Chapter 10 Chapter 09 The Nature of the Industry in Catering Advertising

Highlights of this chapter: Under the influence of the "lipstick effect", consumers will choose products with high cost performance.This chapter will take restaurants as an example to continue discussing the concept of value for money.The cost performance of restaurants is different from that of general consumer goods. For restaurants, it is easier to understand the difference in taste, environment and service, but it is more difficult to understand how to pursue the essence of the industry.Restaurants also need to convey the spirit of the essence of the consumer goods industry to consumers through advertising.

Why do you go to fancy restaurants to eat?Is it because of the environment, taste and service? It's completely wrong, if you only value these three points, then you should go to the small shop in front of your house to eat beef noodles. What is the charm of a top-notch restaurant that can maintain such a high level of customer satisfaction with such a low price/performance ratio? It is this gap that you can't understand that brings you into a high-end restaurant. According to the survey results of the China Chain Store and Franchise Association (see Figure 9-1), under the impact of the financial tsunami, from the perspective of catering types, Western-style restaurants are the most affected, followed by distinctive exotic cuisine, and then Coffee drinks and Chinese restaurant.Low-priced, branded retail food is the least affected, and high-priced items are the most affected. This is the lipstick phenomenon we talked about in the previous two chapters.From a regional point of view, regardless of the type of catering, South China is the most affected, followed by Central China/East China.This is related to the type of regional economic development. The southeastern coastal areas are dominated by export-oriented economic development and are most affected by the international financial crisis, while the central and western regions are relatively less affected.

Yang Liu, executive vice president of the China Cuisine Association, pointed out that the impact of the financial crisis on the catering industry in 2009 was very obvious. From January to March 2009, the retail sales of accommodation and catering industries increased by 18.9%, which was about 4 percentage points lower than the same period in 2008. The drop is obvious.This has both seasonal factors and the impact of the financial crisis.On the whole, in 2009, the incremental demand of China's catering industry declined, and the growth rate slowed down.According to statistics, the turnover of some high-end restaurants has dropped by 10% to 40%; while the mid-range restaurants that focus on white-collar consumption are also declining due to the reduction in the income of the target group, the passenger flow and per capita consumption are both declining, and the turnover is down by 10% to 20%. %.

From January to May, the catering industry in Beijing increased by 13.3%, of which the increase in May was 18.8%.However, the sales of high-end business restaurants such as Shunfeng, Quanjude, Bianyifang, Tiantian Yugang, Abalone Prince, and Yunlong Golden Pavilion Hotel, which were greatly affected by the financial crisis, began to show a rebound trend in May. From January to April 2009, the sales of these high-end business restaurants dropped by at least 10% compared with the same period.The information on the recovery of high-end restaurants is very important.I hope that the increase in high-end restaurant consumption comes from the growth of the real economy, but I worry that due to the recession of the real economy, more funds from the real economy will flow into high-end restaurants for consumption.For example, due to the two difficulties mentioned in the first chapter of this book, capital from the manufacturing industry flows into the stock market, property market, and auto market, and a small part of the capital may also appear in the form of eating, drinking, and entertainment, resulting in the collapse of high-end restaurants and even nightclubs. pick up.Of course, the sharp rise in stock prices during this period may also encourage consumption desires such as eating, drinking and having fun.

I would like to ask readers a question, if you were asked to run a restaurant, or if you went to a restaurant to eat, what kind of restaurant should you choose?What are your selection criteria?Do you attach importance to service quality and dining environment?In addition, a restaurant is a place to eat after all, so is the taste important?Therefore, under the impact of this wave of financial tsunami, in order to attract customers, many restaurants have improved from these aspects, especially the diversification of tastes.For example, Xiaonanguo Group has developed Xiaonanguo Hot Spring SPA, Xiangshi 78 Chain, Manji Dessert and other business formats; Jixiang Wonton has successively developed a variety of business formats such as Jixiang Restaurant, Laoyangfang, Shiliu Dabao, Yipinhan, and Changwang Spicy Noodle Restaurant; The "Taste City" under the Qiding Group has also developed different formats such as Dingzhongding Macau Doulao and Isabella Pizza.In addition, "Jiangsu Hui", which specializes in classic Shanghai dishes, will also launch a second-tier brand "Douxiangyuan" targeting the public pastry this year.According to the company's marketing department, the price of "Douxiangyuan" is similar to that of Ajisen Ramen, but its decoration style and dining environment will be more pleasant.

We used to think that the "lipstick effect" is that consumers tend to choose restaurants with high cost performance, that is, taste, environment and service divided by price. Cost performance 3 = (taste + environment + service) / price However, do consumers really choose restaurants this way?According to the data of Dianping website on April 19, 2007, 240 restaurants in the Shanghai catering market were selected and divided into 6 types, including small shops, tea restaurants, chain fast food restaurants, specialty restaurants, high-end specialty restaurants and top specialty restaurants. Choose 40 of each type.After consumers go to these restaurants to eat, they will rate the restaurant's environment, service and taste, and the score range is 1 to 5 points.All customers' ratings on the environment, service and taste are added together, and divided by the per capita consumption price of each restaurant is the cost performance 3.

From Table 9-1, we can clearly see that the price/performance ratio 3 of small stores is the highest, at 4.51.Other types of restaurants were 2.2 (tea restaurant), 1.18 (chain fast food restaurant), 0.58 (specialty restaurant), 0.37 (high-end specialty restaurant) and 0.11 (top specialty restaurant). According to the data in Table 9-1, we can make Figure 9-2, the curve in the figure is cost performance 3.We can clearly see that the most cost-effective 3 is actually a small shop in front of your door, and the more you go to a high-end restaurant, the lower the cost-effective 3.Therefore, if you analyze it in terms of cost performance, you have no reason to go to high-end restaurants to eat, because the cost performance is extremely low.So why do you still go to fine dining restaurants?Is it because of the environment, taste and service?It's completely wrong, if you only value these three points, then you should go to the small shop in front of your house to eat beef noodles.

So, what's the problem?In addition to the environment, taste and service, there is also a score called satisfaction.We averaged customer satisfaction according to the type of restaurant and compared it with cost-effectiveness 3, as shown in Figure 9-3, we found that the cost-effectiveness 3 is getting lower and lower from small shops to chain fast food restaurants to high-end restaurants, but Customer satisfaction is basically the same, and satisfaction has almost nothing to do with cost performance. Taking a small store as an example, customer satisfaction and cost performance coincide, that is to say, because the cost performance is high, customers are more satisfied.But looking at the top restaurants, their price/performance ratio 3 is close to 0, but the customer satisfaction is about the same as that of small restaurants.What is the charm of a top restaurant? How can they maintain such a high level of customer satisfaction with such a low price/performance ratio?What is the gap between satisfaction and value for money3?It is this gap that you don't understand that brings you into a high-end restaurant, as shown in Figure 9-4.

The line in Figure 9-4 is the essence of the restaurant industry - "intangible experience". This intangible experience is not clear, it is a so-called feeling.We make most of our decisions based on our feelings, but we don't really understand what feelings are or how to express them.When we choose to eat in restaurants, it is often because of feelings, and feelings account for a large proportion.Therefore, the real cost performance of the restaurant is cost performance 4. Cost performance 4 = (taste + environment + service + industry essence) / price

The essence of the restaurant industry is an intangible experience.This intangible experience has not been discussed in the past, and no one knows, but it is the factor that brings consumers into fine dining restaurants.So what is an invisible experience?Let me give you a simple example. Everyone is familiar with McDonald's and Burger King. Let's compare the environment, service and taste of McDonald's and Burger King, as shown in Figure 9-5.We can clearly see that Burger King is superior to McDonald's regardless of environment, service and taste.So I ask readers, would you take your kids to Burger King or McDonald's?You must be going to McDonald's.Then why do you go to this McDonald's, which has poor service, environment and taste, instead of Burger King, which is good in everything?Because your kid likes to go to McDonald's and not to Burger King, why?Because your children don’t feel it when they go to Burger King, but they feel it when they go to McDonald’s. How do you feel?That's what makes McDonald's successful -- the intangible experience of a happy family.That's why McDonald's returns far outpaced Burger King (McDonald's returned 10.64% compared to Burger King's 6.23%).

Do you think the intangible experience of this happy family is important?Let me ask you, parents, do the husband and wife quarrel a lot at home?How did your children react?Will cry or cry, right?What would you two say?Okay, let's stop arguing, don't scare the kids, let's go back to the room and quarrel.In fact, that bully in your family often fights with his classmates at school, right?He is not afraid of anything at all, how can you two quarrel to scare him?Think about it, why do children cry?Because the two of you quarreled and destroyed the innate nature of the child-the feeling of a happy family, so he will cry.And the younger the person, the stronger the feeling of this happy family.This is why it is easy for young people to get married, because the younger they are, the stronger the feeling of a happy family, so many people want to get married as soon as they graduate from college.I often joke that at my age, the feeling of a happy family has disappeared. If I were to get married again today, I would first think of divorcing and half of the property would be divided. It is not easy for me to make money, and I am reluctant.And I found that in the past few years, I have slept very well in Sandian, which is not good at home, because I no longer feel like a happy family. Readers can take a look at the advertisements of McDonald's, which are basically based on the concept of a happy family, and they are mainly children's advertisements.Look at the Burger King commercials, either with the Hulk as the spokesperson, or gobble up burgers like snakes.Readers, please note that this Hulk is our understanding. In fact, the Hulk is the protagonist of a very famous series in the United States, and it is a green-faced zombie.The children were terrified when they saw the zombies, because zombies cannot marry.Zombies have absolutely no happy family feel.And in the commercials, it crawls to the dining table like a snake, and then devours the burger like a snake. These scenes must have scared the children, and the snake does not have the feeling of a happy family. Readers, please think again, when the financial tsunami hits, how do these high-end restaurants cope?It turned out to be diversification of tastes, redecoration or retraining of waiters to provide better service, and the more advanced restaurants are doing this.These high-end restaurants basically got it all wrong, so they were the hardest hit when the financial tsunami hit.If you want to be a high-end restaurant, you must grasp the essence of the success of a high-end restaurant, that is, the intangible experience. According to economic theory, if the economic depression causes your income to drop by n%, then your consumption of luxury goods will be greatly reduced, falling by more than n%. In the first quarter of 2009, Louis Vuitton's turnover fell by 7% year-on-year, Gucci's turnover fell by about 5%, Dior's sales plummeted by 8%, and Saint Laurent's sales fell by 10.2%.In addition, Louis Vuitton jewelry sales fell 41% in the first quarter, wine and spirits fell 22%, and perfumes and cosmetics fell 11%.Overall, global luxury goods sales fell 14% in 2008, and they have never fallen this far, possibly for the first time in history. However, China's economic depression this time has a characteristic, that is, the two major difficulties faced by entrepreneurs (the deterioration of the investment and business environment and overcapacity) have not been resolved, so a large amount of manufacturing funds flow into the luxury goods market, which leads to an abnormal luxury market. The recovery, coupled with the practice of sharply reducing the price of luxury goods to improve cost performance, has stimulated consumers' consumption desire.In the first quarter of 2009, Guangzhou Friendship Store and La Perle Plaza used promotion methods such as price cuts, and the sales of luxury brands bucked the trend and increased by 20%.In addition, taking Guangzhou Friendship Store as an example, in the first quarter, the sales growth rate of international first-line jewelry, watches and other brands exceeded 15%, among which, the sales growth rate of famous brand watches worth hundreds of thousands or even hundreds of thousands of yuan exceeded 90%.The growth rate of Friendship Store in the second quarter reached 13% year-on-year, of which the jewelry category increased by about 23% in June and 29% in May. Chapters 10 and 11 of this book will analyze what is the essence of a luxury brand.Even if the essence of the industry is grasped, it cannot withstand the impact of the economic depression, but it can attract manufacturing funds squeezed out by the two major difficulties. Chapter 12 will discuss the essential meaning behind the recovery of luxury goods. The thirteenth chapter synthesizes all the cases in the third part and puts forward a new thinking.Zara (ZARA) focuses on cost-effectiveness 1, and can also break through and become a world-class brand. The way to break through is to improve the appearance of fashion and lower the price through the efficient integration of the industrial chain.Industrial chain integration can become China's "fourth carriage" to drive China's economic growth.