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A Salty Debate on Sodium Reduction

July 6th, 2011 | Posted by Admin in Restaurants | Restaurants | Uncategorized - (Comments Off on A Salty Debate on Sodium Reduction)

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.

(more…)

McDonald’s Evolutionary Testing

December 2nd, 2010 | Posted by Jonathan Marek in Restaurants | Restaurants - (Comments Off on McDonald’s Evolutionary Testing)

McDonald’s is testing “Garden Fresh Wraps”, which appear to be the evolution of prior a new product concept they’ve been trying for awhile: a portable, chicken “non-sandwich”.  Of course, as with all QSR product tests, the big issue is incrementality.  Even if I sell a lot of the new product, did I sell less of something else on the existing menu?  It’s a tricky question that requires top-notch testing analytics.

More broadly, we love the idea here — if the first product in the concept doesn’t work in test (we assume), how do you tweak it and quickly retest?  Many QSRs could do this better, rather than just rolling what they’ve got regardless of the test results. As Chicago Tribune reporter Steve Johnson notes – without testing, well known brands run the risk of straying from their core strengths and losing customers.

Red Lobster and Testing in Washington Post

August 4th, 2010 | Posted by Jonathan Marek in Restaurants - (Comments Off on Red Lobster and Testing in Washington Post)

Great article in yesterday’s Washington Post by Steven Pearlstein, covering the history and business applications of testing and calling out Red Lobster’s use of Test & Learn to drive significant improvements in their remodel program.

One of the most common comments we hear from restaurant CMOs/CCOs is “we test, but our tests aren’t as predictive as they should be”.  Here’s a case in point.  Per the Wall Street Journal, Burger King is running out of ribs for their LTO.

Just three weeks ago, we wrote that BK Ribs was an idea worth testing, despite a lot of skepticism from industry analysts and food bloggers.  Well, what’s worth testing is worth testing well.  A scientifically designed, rigorously analyzed test is predictive.  (more…)

The former President of Subway’s Franchisee Advertising Fund Trust once said:

Some people think Test & Learn is a lot of nerdy analysis.  I think just the opposite – Test & Learn helps us to be maximally creative and risk taking.

It’s that attitude that identified Subway’s $5 Footlong (from among many tested ideas) and turned it into a massive nationwide success.  Hopefully, that’s the attitude Burger King is taking to its new rib offering, and its high-end offerings in general.

We don’t know if $7 to $9 ribs are going to successfully steal share from casual dining.  Conversely, we don’t know if ribs will confuse the customer as BK tries to compete at $1 and $5 price points.  But neither do industry analysts, despite their pronouncements.

Burger King, on the other hand, can know the answer, because they are testing it.  If they have the right analytics to cut through the noise and understand the real impact, they can find the great success despite the critics.  Or, they can “fail fast” and move onto the next test.

Social Media Measurement: Deja Vu All Over Again?

May 3rd, 2010 | Posted by Jonathan Marek in Restaurants | Restaurants - (Comments Off on Social Media Measurement: Deja Vu All Over Again?)

Oracle makes an interesting attempt at setting social media targets here.  To quote:

Typical [goals] might be to acquire customers, engage them, then convert them. So that translates to:

  1. Increase Facebook fans and Twitter followers
  2. Increase comments/posting and retweets
  3. Increase redemption of offers via Facebook and Twitter

While not unreasonable, we call these “second derivative metrics” here at APT (except redemption… we’ll get to that).  That is, by driving one of these metrics, perhaps that will then drive consideration, which then may drive an incremental visit/purchase.  The funny thing is that this really mimics the broadcast media world, where ad agency measures of “awareness” and “consideration” are de rigueur.

We think you can do better. (more…)

… are “mixing” and “redemption”.  Well, at least from the standpoint of someone focused on increasing profits.  Let’s take them one at a time:

Mixing, as in “our new item is so great it was mixing 5% within two weeks!”  Umm, great, you are selling a lot.  What happened to profits?  To margin rates?  Did you get incremental guests?  What halo did you see in rest of check?  What got cannibalized?  I’m thinking of developing a 10 cent double cheeseburger — boy, that’ll mix well!

Redemption, as in “we got 30% redemption on our Facebook coupon!”  It was distressing to hear folks from major social media platforms brag that “redemption rates on social media are orders of magnitude better than print couponing — 30% instead of 1%”.  Redemption ≠ incremental sales.  McDonald’s could hand a coupon for Free Fries to each customer walking in to the store at lunch.  Redemption would be through the roof, but was it really incremental?

Deep understanding of incrementality is difficult in the restaurant business.  Even consultants, agencies, vendors, and restaurant companies that purport to “prove” incrementality seldom get the analysis right.  So I can understand why marketers turn back to these scary words… but that doesn’t mean mixing and redemption lead to actual profit.

Innovation

April 21st, 2010 | Posted by Jonathan Marek in Restaurants - (Comments Off on Innovation)

Here are three quotes from a great presentation yesterday given by Einstein Noah Restaurants and Bellwether Group.  The topics were around innovation and testing — near and dear to our hearts!

From Jeff O’Neill, Einstein Noah CEO:

Too often, value is what restaurants do when you don’t have innovation… because you don’t have an effective innovation process

From James O’Reilly, their CCO (second C = Concept):

The problem isn’t having an innovation process, it’s sticking to it

and, on one important reason testing is a key part of that process:

It’s OK to fail.  You just don’t want your customer to see you fail

Interesting stuff!

Leveraging the Local Option

April 16th, 2010 | Posted by Jonathan Marek in Restaurants | Restaurants - (Comments Off on Leveraging the Local Option)

The Test & Learn Summit continued Tuesday, including the Food for Thought session focused on restaurant issues.  One major discussion topic was around the “local option”, periods of time in the marketing calendar when QSRs’ market-level franchisee groups can choose localized promotions and media support.

Local option periods can provide a wealth of insight into which programs work and which don’t, if managed correctly.  (more…)

Flying Blind

April 13th, 2010 | Posted by Jonathan Marek in Restaurants - (Comments Off on Flying Blind)

Test & Learn Summit keynote speaker Haim Mendelson had a great quote yesterday from Zynga founder Mark Pincus:

If you’re a visual pilot and you fly in the clouds, your life expectancy is about 180 seconds

A nice metaphor for trying to manage without testing and analytics in a modern business environment!