Expansion of a Restaurant Bar and Grill

Restaurant/Bar&Grill

Expanding a restaurant business requires a multifaceted marketing program. Three elements should be considered - public relations, pre-promotion and advertising. The objectives will be to generate interest in the new location(s). The idea of expanding the existing business rather than starting a new venture is to capitalize on the existing business' strengths. Internal strengths can be capitalized upon regardless of the name of the venture, so the key strength being capitalized upon by expansion is the brand identity. It is therefore crucial that this is woven throughout the expansion strategy.

The first aspect of the program is going to be public relations. This works in concert with paid advertising by providing publicity at a lower cost and higher credibility. It also helps to build buzz in advance of new location openings. Local media in the new markets should be alerted to the upcoming openings. Focus on differentiating the restaurant from the competition - what does your restaurant do better than others. Try to leverage opportunities to get key staff into the public eye - the executive chef onto a local cooking show or star bartender onto an entertainment show.

Upon opening each new location, throw a grand opening party for local media and dignitaries. Such a party should come in around $10,000 when food and staff costs are included. The direct payback will be minimal, but these are influencers, people whose recommendations can spur a lot of business throughout their entire circle of friends, family and acquaintances. If successful, there will be an initial boost in business that will then continue to trickle through the region as word of mouth spreads. It can be difficult to measure the impact of this strategy, but methods such as feedback forms or gentle questioning from front-of-house staff should be explored because you are developing a long-term expansion plan and want to ensure that this strategy is effective, since it can be costly.

The public relations part of the plan should have the longest time frame. As one restaurant PR firm puts it, "brands are best built with a long-term public relations plan, not a short-term advertising blitz." The shift towards becoming an expanding business requires such long-term strategies, whereas a single location restaurant typically does not.

The second aspect is going to be pre-promotion. If we assume that the new location is going to be situated within the same broad geographical area as the first one, the advertising program should start before opening, targeting existing customers. The goal is to develop some anticipation, and take advantage of the opportunity to generate word-of-mouth publicity in advance of opening. This type of advertising is inexpensive, because the target audience is already captive, at your restaurant. The menu should highlight the upcoming expansion, and signage within the restaurant should as well. Advertising in the washrooms should be included. The Yard House chain of beer bars uses this strategy as they expand. They focus on a handful of core geographic regions, so they are able to announce upcoming openings by announcing them first to existing customers in other parts of the same general region. The cost of this part of the program is low since you are providing the advertising space on premises. Only printing costs are incurred, so a few thousand dollars at most. The effectiveness will be in part determined by the proximity of the new location to the existing one.

Another element of pre-promotion is at the site of the new location. While this is under development, the opportunity should be taken to plaster the site with signage announcing your imminent arrival. In my neighborhood, a new coffee shop and steakhouse are opening soon and both have made sure to have large, visible signs in their windows to alert passersby. As the brand's reputation grows, this strategy increases in effectiveness, as evidenced by Krispy Kreme during their rise to prominence. With a highly developed brand, they were able to open new stores successfully relying on this strategy alone.