name of a perfectly ordinary breed of cow and gave it's name to a burger - the Angus Beef McWhatever was the same old same old, but the message hit on a predisposition to think it meant something more.

The last hour of the class was dedicated to running through the seven steps for putting together a marketing plan.

• Situation Analysis: where you are right now. SWOT - strengths, weaknesses, opportunities, threats. Who is the market? How is the competitor's product perceived?
• Goals: General statement of hoped for results from marketing.
• Objective: Measurable statement to help determine how much should be spent on marketing.
• Strategies: how to reach the objective, specific techniques. Four base strategies: aim for target markets or new markets, focus on core products or develop new products.
• Tactics: Action Plan. Down and dirty, the precise actions
• Budget: Based on tactics, in line with objectives.
• Evaluation: Can be built into tactics. That's why some shops ask for your zip code -- to see if their advertising in a certain area makes a difference.

ServSafe

We did a short 'In the News' before rolling into an extended lesson from the ServSafe text -- we're taking the national test on Monday. It seems because the French are so concerned about alcoholism and drunk driving, not only has their consumption dropped from the #1 spot in the world (that now goes to the booze-loving Brits), but their rate of heart disease has skyrocketed. I thought the French were supposed to hate Americans, so why are they acting like us?

According to a blurb in Restaurant News, our culinary school's main competitor is cutting tuition on select programs by thousands of dollars. Richard noted that in tough economic times, c-schools usually do extraordinarily well, but because of the credit crisis, people are having an extraordinary time getting the loans and money required to attend.

Starbucks is in crisis mode -- the niche of "good quality but expensive" was a great place to be in the go-go 90s, but today they have eliminated decaff and now have started selling packets of instant coffee to take home. Sanka, anyone?

To close out was a trio of McDonalds stories. Anyone with an internet connection already knows all about the Crazy Nugget Lady, who called 911 three times when the McDonalds she was at ran out of the McNuggets she ordered. When the cops arrived, they McArrested her dim-bulb butt.

Then theres this shmuck who ordered employees to eat 2 day old McDonalds burgers after scolding them for not appreciating how lucky they were to have a job.

Finally, a poor shlub working at the Golden Arches sees a dude delivering a smack down on a lady, escorts dude outside, and gets shot 3 times for his trouble. After months in the hospital and 300 large in bills, McDonalds rejects his workman's comp claim. Classy!

The first story was handled well, with the company apologizing for the crazy lady, giving her a full refund and free meal. The second was neutral, with them releasing a statement about how McD's should always be eaten immediately. The third, however, was a huge opportunity to celebrate a low-rung worker, get much more than $300,000 in free advertising and turn a tragedy into a feel-good branding opportunity. Instead, they just look like an evil corporate empire. Which they are. F@ckers.

The rest of the class was dedicated to rote lecturing about cleanliness and safe habits in a commercial kitchen. Monday will be dedicated to this, so I'll resume blogging on Wednesday. Until them, mi amigos, stay classy!

Marketing Overview / ServSafe

Steve ran the class again while Richard covered wine in the other section of management. First part of the class was dedicated to talking about culinary news. The peanut plants that were run out of business recently because of salmonella issues were, believe it or not, organic. Being "organic" is not a measure of cleanliness, it seems. It points to a problem in the system -- it is the companies wishing to be certified organic who pay for the inspection and certification. It is in the interest of payer and payee to certify every one under the sun regardless of quality or cleanliness. The USDA organic green and white logo is a bit of a fraud.

ServSafe was a laugh riot as usual -- Monday we're taking the test and then this will be done. To recap quickly, food flow safety -- keep the cold cold and the hot hot. Thaw in the fridge, not the counter top. On a buffet, a sneeze guard must be 14" or more above the food and 7" or more extending in front of the food. Fascinating stuff.

The second half of the class was dedicated to a PowerPoint presentation all about marketing. Bottom line is passion -- someone somewhere when creating the concept must have a passion for the product. From there, marketing can focus on finding new customers, getting current customers to come back, and getting current customers to spend more. The first part is where the big expenses come in.

The "Four Walls" theory of marketing is this: If you can successfully pull off four products within the four walls of your restaurant, it's guaranteed to succeed. The four products are food, service, ambiance and sizzle, aka hook & pizzaz. Which sounds a lot like pizza to me.

Marketing is all about studying the moments of truth: initial contact, whether by the web or phone. The greeting at the door, the view from the floor. There is definitely not a shortage of things that a well-paid restaurant consultant couldn't pull apart in detail.

International Food Show

Today was no class work, but a trip to the Jacob Javitz Center on the west side of Manhattan for the Food Show. It was the biggest snow storm of the year, so most of the class didn't make it, nor did most other attendees. Some booths remained unstaffed, notably our friends from last week's field trip, the Hunts Point Fish Market. Baldor, however, had a huge booth cranking out hot samples to taste.

I focused on all things pizza, and found some notably gross products spread out through the convention. One group was selling an "encruster" machine. Basically anything that can be frozen can be surround in dough to be baked. Simply, a machine that pumps out hot-pockets. Another were all about super thin pre-baked pizza crusts which tasted basically like tortilla wraps, made a little crisp. Someone came up with this and bet money on it? Damn. There was a baking supply outlet with some nice pizza peels and decorative pizza pans, and a company that sold all sorts of gas-burning pizza ovens.


There was a pizza pavilion which was quite underwhelming, sponsored by a pizza trade magazine. A flour distributor, a company that gives away free pizza boxes with ads all over them, a purveyor of pizza-centric food supplies, a company pushing a remarkably cheesy (no pun intended) franchise out of friggin' Buffalo, NY. I mean, really? Maybe I'm a snob, but NYC seems to be overwhelmed with slice joints, many of which are great, many more which are whatevs. The angle that should be being pushed is pizza sophistication, not more cheap sloppy garbage pie-style stuff.

There was an exciting list of talks and events listed for the day, but the bad weather pushed everything back and I never got to see the USA Pizza Team do dough acrobatics on latex pizza skins and watch Dom DeMarco of DiFara's get awarded a life-time achievement award. Oh well.

And if your playing a drinking game while reading this, here ya go: pizza. Pizza pizza pizza.