PHOTOS BY JOSH KEOWN
As Alex Taylor contemplates opening a second Due Forni location to complement the Las Vegas hot spot he shares with a collection of partners, he’s looking far and wide. Nevada. Texas. Colorado. North Carolina.
Knowing how critical site selection stands to his pizzeria’s success, Taylor’s taking his time. He’s researching, leaning heavily on credible demographic information to uncover the right spot. “Wherever we end up putting the second location, key demographics such as food and beverage spends and household spends will drive that decision,” Taylor says.
From independents to established mega-chains and growing companies, demographics can play an invaluable role in a number of key business areas, namely site selection and marketing, but also extending into customer communication, pricing, and merchandising. Al Beery, director of client services at Pitney Bowes Business Insight, a Connecticut-based customer communications management technology firm, says successfully utilizing demographic information can drive performance.
“If you can discover the characteristics of those who will frequent your place and reach out to them, you’re on your way,” Beery says.
To best apply demographics to the business, operators and providers alike agree it’s a two-step process.
First, pizzerias need to collect data that identifies their core customer. Thereafter, to propel site selection or marketing initiatives, operators can utilize third-party providers to find precisely where large numbers of those target customers reside.
Utilizing the “carrot approach” and offering customers incentives for their input, operators can collect data with intercept surveys that provide key profile information, including household demographics, dining frequency, sales drives and lifestyle characteristics. Such information will generate a profile of the pizzeria’s core customer and open new insights and opportunities.
If most customers live within five miles and dine with their families, an operator might eliminate spending large amounts of money on direct-mail campaigns that hit homes more than five miles away and assign marketing dollars to promote family dining deals.
Or if a great number of respondents cite fresh, local ingredients as their primary sales driver, an operator can then unveil marketing that showcases the restaurant’s use of locally sourced cheese and vegetables and pursue future locations where that product is similarly valued.
Charles Wetzel, CEO of Buxton, a Texas-based firm that utilizes extensive demographic data to provide market planning and marketing services for businesses, says that understanding the core consumer is a “monumental business step whether you have one location or 1,000.” “Just knowing the basics will help increase the bottom line,” he says.
With solid insights on the core customer in hand, operators can activate more targeted, informed efforts that drive business. For instance, bouncing the eatery’s primary consumer characteristics against entire household files from mailing agencies, such as direct mail companies or national database files (Experian being just one example), allows an operator to screen against numerous variables. “You have the ability to select specific households based on criteria, such as age or income, and to focus on those consumers most likely to drive your business,” Beery says.
To develop the Pie Five Pizza Company, an upstart brand with six locations in the Dallas-Fort Worth area, CEO Charlie Morrison employed Buxton to help Pie Five pinpoint the locations of its first shops. Buxton mapped out major U.S. markets and then highlighted the specific areas that fit the target Pie Five customer, one more likely to visit Chipotle over Taco Bell.
“If you have an opportunity to reach your target customer, then you’re increasing the likelihood that your investment will be successful,” Morrison says. Minus the budget to employ third- party services, Taylor’s gathered much of the demographic information himself to prepare for a second unit.
Taylor started with the “Best of ” lists from outlets such as Forbes, Money and U.S. News and World Report, accessible work that led him to trade areas that are entrepreneurial, food enthused, or favorable to small businesses. Like a detective, he has combed the reports’ footnotes for leads to reports from government agencies, university research, restaurant associations, or nonprofits.
Taylor has then contacted local chambers for additional insights. In many cases, the chambers have tracked down Taylor’s requested data for free.
“I’ve yet to meet a bad one,” Taylor says of the chambers’ helpfulness.
As Due Forni produces a specialty product blanketed in high-quality ingredients, Taylor knows he needs to find the audience that values such culinary exploits. In selecting its flagship Las Vegas site, Due Forni settled into one of the city’s higher- earning demographic areas and near one of the Las Vegas Farmers’ Market’s three locations.
“We need to make sure our target customer is wherever we go … and that they’re interested to invest in what we have,” he says. While it’s easy to be intimidated by demographics, Taylor says a little familiarity goes a long way.
“You can’t assume demographics,” he says. “Do your own digging and get your hands on credible data about your consumer and the area and you’ll be better off for it.”
GETTING TO KNOW YOUR CUSTOMER WITH SURVEYS
While broad-based demographic information, such as household counts and median income, provides telling information, operators and demographic providers alike agree that the Census-like data falls short of providing a predictable story. Accessing information on purchasing behaviors and lifestyle characteristics can inform important business decisions and direct opera- tors down new, more ROI-driven marketing paths.
“If you can dial in further, well, that’s the secret sauce,” Buxton’s Charles Wetzel says.
Key profile questions include:
Where do you live?
How often do you dine out?
What time of day is a typical visit to this restaurant?
What’s your average spend on a lunch visit? A dinner visit?
What drives your decision to more routinely visit a particular restaurant?
Where did you come from before your visit? Where are you headed after?
What conveniences do you most seek from a restaurant?
On a typical visit, how many people are in your dining party?
What do you enjoy in your free time?
What community organizations are you affiliated with?
What might we do better?
Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.
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