It's no secret inflation coupled with subsequent menu price increases are having a negative impact on restaurants. This is a result of consumer reaction and changes in their behavior. Consumer traffic is declining and guests are trading down, creating less expensive orders. The result: slowing industry sales.
There’s no silver bullet to remedy this situation. However, one way to blunt the negative impact of inflation and higher menu prices is through smart menu design. Specifically, in times like this, it is critical your menu strongly communicates value. A menu that clearly and compellingly explains value will help attract consumer interest in and attention to the quality of your menu items, and away from ordering by price.
The four key ways of communicating value with your menu design are as follows:
TURF Analysis. TURF, an acronym for Total Unduplicated Reach and Frequency, is a notable research instrument that provides two important types of consumer information:
The shortest lists of menu items needed to satisfy the vast majority of your customers.
The average number of items that each of your customers would find on that list that they might like to order.
By understanding this information, you can simplify your menu by deleting some of your less popular items. This can benefit your menu design by freeing up valuable real estate for your more popular menu items. Here again, is where TURF comes into play. It can determine which of your core menu items drive customer loyalty. Conversely, TURF can identify your menu items that have little consumer appeal and affinity. Knowing these will enable you to identify and rank your menu items that generate incremental consumer research and frequency of visits. This in turn can be used to communicate value with your menu design by focusing on your products customers have the most affinity for.
Price Value Analysis. This analysis will determine consumer attitudes toward the pricing of every item on your menu. It will identify the extent to which some of your items or categories of items are perceived to be overpriced, reasonably priced, or great values for the money. You can use this data strategically to emphasize or deemphasize menu items and specific categories.
As to menu design, your items that are considered great values for the money should be given more space on the menu and placed in the “hot spots” on the menu. Hot spots are where customers tend to look first and most frequently. To note, the hot spots are different on an interior menu than on a drive-thru menu.
“Signature” Items. Place emphasis on impactfully communicating your proprietary menu items. Consumers will be less price sensitive to your menu items that they can't get anywhere else. We’re talking Chick-fil-A’s original chicken sandwich, In-N-Out’s Double-Double cheeseburger, and Culver’s Concrete Mixers shakes.
Menu Recipes and Ingredients. These are another way to communicate value with your menu. Consumers view avocado, bacon, kale, aioli, etc. as premium quality ingredients that are worth paying extra for. Capitalize on consumer perceptions of these through impactful and appetizing visuals, copy and product descriptions, such as thick-cut maple cured bacon, hand-torn baby kale, and freshly made chipotle aioli.
Brand It. Integrating your brand positioning and identity into your menu design is another means of strengthening your communication of value. By integrating branding elements, customers will easily be able to differentiate your brand from your competitors. In addition, they will be able to see what makes your brand unique, thus heightening their overall experience.
In closing, while there’s no silver bullet for restaurants to totally overcome the negative impact of inflation and rising menu prices, there’s a “bronze” one that can blunt the effect of these inflationary times. It can be described in three words—value, value, and value.
Tom Cook is a Principal of King-Casey. Established in 1953, King-Casey is a restaurant and foodservice business improvement firm. King-Casey provides strategic menu optimization advice and a range of services to help clients manage overall food and beverage offerings affecting their positioning, reputation, and business growth.