Nation's Restaurant News - January 5, 2009

A LEBHAR-FRIEDMAN^®PUBLICATION

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EDITORIAL
EDITOR: ELLEN KOTEFF

EXECU TIVE EDITOR/ENTERPRISE REPORTS: Robin Lee Allen

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MANAGING EDITOR/DESK OPERATIONS: Christi Ravneberg
DEPUTY MANAGING EDITOR: Paul Frumkin
EXECU TIVE FOOD EDI TOR: Pamela Parseghian
EXECUTIVE FINANCIAL EDITOR: Sarah E. Lockyer

ON-SI TE EDI TOR: Elissa Elan
HUMAN RESOURCES EDI TOR: Dina Berta

FOOD EDITOR: Bret Thorn
SENIOR DESK EDITOR: Mark Brandau

DESK EDITORS: Elizabeth Licata, Michael Dempsey

CONTRIBUTING EDITORS: John Barone, Stephen Beaumont,
Gary Bensky, Richard Berman, Amy Garber, Mary Ewing-
Mulligan, Florence Fabricant, Foster Frable, Fern Glazer,
Malcolm Knapp, Louise Kramer, Nancy Kruse, Ed McCarthy,
Caroline Perkins, Julie Ritzer Ross, James Scarpa,
Jim Sullivan

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30328. Fax: 404-843-0751

NE W ENGLAND/NE W YORK/MID-ATLANTIC: Chris McCoy
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644-3255. Lydia Mayer (office manager) 444 N.
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Fax 312-644-3256

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ARIZONA/CALIFORNIA/COLORADO/IDAHO/NEVADA/ NE W MEXICO/OREGON/UTAH/WASHING TON:

Rebecca Roberts (regional sales and marketing manager).
606 N. Larchmont Blvd., Los Angeles, Calif. 90004.
323-860-6321. Fax 323-465-4287

FOODSERVICE MART/CLASSIFIED

ADVERTISING SALES: Leslie Wolowitz (manager).
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Fax 212-756-5289

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Neil Hochman, Inside Sales Manager, 425 Park Ave.,
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FOUNDER (1900-1981): ARNOLD D. FRIEDMAN

Professional, proactive approach

key to capturing events business

BY JONATHAN MORSE

The usual pop from holiday parties proved more of a fizzle in 2008, capping a year that was hardly a blockbuster for restaurant group bookings. The reasons were obvious: Corporate customers scaled back, cancelled or skipped their annual functions as economic conditions worsened. What’s a restaurateur to do in an environment like that?

Certainly not throw up his or her hands in surrender, as many did. Sure, the economy worked against the trade, but the situation underscores the notion that restaurants have to stop regarding functions as found business and start managing that revenue stream like any other key contributor to the bottom line.

Operators need to become more professional in how they develop such a crucial part of the sales mix. It has to be handled as a business unto itself, not merely an extension of the dining room.

It’s something the hotel industry realized as it emerged from a severe downturn in the late 1980s, when a development binge left too many properties to fill. Sound familiar?

The pressure on restaurants to hold down costs was even more intense then than it is today on restaurants. But by embracing technology, the hotel industry made a quantum leap in selling group business. Today, that side of the hospitality industry is easily 15 years ahead of restaurants, a point supported by recent research.

Coyle Hospitality Group, a mystery-shopper firm, called 50 hotels and 50 restaurants in five major cities to gauge their professionalism in selling meetings. The callers pretended to be shopping for a function room for a small- to medium-sized group. Each place was rated on a score of 100 on four criteria: professionalism, prospecting, rapport building, and advancing the sale.

Restaurants got their butts kicked, with a score of 59 to hotels’ 72.

But the results suggest that hotels don’t have the groups market locked up, either. Of all 100 places contacted, only 19 asked the caller if he or she wanted to see the space, and 36 didn’t even return the phone call within 24 hours.

Clearly, there’s ample opportunity for restaurants to increase their group bookings, even in this environment.

For many, that means dropping a passive approach. Too few places analyze the market and go after the business that’s there. Even with companies booking fewer banquets or dinner meetings in 2008, aggressive places found a way to land their share.

Their success came in part from knowing the usual sources of their business. What challenges do your corporate customers face in justifying a group function, and how can you position your place to be part of the solution?

The Plaza Hotel in New York City, for instance, touted its Grand Ballroom as an elegant place for companies to hold year-end parties without eating the high cost of a private room. Companies were invited to treat their employees to a posh lunch in one of the city’s most storied spaces for just $150 a head or $1,200 for a 10-person table, all-inclusive. The twist was that each company used that one room in a communal setting.

Davio’s, a four-restaurant operation based in the Boston area, might not have the staff of a Plaza Hotel, but it is having positive results from cross-selling function space across three restaurants, using sim-ple-to-run software to coordinate and manage the effort. The Davio’s in downtown Boston is a landmark, but fans who work in the city may not be aware there’s another Davio’s in Foxborough, perhaps even closer to their homes. Similarly, business customers might not realize they could book a sales dinner at a sister downtown restaurant, Avila, instead of taking a chance with an event in an unfamiliar operation. Technology is helping the company capture more business from current customers.

Those operations have the advantage of knowing who their function customers are and what kinds of events they book. Many restaurants can’t say the same. If they were asked to list their Top 10 meetings and events customers, most would have to leaf through their banquet notebooks.

They have a paper record, not an interactive database that can be mined for marketing and sales opportunities. How can they reach out to customers and help them work within their budgets if they don’t know who they are, what they spend, or what kind of events they prefer? The events-management software to do it is available today at a nominal cost. We’re so confident it can make a difference that we offer a free trial of our system.

Sure, times are tough. But there’s no reason to give up on meetings business. All it takes is a change in attitude; the technology is available to provide the know-how and means.