UPDATE: Campbell Soup’s new CEO plans to increase the salt content in its core soup products.

Researchers at the University of Exeter released findings this week questioning claims that lower sodium diets can reduce the risk of death from heart disease.

While still early, these findings challenge the opinions of public health advocates who have lobbied municipalities, most notably New York, to reduce salt content across a range of food products, citing that eighty percent of salt in American’s diets comes from packaged or restaurant consumables.

While industry reaction to sodium reduction proposals have been mixed at best, companies ranging from Pepsi to Taco Bell announced initiatives to identify new seasonings to reduce salt content in their products.

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Operators understand very acutely the effectiveness of price changes – after all, nothing else in the business can impact the bottom-line so directly.

Despite this appreciation for the importance of pricing, the sophistication by which most companies manage prices is woefully inadequate.

Industry pricing “leaders” comment on the problem frequently, revealing “we should remind our guests value isn’t just a function of price,” and “if it’s a $3 price point one day and then it’s all of a sudden $4, that’s not palatable to a consumer. But if it goes up to $3.29, that’s a little bit easier to take.”

If this is the best that the industry has to offer on this subject, then we’re all in a lot of trouble. (more…)

Jonathan, Josh, and Michelle from APT enjoyed attending this year’s RLC in Scottsdale.

Political punditry aside, the burgeoning marketplace for daily deal sites and social media continued to be a hot topic – as the novelty of these coupon channels wears off, we are seeing operators move past simple redemption stats to understand what impact these various offers have on actual profits. Additionally, we enjoyed insightful conversations about how restaurateurs are evaluating new pricing and menu strategies in a world with increased commodity costs and signs of a recovering consumer.

We enjoyed hearing from industry leaders ranging from Sally Smith at Buffalo Wild Wings to Robert Brozin, chief of the expanding Nando’s Chicken chain, building on recent interviews with Starbuck’s Howard Schultz and Panera’s Ron Shaich.

Also of note, we’ve been remiss in not mentioning it earlier, we’re thrilled to welcome Wendy’s into the family of companies driving value from Test & Learn^TM.

We’ll write more about detailed reflections from the RLC in future newsletters.

Location based marketing is “here.” From Chili’s to Target, leading restaurants and retailers are showing an enthusiasm for piloting offerings from a range of hot New York and Silicon Valley start-ups including Foursquare, Shopkick, and Gowalla.

While each location-based service (LBS) is unique, they are all oriented around a central core principal: offers and coupons are most effective when restaurants and brands can target consumers at a specific time and place. (more…)

This post is the third in a three part series on ideas that will shape restaurant performance in 2011.

Part Three: Marketing

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This post is the second in a three part series on ideas that will shape restaurant performance in 2011. Part three will follow next week.

Part Two: Expansion, Investments & Operations

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UPDATE: During their earnings call earlier this week, Starbucks announced that over 3 million payments were received via mobile phones. That makes Starbucks the largest mobile payments system in the world…

Starbucks recent announcement of an iPhone app that can be used to pay at the register has received a lot of press this week. As did McDonald’s announcement in the UK of its contactless card payment system. From a technology standpoint, this app is one of a number of new systems that have recently come into the market – we discuss some of the other options available to retailers here. We’ll keep our readers updated as to which systems gain traction following in-market testing.

Happy New Year from all of us at APT’s Food for Thought. 2011 promises to be an eventful year in the restaurant space and we’ve heard a number of bets, top 10s, and guesses for what the year, and the strengthening economic recovery, will hold.

We’ve synthesized these ideas into a special series, in three parts, that we are launching below. Stay tuned over the next two weeks for more.

Part One: Menus, Value Meals & New Offerings

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As we’ve discussed before, convenience stores have their sites trained on the lucrative quick service prepared foods market. Through a languishing economic recovery, consumers are looking for quick and convenient meal options at affordable prices without sacrificing quality. Many c-store operators believe prepared foods to be key to customer loyalty and higher profitability. For example, Steven DeSutter, president and CEO of Stripes, is recently quoted in Convenience Store News as saying that prepared foods is their “greatest loyalty program.”

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The restaurant business is full of concepts that have gone stale.  Mindful of their sizeable investment (a sunk cost!), many restaurants attempt to enhance or revive their tired platforms with mixed success.  Rarer, but more important and much riskier, is the “relevance reset” – something big, announced with great PR fanfare and paid media – that says to the customer: “Hey, I know I was irrelevant to you in the past… but look again!”

We first heard the term “relevance reset” in a Pizza Hut presentation to investors earlier this year.  Executives described their $10 Any Pizza effort as “not a traditional [marketing] window.  It is a relevance reset” (complete with a graphic of a giant reset button).  Since then, we’ve been looking at the industry with this concept in mind.  When new ideas are launched, are they game changing, like $5 Footlong or Domino’s new pizza campaign?  Or, are they possibly-helpful-but-not-game-changing tactics, like Fire-Grilled Ribs at Burger King or IHOP’s lower-calorie Simple & Fit menu (all of which may be fine, but won’t make a stale concept fresh again)?

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