Mental Anchoring, Do It And Get Higher Check Averages


A number of years ago I came across some research done by American Demographics. And at first blush it seemed more amusing than anything. According to the research, the one time people are most likely to spend the most money at a restaurant is the day they buy their home. The thinking is: “I’m already $300,000.00 in debt. What’s another hundred bucks?” So they order a more expensive food item to celebrate.

All by itself, that bit of information may not seem all that impressive. Plus, it’s not very often that people buy homes even in good times, not to mention our current economy. However, when you couple that bit of information with the fact, and it is a fact, that the hardest item to sell on any menu is the most expensive item ... then it becomes valuable. So if the steak and lobster is your highest-priced item, it sells less than many of the other items on the menu. And in many cases, it sells dead last.

Here’s the rub, though. It’s probably the single item in your restaurant that offers the best plate contribution. Plate contribution being the total dollars a given item offers the bank. Many restaurant operators get hung up on food cost percentages, and while that’s somewhat important, in the big picture, what really matters is increasing your revenue per available plate sold.

Now here’s how this can help you: just by offering an arbitrary item on your menu that is more expensive than the currently most expensive item, you will get a substantial lift in sales of the most expensive item on your menu. So if you just take the most expensive item and double the order for twice the money, the single order will suddenly start to sell. And the cool thing for you is the most expensive item on your menu is, in all likelihood, your best potential to increase your profit potential.

Victoria house didn’t embrace the idea either, so I used the center-cut pork T-bone and BBQ ribs to help mental anchor. Victoria House had two sizes of ribs to begin with, and they already offered single and double pork chops, so by adding a rack and a half of ribs for 31.99, and triple pork chops for 27.99, we were able to take some of the down-pressure off the higher price points.

Views: 4

Tags: developement, marketing, matrix, menu, pricing, restaurant

Comment

You need to be a member of FohBoh to add comments!

Join FohBoh

Comment by Mark on January 20, 2010 at 8:27am
Thanks Paul - it does work on its own, but you're exactly right, it also helps to have the servers promote it, too.

Non-Operator
Comment by Paul Paz on January 20, 2010 at 4:20am
Interesting strategy.
This would require educating the staff on this strategy... unless of course it works all by itself. Restaurant FOH marketing and sales training is notably absent in most restaurants other than making sure the SOP steps of service include the banal ivitations to alcoholic beverages, appetizers, and desserts.
Again, interesting strategy.
Paul

Advertisments

 

DEPARTMENTS

Social Wine Club for Craft Wineries

Smartbrief

Eateries turn to rationing as lime prices soar

Unrest caused by Mexico's drug cartels, along with floods in Mexico and a drought in California, are taking a toll on this ye -More

25% Usage Reduction, Guaranteed!
Reduce waste and cut cost. Impress your customers and express your brand. Every single Tork Xpressnap napkin dispenser performs double-duty for your business. Find out more about our 25% usage reduction guarantee or get a free trial.

Burger King to upgrade wireless with Whopper Wi-Fi

Burger King has teamed with AT&T to replace existing in-store wireless Internet with an upgraded system dubbed Whopper Wi-Fi  -More

Late-night indulgence pays off for Jack in the Box

Jack in the Box saw its profits rise sharply in the first quarter, a few months after introducing its $6 Munchie Meal menu of -More

JOBS & CAREERS

Posting a job or finding a job starts here at FohBoh. Call us about special $25 posting packages to syndicate across all major jobs boards.

National News

Chipotle Mexican Grill, Inc. First Quarter 2014 Revenue Up 24.4%

Comparable restaurant sales increased 13.4% - Restaurant level operating margin was 25.9%, a decrease of 40 basis points

Jamba Juice Announces Grand Opening of New St. Louis, MO Location

Jamba Juice Company announced the brand’s continued expansion in the St. Louis market with the opening of a Jamba Juice® store at 11477 Olive Blvd. on April 16, 2014.

Expert in Real Estate Analytics Joins Luna Grill

Luna Grill, the San Diego-based Mediterranean restaurant chain, is welcoming retail real estate industry veteran Greg Thorburn to its leadership team. Thorburn has been brought on board to fill the newly created position of Vice-President of Real Estate.

Rita's Italian Ice Awards Area Development Agreement for Kansas

Rita's Italian Ice has awarded franchise and area development agreements for Kansas and the Kansas City area, which extends to the Missouri side of the city, to franchisees and local residents Jay Miller, Jeff Miller and Pat Reilly.

Restaurant Sales Bounced Back in March

Restaurant sales posted a solid gain in March, and bounced back completely from the recent soft patch. Eating and drinking place sales totaled $47.3 billion on a seasonally-adjusted basis in March, up 1.1 percent from February's upward-revised sales volume of $46.8 billion, according to preliminary figures from the U.S. Census Bureau.

CROWD FUNDING

If you are looking for capital to start or grow your restaurant, create the next 501c3, develop and launch the next app for the restaurant industry,or want to help your peers in some meaningful way, we want to know about it.

TED TALKS VIDEO

TED: Jeremy Kasdin: The flower-shaped starshade that might help us detect Earth-like planets - Jeremy Kasdin (2014)

Astronomers believe that every star in the galaxy has a planet, one fifth of which might harbor life. Only we haven't seen any of them -- yet. Jeremy Kasdin and his team are looking to change that with the design and engineering of an extraordinary piece of equipment: a flower petal-shaped "starshade" that allows a telescope to photograph planets from 50,000 kilometers away. It is, he says, the "coolest possible science."

TED: Norman Spack: How I help transgender teens become who they want to be - Norman Spack (2013)

Puberty is an awkward time for just about everybody, but for transgender teens it can be a nightmare, as they grow overnight into bodies they aren't comfortable with. In a heartfelt talk, endocrinologist Norman Spack tells a personal story of how he became one of the few doctors in the US to treat minors with hormone replacement therapy. By staving off the effects of puberty, Spack gives trans teens the time they need. (Filmed at TEDxBeaconStreet.)

TED: Jennifer Senior: For parents, happiness is a very high bar - Jennifer Senior (2014)

The parenting section of the bookstore is overwhelming—it's "a giant, candy-colored monument to our collective panic," as writer Jennifer Senior puts it. Why is parenthood filled with so much anxiety? Because the goal of modern, middle-class parents—to raise happy children—is so elusive. In this honest talk, she offers some kinder and more achievable aims.

TED: David Brooks: Should you live for your résumé ... or your eulogy? - David Brooks (2014)

Within each of us are two selves, suggests David Brooks in this meditative short talk: the self who craves success, who builds a résumé, and the self who seeks connection, community, love -- the values that make for a great eulogy. (Joseph Soloveitchik has called these selves "Adam I" and "Adam II.") Brooks asks: Can we balance these two selves?

© 2014   Created by FohBoh.

Badges  |  Report an Issue  |  Terms of Service