Pizza Business, Pizza Marketing, Pizza Profits

When it comes to pizza business, it’s interesting to see how some marketing ideas and methods get spread around in a particular locale. Also, it’s interesting how the challenging economic environment forces some shops to play in the “gray” area.

Here’s a recent example.

I’m in Ottawa this weekend, where my son is playing in a hockey tournament. It’s 5 PM and we don’t have any more games tonight. So he’s off to the “water park” with the other boys and I’m back in the hotel room, online with my laptop.

20 minutes go by and I hear a sound of a piece of paper being shoved under the room door. I pick it up and see another one lying near by, which apparently got in the room earlier the same way. Both are fliers for the local pizzerias.

Apparently, one of the local operators has figured out a way to boost their pie sales (at least temporarily, until the hotel figures out their game and cracks down on them.) Their marketing approach is simple: They walk into a hotel with a stack of pizza fliers under their jacket and walk around the floors, showing those fliers under the room doors. It’s a speculation but I suspect they look for a sign of the room being occupied (otherwise the manager of the hotel would be dealing with a lot of aggravated maids and would so much more inclined to put an end to this pizza marketing gambit.)

Both fliers are not very good from the copywriting point of view. One looks like a bill of good or a shipping slip, with the menu items listed on the left side and the corresponding prices on the right. The other one is significantly more elaborate and uses full-color graphics of both sides, with pictures of food and tear-off coupons. They will find a place in my “swipe” file but they certainly don’t deserve much attention in this article.

Several thoughts are going through my head right now as I think about this event:

• It’s interesting that I have not seen this “guerrilla” pizza marketing method used in other cities — and I travel a lot.
• It’s also interesting that the two local pizza businesses are engaged in one-upmanship of each other. This goes to show that most restaurants (including pizzerias) plagiarize the marketing methods of their local competition and rarely, if ever, bother to research the tactics successfully employed in other parts of the country or other countries.
• I’m very curious to know if the hotel manager and the concierge are in on that. Alas, there is no simple way to find out, and my first name is not Sherlock. (My guess it’s a “yes” for the concierge and a “no” for the manager who’s probably being kept out of the loop.)

Action is what produces results. The two pizza operators (who will remain nameless) are taking action, and that is admirable.

The only issue here is their method of marketing, which is short-sighted and will produce the results that are short-lived:
- They are targeting hotel guests who are here today and are gone tomorrow, so it’s virtually impossibly to turn them into repeat customers;
- The hotel is eventually going to take a note of this activity and will try to put an end to it (say, by pressing littering charges);
- They are upsetting the hotel management and are closing the door shut on a potentially profitable joint venture opportunity with this hotel.

Very opportunistic on the part of these two pizza businesses. And that may get them in fair bit of trouble and wipe out all the profits they manage to create this way.

These is a smarter and better way to work with local hotels, turning them into your allies and ensuring continuous profits for many years to come. Next time, are going to discuss how to set up a profitable joint venture with hotels and how to do that the right way.

In order to know how to better sell a product, you need to understand how people buy it.

Pizza is an interesting product. Very unique. And also very ubiquitous (sorry, I was looking for a “u”-word, so that one will have to do here.)

Pizza is usually an impulse buy. Very few people have “buy a pizza” as a task in their desk calendars and Blackberries.

It’s also a convenience buy. The “pizza buying process” usually looks like this: Mom brings Little Johnny home from his soccer practice. It’s late and there is nothing in the fridge. She doesn’t want to cook after the long day. He’s starving and, given a chance, could eat the whole elephant.

Mo-o-om! Can we get some pizza?

Bingo! She calls a pizza place and a hot pie is at the door in less than 30 minutes.

Now, which pizzeria is she going to call?

Most likely, it’s going to be the one which telephone number is handy. Flipping through the Yellow Pages and going online are both good options and that’s what millions of people do all the time. Both of these marketing media you should not overlook.

However, what if you could create something that is more “in their face” and has some “hanging around” quality to it?

Real estate agents are known for giving away custom calendars with their contact details on them. Since they keep printing and gifting those, we can conclude calendars work at least for some of them.

What if you printed out some calendars for your pizzeria and gave those away to your best customers? These are very likely to work great for you.

Here’s why:

• Calendars end up on the fridge door or the entrance door and get looked at many times every day.
• If you use professional photos of your food, these can create a craving big enough for them to want a pizza.
• Calendars are inexpensive. You can get 1000 of those printed for just around $3 a piece (As of this writing, that was the quote at www.PrintCalendarsForLess.com. Use coupon code “RP177777″ to get $25 off your order.)

Now you need to consider who should be receiving the calendars from you. Someone who came for the first time and bought a slice may or may be a good target to give a calendar to. On the other hand, every “regular” customer should receive one.

And oh, the best part: Chances are, no other pizzeria in your area is doind this type of marketing so it’s super-easy to stand out.

In speaking with restaurant owners, it seems that about 25% of them have been in business for less than 12 months. Given that the overall number of restaurants doesn’t dramatically change year over year, this tells me that about one out of four restaurants will not be around 12 months from now. And with the economy the way it is, this number may get even bigger. 

However, even in the worst of the times, there are plenty of people wanting to get into the restaurant game. So the question becomes, are pizza businesses better positioned to sustain sales and possibly grow during the slowdown than other types of restaurants?

According to the MasterCard research, restaurant sales were slightly up last month with fast food yielding the biggest gain of about 1%. This is great news for a lot of restaurant folks, given the bloodbath still going on in the financial sector, real estate, and many other corners of the economy.

Alas, MasterCard people didn’t say much about pizza. I venture to say, pizza as a segment is probably outperforming many other types of cuisine. And most likely, it will continue to do relatively well as far as we can see.

The rationale is simple: To a consumer watching their food spending and scaling down on their eating out, pizza looks like an inexpensive alternative that is welcome in most homes and on most tables. 

Come to think of it, pizza is fast food without much of the fast food stigma. Who would want to order eight Big Macs to feed the friends that paid a surprise visit? KFC’s family combo “bucket” doesn’t seem like a good idea either. Yet pizza is socially acceptable and even attractive to a very wide demographic.

All that is not to say you are guaranteed smooth sailing if you own a pizza business. Far from it. The old pizza marketing methods are no longer effective. You are going to continue to feel a squeeze on your margins. Becoming smart about your pizza business and pizza marketing is ever so important.