Monday, April 29, 2013

Gordon Ramsay’s Five-Minute Market Analysis

The Pink Cadillac Diner in Natural Bridge, Va. definitely differentiates itself.

It takes me awhile to get caught up on television shows. Last night, I watched episode three of Chef Gordon Ramsey’s “Kitchen Nightmares” (2007). In this series, where he troubleshoots struggling restaurants amidst great drama, he tucks some small business assistance gems into his shows:
  • open your eyes to what the competition is doing (or in this episode’s case, notice that there is, in fact, competition),
  • do an internal check to see if you’re measuring up, and
  • make sure to differentiate your establishment.
Bad photo of the map Gordon used to show the town's restaurants

He also did some quick-and-dirty market analysis.

He put stickers on a map of the district marking the locations of restaurants in 1997. There were three. He then pulled out another map showing the number of restaurants ten years later and it showed 40+. The staff were floored – they weren’t keeping track of their competitors.

Then he discussed the mix of different restaurants, but noted there was something missing. The owner figured it out - there were no healthy food options. Gordon bellowed, “Give them [the neighborhood customers] what they want!”

I shouldn’t assume that Gordon’s team surveyed the community (intercept, online, etc) and confirmed a percentage of customers wanted a healthy choice restaurant in the neighborhood. Without a quick survey, he might have been taking a risky guess at what the community wanted. With today’s crowdsourcing tools, online survey websites, and social media outlets, we can easily get feedback on the businesses community members desire (type of cuisine, price points, atmosphere, specific dishes or drinks). Information we learn can be shared with existing business owners and new entrepreneurs.

An idea: Mapping out the competitors in different business categories and identifying the competitive edge of each one can give business owners a head start on considering their market position. It might light up new opportunities, too, when they see what isn't being offered.

The Mixing Bowl owner made Gordon’s changes and enjoyed success for a few years, but like most of the restaurants featured during season one, it eventually closed. In this case, I am not sure why, but it sounds like most of the restaurant owners didn’t heed Gordon’s advice or they fell back into old habits.

How can ideas from this show help your downtown?

Here are two things that you can’t benefit from: once word got out that Gordon was in town, customers flocked to the establishments and then more customers came through the doors after the show aired. You can’t recreate that. But, the cash registers were ringing because they were doing something new and different that gave people a reason to come in. That is something any Main Street business can, and should, do.

Taking care to have a distinct atmosphere in the dining room, refreshing your look every few years, eating your own food to make sure it is still good, refreshing the menu annually if not seasonally – these are all things that will make a place special and give people a reason to come back.

But don’t forget about the people who don’t know you yet. Buying a well-designed (read: professionally designed) ad quarterly, if not monthly, won’t break your budget and should catch the eye of a few new diners so that the ads pay for themselves.

The poor manager who put awful vinyl signs outside of the Mixing Bowl featuring odd deals and urging people to order their Thanksgiving desserts weeks before the holiday hopefully got an important lesson. Those “specials” aren’t special. The signs were just noise that detracted from a high-quality image of the restaurant. The care you put into your business and your image makes its special and the efforts you make to stay ahead of your competition and keep your establishment fresh makes it exciting for customers. And, hopefully, for the employees, too.

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