Industry News | June 22, 2012 | QSR Exclusive Brief

Quick Serves Make a Play for New Neighbors

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When it comes to marketing, quick-serve companies have a host of demographics they try to get in front of: social media fanatics, Baby Boomers, Gen X-ers, Gen Y-ers, and even kids.

But some believe there is one segment they might be missing out on: new movers.

Now some companies are trying to help quick serves of all sizes and types connect with folks who are new in town—folks who could potentially become loyal customers.

Our Town America, a 40-year-old company that specializes in direct marketing to families who have recently relocated, aims to help businesses gain loyal customers before their competitors have a chance to access them.

“Business is tough, even in good times,” says Jack Kieffer, an Our Town America franchisee. “There are more and more competitors for every business, every year, and every month. To constantly gain new clients is a challenge.”

Instead of attempting to nab existing diners and sales away from competitors, quick serves who participate in new mover marketing can take first shot at the fresh pool of potential customers who enter a neighborhood or city every day.

To attract new customers, Our Town assembles a packet of gift certificates from participating clients (clients get exclusivity in their segment, so there won’t be a coupon for a Pizza Hut location in the same bundle as a Papa John’s offer, for example). The bundle is then sent out to new residents in a particular zip code.

Once the new resident receives and redeems a certificate, the participating business scans a unique barcode, which lets Our Town know that a particular customer has used the coupon. Oftentimes, Our Town will then follow up with a second certificate to thank them for coming in and to encourage repeat business, create familiarity, and instill loyalty.

In the last three years, more than 250,000 certificates have been distributed.

While the typical response rate varies from category to category and zip code to zip code, clients can expect return rates that range from 3 percent to double digits, says Marilyn Imparato, director of sales and marketing for Our Town America. For quick-serve clients, response rates upward of 30 percent aren’t unusual.

Kieffer says some pizza companies see response rates of up to 50 percent, while one of his clients experienced a 12 percent return in 2011 and was overjoyed.

Imparato notes, however, that “the strength of the offer is paramount,” adding that the certificate has to be a “goodwill gesture with no strings attached.” That means buy-one-get-one-free offers are a no go.

Tracy Tucker, a two-unit Subway franchisee who is an Our Town client, offers new residents a free six-inch sub and medium drink.

“Most people say they use quick-serve establishments for lunch when they’re on the go, and that type of an offer really works well,” Kieffer says.

Tucker says she gets a solid return on her offer because it’s an aggressive deal, noting that “it puts [customers] in my particular store a lot faster than it might have otherwise.”

Imparato points out that response rates for follow-up offerss are also contingent on how customers are treated on their first visit to the store. “Sponsors have to treat the customers like gold, because that influences whether they’ll come back or not,” she says.

Since stores don’t know which customers are new movers until they present their certificates at the register, Tucker says her employees have to constantly be on their A-game. “It starts at the top,” she says. “I have to have good managers in there to hire good people.”

While Kieffer acknowledges that social media and e-mail marketing tend to be the preferred advertising method for many businesses today, he says that, with these channels, brands must compete with others directly and that it can be tedious, time-consuming work.

Tucker says she enjoys new mover direct marketing over social media or e-mail marketing because it’s quicker and more personal. “Who doesn’t like to get a nice card in the mail from somebody?” she says. “This feels the same way. It doesn’t feel like junk mail at all. This is more personal and positive mail than people typically get.”

By Mary Avant