One of the things that makes marketing advice sound so specious, at times, is when the marketing advice dished up is considered newly insightful, but is, in reality, just a description of the eternal obvious, the “greens fees,” the “table stakes.” When The Wall Street Journal ran an article titled, “Restaurant Executives Tell Us How They Get Customers When Times Are Hard,” you might have been expecting some real insights. You might have expected some new ideas for doing business in a shaky environment.
Not so fast.
The Wall Street Journal’s list of business advice provided by interviewing restaurateurs is basically the same as QSC&V. QSC&V – Quality, Service, Cleanliness, and Value – are the elements on which Ray Kroc built McDonald’s.
Yes, McDonald’s. Ray Kroc’s playbook. Still alive, well, and in use.
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The actions that are keeping today’s restaurants alive are, in essence, a manifestation of Ray Kroc’s mantra—modernized, to be sure, nevertheless, QSC&V. Ed Deming, the quality expert who said, “Quality is consistent conformance to customer expectations,” was laughed out of America when he said McDonald’s was the highest quality restaurant. According to Mr. Deming, a brand that consistently meets customer expectations is of high quality. McDonald’s is consistent across all dimensions, across geographies.
McDonald’s was built as a restaurant system known for consistently high-quality food and uniform preparation methods. A business built and based on the system’s consistent quality reputation rather than on the quality of a single store or owner-operator.
Along with QSC&V, Ray Kroc believed in customer focus. He believed that when McDonald’s took care of the customer, the business would take care of itself, its owner-operators, and its suppliers. Mr. Kroc said,
“That is why we stay focused on the customer and the customer’s needs and consistently do everything we can to promote true customer understanding. This means staying close to the store and working with our customers to achieve results that benefit the system. It means satisfying our customers time and time again. It means looking at everything we do from the customer’s perspective.”
He added:
“Be the best at quality, service, and cleanliness. Set high standards for QSC. It pays off in the long run. We’ve talked about QSC for years. Let’s keep talking about it forever. The basics have to be stressed over and over again. It seems to be human nature for people to try to chisel away at quality in order to save pennies. It’s just poor business to compromise quality and hope the customer won’t notice. You don’t get compliments for keeping the store clean and well-organized. But when it’s not clean, you’re going to get a lot of criticism. Have a place so clean that customers will have confidence in what we produce. There’s an intangible something that’s noticeable to everybody and puts us a step above – a touch of class. Do it first class. If you do it first class and you don’t compromise quality, service, and cleanliness, then everybody else will have to play catch-up. Our competition will wear themselves out trying to keep up.”
The Wall Street Journal gave QSC&V and customer focus a more glorified articulation. But, the truth is that without quality offerings, great service, a clean – in the broad sense of the word, including scrubbed, polished, immaculate, fair, honest, accurate, uncomplicated – environment and customer-perceived value with a customer focus, you might as well hang up your cloche and close down the store.
Rather than giving credit where credit is due – to a fast-food joint – the restaurateurs and The Wall Street Journal are presenting their actions as amazing insights. The following are not insights. These are observations of what should be and are obvious.
Here are the actions from The Wall Street Journal’s synthesis of the restaurateurs’ interviews.
1. Offer Good Value
Why are marketers still thinking that offering value is a surprise tactic? There remains an inherent misunderstanding of the difference between price and value. Today, even the people at McDonald’s confuse price and value.
The interviewed restaurateurs discuss their prices and deals. These price reductions and deals do make money in the short term. But the risk is a focus on price and the deal at the expense of the brand.
Price is a cost. There are two other important costs that customers use to assess a brand value: time and effort. If total costs are higher than total brand experience, the customer perception is that this brand is a poor value, not a fair value.
To be considered fair value and not be perceived as cheap, brands must avoid excessive marketing communications that emphasize price as the reason to buy. Building deal loyalty does not build brand loyalty. Deal loyalty is not real loyalty. Brand loyalty cannot be bought with bribes. When you lure customers with incentives, you end up making them loyal to the deal rather than the brand. If there is a better deal elsewhere, deal-loyal customers are out your door and in through the competitor’s door. If a customer does not prefer your brand’s experience, then making it cheaper and easier will not build brand strength. Occasionally reminding people that a brand is affordable is important. But excessive emphasis on price alone destroys real loyalty and builds deal loyalty. Instead of the dominant message being about price, to revitalize a brand, the new communications emphasis needs to be on brand-relevant differentiation. Tell customers this is a great brand at a great price, rather than just saying it’s a great deal.
McDonald’s, in Ray Kroc’s eyes and heart, was about this:
“We feed the masses. We have to take a few items that most people want and then do the best job we can while keeping our prices as low as practical.”
2. Cut Through The Noise
Restaurateurs are proud of their ability to put their messages across to customers. With all of the noise beyond TV into the digital realm, being able to connect with customers and “get them to the door” is critical. But, again, there is the problem with what is the promotion message.
Promotion is one of those terms that now has a limited and unfortunate meaning in marketing. As with the “value equals low price” connection, marketers are their own worst enemy when it comes to promotion. Marketers often interpret promotion as meaning short-term tactics designed to generate immediate traffic. Promotion has come to mean a “price-off” event, and that is a mistake. Promotion is more than “20% off this weekend,” “two for the price of one,” or “2 for $20.” Promotion must be more than a short-term tactical incentive to “buy now.” However true this may be, it seems to be a losing battle: marketers persist in treating promotion as a Limited Time Offer (LTO) rather than taking a long-term view of how to elevate the brand in the customer’s mind.
The original definition of promotion is not as incomplete as it is in current marketing. To “promote” means to elevate to a higher level, to advance in rank or position. The purpose of all brand communications should be to elevate a brand to a higher level; to advance the brand to a higher position in the customer’s mind. According to Merriam-Webster, promotion means “the act of furthering the growth or development of something.” When marketers discuss the balance of advertising versus promotion, they are posing a false choice. All marketing communications are promotional and should advance the brand’s growth.
Ray Kroc used promotion. Promotion communicated the full brand experience, including a great price. Ray Kroc said,
“Believe in the benefits of good marketing. But good marketing is useless without good operations. Great marketing promises will get people into the store, but excellent operations get them back.”
3. Spiff It Up
Having a great total brand experience is critical – and always has been. Brand experience is one of the reasons that Chili’s is performing strongly. Brand experience is not the deal. Brand experience is more than the meal. Brand experience is defined not by features but by the brand’s benefits, rewards, values, and personality. The brand’s guiding principles define the brand experience as the way the brand wants the customer to feel.
Ray Kroc defined McDonald’s as a Happy Place. Here is how Ray Kroc defined McDonald’s:
“The smile on our people’s faces is a vital part of our image. We don’t just feed people, we entertain them. McDonald’s is not in the restaurant business; it’s in show business. Create a feeling of togetherness, energy, and commitment. Help make the whole McDonald’s enterprise a fun place to work. If you do it for the money alone, you will not achieve your potential. The real reward is the smile created on a customer’s face. “
4. New Eats On The Menu
Innovation and renovation are the lifeblood for brands. Innovation and renovation generate news. News interests customers and potential customers. Innovation and renovation were actions that Ray Kroc saw as part of customer focus. Innovation and renovation were critical to both brand and owner-operator success. He said,
“To be successful, you’ve got to be daring, you’ve got to be first, and you’ve got to be different. Leaders must lead. I don’t want to run after anybody. I want them to run after us. Customers see a slow-moving company as behind the times or arrogant. Be ready to accept a new idea. Innovation is the lifeblood of growth. Create an environment that breeds innovation. Maintain consistency while responding to change. Reinforcing familiar experiences is the basis of customer loyalty. We provide food that customers love, day after day after day. People just want more of it. At one time, you could only get a hamburger at McDonald’s. Now, there is broad customer demand for foods other than hamburgers. I don’t know what we will be providing in the future. But, whatever it is, we will sell more of it than anyone else.”
5. Winning On Service
In The Wall Street Journal, there is little about how much the restaurateurs care about “customer care.” The takeaway is that restaurants are adding items and meal deals to keep the brands afloat. When was the last time you ate in a casual restaurant and felt that the brand cared about you?
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One of the things that made Applebee’s great was its customer focus. The brand was focused on the people who composed the neighborhood. The wait staff focused on the customers. One staff member said her goal was “To make a friend at every table.”
Ray Kroc stated it this way:
“Our philosophy is one of helping the customer. Look at everything we do from the customer’s perspective. Design everything with the customer in mind. The customer is not an interruption of our work but rather the purpose of it. Treat the customer with tender loving care. The customer is the most important person in our business. Take care of the customer, and the business will take care of you. This is what it’s all about – catering to people, serving people. Show our customers that you really appreciate their business. Do things that will make customers know you care.”
In reviewing Ray Kroc’s quotes, it’s clear that the principles for success in good times and bad were laid out decades ago. The current crop of restaurant brands is just re-creating the wisdom of Ray Kroc. There is no new insight in the reporting from The Wall Street Journal’s interviews.
Restaurateurs will say that fast food is different. Casual dining has different elements and more moving parts than McDonald’s. If you think about an order of a Big Mac and fries (ingredients, napkin, bag, fry box, burger box, etc.), a million times a day around the world with the consistency of McDonald’s, you will understand that the “moving parts” are much more complex than a meal at Texas Roadhouse.
QSC&V and customer focus still live.
So, if you want advice on how to win in today’s eating-out world, look to Ray Kroc. Put the customer first. Adhere to QSC&V. Behave as if these principles were not just a life raft but the brand’s stagecraft.
Contributed to Branding Strategy Insider by: Joan Kiddon, Partner, The Blake Project, Author of The Paradox Planet: Creating Brand Experiences For The Age Of I
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