Effective Menu Optimisation

18-Apr-2016
Hotels, Restaurants

Your menu is the one piece of free advertising that all of your customers will see. Unfortunately menu design is an area where restaurateurs pay the least amount of attention, thinking that food and atmosphere will be enough to drive sales. A well-designed menu doesn’t just drive sales, it optimises it.  One of the critical factors of restaurant success is the management’s willingness to put time, effort and resource into planning and designing the menu. Studies show that 40% of restaurants perform some sort of menu optimisation, but only 10% are doing a good job, leaving a lot of easy profits on the table for most.

Here are some key-tips for menu optimisation:

  1. Cost your menu

In order to understand profitability levels per menu item you need to determine how much it cost to create it. 80% of restaurants do not cost their menu and another 5% cost their menu incorrectly. The reason behind this is simple: costing a menu is time consuming. Unfortunately there is no way around that fact and you have to put in the work if you want to reap the benefits of a more profitable menu.

  1. Categorise according to profit and popularity levels

Go through each of your menu items and place each into one of the following four categories:

  • Stars – High profitability and high popularity
  • Horses – Low profitability and high popularity
  • Puzzles – High profitability and low popularity
  • Dogs – Low profitability and low popularity

The decision you will make as to the fate of these menu items will result from a combination of experience and common sense, but as a guidance you could act as follows:

  • Stars – This is easy. Your menu should highlight your stars.
  • Horses – Create more profitable versions of these items.
  • Puzzles – Investigate why these are not selling. It may be that lowering the price will increase take-up or it could be that customers just do not like the dish, in which case, drop it.
  • Dogs – If dropping the item is an option, do so, if not de-emphasise it by simply listing it without putting any effort into promoting it.

This exercise should be done at least once a year in order to keep food costs in check. This does not mean that you have to rewrite the whole menu or add all new dishes. It is simply a good time to make sure that prices are where they should be, and to assess menu items that are not selling.

  1. What do your customers want?

When deciding which dishes to put on your menu, the process goes beyond choosing the dishes you want to sell the most (your stars). Consider what drives your customers to your restaurant. Is it a certain dish, cheap drinks or another factor? Look at your competitors: examine their menus and marketing effort and try to identify where they go right and how you can compete successfully. Ask yourself what you can offer that others do not. The ideal food menu offers a balance of unique dishes and old favourites. Menu design must not be done in a vacuum and making assumptions without this research can cause serious under-performance.

  1. Optimise visual display

The layout of the menu is probably more important than the content. What ends up initially catching the eye has an unfair advantage over anything a customer sees or hears later on.

Here are some visual tips:

  • We generally scan the menu in a z-shaped fashion starting at the top-left hand corner. The area of the most attention is the top right–side. The least attention goes to the bottom of the page.
  • We are easily interrupted by items being placed in boxes, next to pictures or icons, bolded or in a different colour.
  • If the dish you want to promote is expensive, you may want to keep it out of the menu’s highest focal point, as this may make your restaurant appear to be expensive.
  • Don’t list your prices in a column down the right side of your menu, this causes customers to focus on price, not your food. Instead, place prices just two spaces after the end of the item description, using the same type font size and style.
  • Don’t use a currency sign next to the price as that causes customers to think about money.
  • Choose carefully when deciding on the amount of menu pages. One page menu’s (e.g. A3-size) causes people to make decisions faster, but they won’t order as much, thus leading to lower profitability per customer. This type of menu is suitable for a high turnover restaurants. Whenever possible, two page menu’s are the best configuration to use. It is easy to read and induces the strong feeling of a full dining experience. The more menu pages you have the less control you have over the menu and it hinders your ability to influence customer’s actions.
  • Although you may list your menu items in a vertical list, the level of customer focus does not follow the same pattern. The first few spots enjoy high level of attention, but after that it is the last item in the list that gets the most attention. The item just above the last item in the list are the most ignored.
  • By putting high-profit ‘star’ items next to an expensive anchor item, they seem cheap by comparison and are more likely to be chosen.
  1. Keep your menu short

It is not always easy trying to read a menu while hungry, woozy from the aperitif and exchanging pleasantries with a dining partner. Why is it so hard to decide what to have? Research shows that most menus cramp in far more dishes than people want to choose from and they feel burdened to choose. On average customers prefer seven starters and desserts and ten main courses. More than this constitutes information overload, and when this happens customers often default to ordering the most common items (such as burgers) which are usually not the most profitable ones. Smaller lists are easier to navigate and lead to higher profitability due to the purchasing of higher profit starters and a higher number of extra’s.

  1. Use menu descriptions to your advantage.

The name and description of a dish has a profound influence on diners. Give a dish an ethnic label, such as an Italian name, and people will rate it as more authentic. Give it an expressive description, and people will make far more positive comments about a dish’s appeal and taste. Studies have found that good descriptive text can increase sales by a whopping 27%. However, be careful for menu clichés (drizzled, infused, amuse bouche etc).

  1. Think outside the ‘menu’

Whilst a well-designed menu will increase profits, this can be boosted by teaching your staff which items are priorities. They are the ones who interact with your customers and can be instrumental in improving profits by up-selling and by guiding customers to your ‘star’ dishes and drinks. Visual displays on special boards can also improve sales.

Sound, smell and atmosphere can further influence sales. Classical music increases sales of expensive wines and overall spending. Slow music, and the scent of lavender, makes people spend longer in the restaurant and pop music will up the consumption of soft drinks. Diners eat more at breakfast if the room smells of grilled bacon!

  1. Make your diners excited to be in your restaurant

Your menu is your primary means of representation. It says exactly who you are and what you hope to convey. It should create enough of an impression so that it stays with your customer long after the server walks off with it. It must convey your restaurant’s brand in a manner that makes diners excited to be there, want to come back and to recommend it to family and friends.

  1. Price wisely

It is important that you compete in price and value against your competition. Keep everyday items approximately £1 more or less than your competition. When a menu item is unique to your restaurant the price can be a little higher but should not exceed the other items excessively. Doing so will make the latter more enticing to diners.

Also, look at the entire menu through the customer’s eyes. Are you providing value? Take a picture of each item in a way that mimics the actual presentation on the table. Ask yourself: Does this look worth the price you are charging? Could a change in presentation justify an increase in price? Is there consistency with the overall look or does there seem to be a wide range of inconsistency in the price versus its presentation?

  1. Ensure that the menu is versatile

This simply means that no item on the menu should stand alone. If you offer a fresh lobster roll, be sure to include lobster in other dishes as well. Otherwise, if you don’t sell any lobster rolls, the meat will spoil, and throwing food away in the kitchen is akin to throwing away money, which is unforgivable!

Your menu items should be easy to prepare. Nothing will bog a kitchen faster during the rush than complex menu items. Menu items should be one of two things: easy to prepare on the spot (saute, grill, etc) or easy to prepare ahead of time and reheat.

How to get started?

If you’re just aching to get started with menu optimisation, but need some support, we can help you put in place a strong menu that is in tune with your customers. All our business strategies and tools for hotels, restaurants, clubs and bars are drawn from our team’s vast experience in hospitality development and a good dash of expert intuition.

As we like face-time (sure, via iPad but more often than not in the flesh), we might start with a meeting to identify where we can help.  And get to know you of course. We look forward to helping you.

Would you like to know more?

Download our latest White Paper entitled “Why Return on Hotel Investment Can Significantly Underperform” or contact me, Lucienne Mosquera (Managing Director) for an informal conversation about your Investment.

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