Restaurant media

"Restaurant media" is an emerging form of retail media advertising used in cafeterias, fast food and family restaurants and diners and that reaches consumers while they dine.

For decades most fast food restaurant chains employed various in-store advertising media such as billboards, posters and paper tray covers and these media are rapidly being replaced by digital signage. The concept of delivering multimedia content to customers of fast food restaurants and food courts emerged in early 1990s and became increasingly popular in recent years. Burger King and Tim Hortons were among the first fast food restaurant chains to deploy digital signage projects involving plasma displays, LCD panels, self-service interactive kiosks in their restaurants [ [http://www.kioskmarketplace.com/products_128.php Burger King virtual fun center] ]

Restaurant Media Overview

* Plasma displays and Liquid crystal display panels: Flat panel are the most common digital signage or narrowcasting vehicles and are commonly located at or above the food service counter. This form of retail media usually attracts visitor attention with custom programming and helps customer make the best product selection. In some cases this is used for third-party advertising.
* Interactive kiosks: Some fast food restaurants have deployed interactive kiosks, allowing customers to make purchase of food or third-party products while being exposed to restaurant or third-party advertising.
* Interactive table-top displays. The use of table-top displays is emerging in mainly full-service restaurants providing customers with the ability to call the waiter, order menu items online, access Internet, television and custom restaurant programming.
* Interactive Multimedia food service trays: One of the major recent breakthroughs in restaurant media was invented in late 2006 by Canadian entrepreneurs and is currently being evaluated for launch by major fast food restaurant chains.
* Gaming corners: In order to better target the youth segment and to generate additional revenue from third-party sponsorship, several restaurant chains are launching multimedia gaming corners. McDonalds and Burger King in certain regions installed video game console systems.
* Internet access outlets: Internet access points are becoming popular in cafeterias, shopping malls and full-service restaurants and are generally used to attract customers to the restaurant as well as expose them to third-party advertising.
* Interactive fast food ordering systems: To facilitate for a large group of take-out customers and to improve service of eat-in customers during peak times, many restaurants deployed touch screen ordering systems usually located at the entrance to the restaurant or drive-through area.

Restaurant Media Trends

Strong competition will also continue among food service players as they attempt to capture business from these time starved consumers. Major players are already looking for innovative ways to appeal to customers, as evident by the recent renovation announcements from food service giant, McDonald’s Corp. The restaurant chain is establishing what it calls the “next generation” of McDonald’s - restaurants equipped with leather chairs, plasma televisions, and wireless internet. The goal of the renovation is to create a setting to win back customers, particularly young adults and families, and even attract a new type of customer who likes to linger throughout the day. The restaurants are being designed with three key zones: a fast zone, a social zone and a “linger” zone. To date, restaurants with this new format have seen increased guest counts as well as increased sales [http://www.boston.com/business/globe/articles/2006/10/26/mickey_ds_goes_uptown?mode=PF Boston Business: New generation of McDonald's, complete with redone amenities and menu, is headed this way] ] , effectively demonstrating that consumers’ expectations regarding the dine-in environment are changing. The major players in the food service market have been competing with new product introductions, healthier menu items and new, friendlier restaurant designsEuromonitor International: Market insight (September 2006): The Market for Consumer Foodservice in the USA ] . McDonald’s has begun a $5 billion renovation project to try to encourage patrons to linger longer in their restaurants. This demonstrates two things. One, traditional “fast food” restaurants are looking for ways to keep customers in the store longer in an attempt to generate more purchases. And two, the old value proposition behind fast food: deliver a meal cheaply and quickly is also changing. Consumers are becoming so immersed in technology, media and marketing that they are now even expecting to be entertained while they dine.

Consumer Trends

The U.S. saw an increase in the number of households from the period of 1990-2005 yet it also experienced a decline in its population. This resulted in a net decrease in the number of people per household, fuelled mainly by single person household growth (an increase over the period of 30%) as well as two-person household growth (an increase over the period of 25%). Full-service and fast food restaurants will continue to benefit from this trend, as single and two person households find it more economical to eat meals out rather than prepare them at homeEuromonitor International (September 2004): The Market for Consumer Lifestyles in the USA (page 78)] . A research study by Ipsos-Insight also found that 32% of Americans currently eat at restaurants at least a few days a week and 61% do so at least once a week. Disposable incomes in the U.S. are predicted to increase between 2005 and 2010, as a result of continued growth in the number of dual income households. This is a favorable trend for the food service industry for two reasons. First, an increase in the number of dual income households means that there is increasing time pressure on the household and a willingness to seek out convenient dining options. Second, increased disposable income typically indicates people will spend more in restaurants. This dual income segment also continually looks for an appealing atmosphere which allows them to dine with friends and family.

The Teen Segment

There are 73 million people under the age of 18 in the U.S. and these individuals represent the next generation of spenders, a marketing-savvy group that has grown up immersed in technology, the Internet and is accustomed to instantaneous delivery of information. Marketing to the teenage segment of the population is becoming increasingly difficult as the segment now experiences targeted marketing from a very early age. It is hard for advertisers to cut through the media clutter and deliver messages that are relevant and will resonate with this increasingly savvy (yet lucrative) group. This group also tends to be the largest among early adopters of new technology. Trends in gaming, PC and internet usage and mobile technology have all become ingrained in their way of life.

According to a report from Forrester Research, promotions that work well with teens include advergames, instant-win games, online coupons, streaming video ads and cell phone promotions [Euromonitor International: Market insight (September 2006): The Market for Consumer Foodservice in the USA (page 3)] . Restaurant media that encompasses video ads and other multimedia content and encourages interactive game playing will effectively capture the attention of this segment.

Competition in the Food service Industry

Competition in the food service segment is also becoming increasingly fierce as restaurants look to attract diners from other types of restaurants in order to increase their own traffic. Competitors who have not kept up through menu innovation or by offering new services have felt the strongest pressure competitively. Restaurants that demonstrate innovation and creativity to improve convenience and service will be those that achieve differentiation from competitors. Moreover, those restaurants that are able to provide new concepts that can appeal to a wider variety of customers will also realize increased returns.

References

External links

[http://www.fmi.org Food Marketing Institute]