Sponsored by Whirley-DrinkWorks!
When it comes to stirring up traffic and sales in restaurants, limited-time beverage offers have a proven track record. They are particularly effective now with the increased competition from grocery and convenience stores, food trucks and third-party food delivery services fighting for the consumer’s attention and food dollar. Beverage LTOs give restaurant operators a clear edge because they give customers an exciting, one-of-a-kind experience that they can enjoy with their meal.
That was one of the key messages from the third annual beverage marketing roundtable of foodservice executives held at the 2017 National Restaurant Association Show in Chicago. The panelists also shared insights about the optimum duration of LTOs and the value of collaborating with brand partners. The session was sponsored by Whirley-DrinkWorks!, a designer and manufacturer of custom and collectible drinkware for the foodservice industry
Timing is critical
Roundtable participants agreed that managing an LTO requires running the offer long enough for it to catch on with consumers and for training staff to understand and enthusiastically sell it.
“We would not do an LTO for less than three months,” says David Morgan, former vice president of food and beverage for Dallas-based Omni Hotels & Resorts. “We need to tell the story. We need people to understand it. We need to define the time so that it is long enough to really be able to judge success.”
LTOs that last long enough encourage lapsed guests to return and give current guests additional reasons to visit, says Nate Grover, director of beverages at Applebee’s Neighborhood Grill & Bar, part of Glendale, California-based DineEquity Inc. “I think it’s important to look at the pre-promotion period [of an LTO], how long the actual LTO runs and the exit strategy if it doesn't work,” Grover adds.
At Buffalo Wild Wings, a Minneapolis-based casual-dining chain, LTOs allow the brand “to take risks in a calculated way,” says Andrea Benzschawel, director of beverage. “We can either fail fast and get out, or we might hit a home run and add the item to our permanent menu.”
Partnering with suppliers
Benzschawel notes that operators often can increase the impact of LTOs by collaborating with brands of beverage alcohol or nonalcoholic products like tea, coffee and soft drinks. “That creates a synergy of the two brands that is meaningful from a storytelling standpoint,” she says.
An example is a promo that Buffalo Wild Wings is developing with Ole Smoky Whiskey to showcase its mango habanero wing sauce and the distiller’s Mango Habanero Flavored Whiskey. “It’s a perfect marriage of the sweet heat flavor profile that has been successful for us with wings, taken into the beverage category,” says Benzschawel.
Alliances with suppliers of other sorts may be valuable as well. Take the collectible tumbler that Whirley-DrinkWorks! designed for an LTO by McAlister’s Deli, a fast-casual sandwich chain based in Atlanta. Guests who purchased the $8.99 tumbler — designed to highlight the chain’s signature Famous Tea — were invited to return with their tumbler and enjoy 99-cent refills. In addition to generating over 9 million Facebook impressions, 3.6 million Tumblr impressions and 7,300 new email subscribers, the promotion generated almost three times as many refills. After the promotion ended, it sustained almost the same level of refill activity through the end of the year.
“Our guests love to Instagram our 32-ounce cup [of Famous Tea],” says Jessica Osborne, director of brand marketing at McAlister’s. “Our biggest promotions or contests on social media involve taking a picture of yourself with your tea.”
For Omni Hotels & Resorts, customer education is an important aspect of the most successful LTOs — the chain's flavors of the world campaigns, says Morgan. An example is a recent three-month promotion of the wine and food of Spain’s Rioja region. “That kind of appreciation for learning gained us some loyalty,” says Morgan.
Mellow Mushroom, an Atlanta-based casual pizza chain, has changed course on LTOs. “This year we are going to do some seasonal LTOs on items that are already on the menu and that we know are well liked and easy to execute rather than develop brand new products that run the risk of falling short”, says Eric Brown, director of beverage innovation and operations.
“From my experience, the beverage promotions that have done really well are those that the system gets excited about in advance,” says Grover. “Marketing and internal buy-in are critically important, just as much as the beverage that is being served to the guest.”
Morgan sums up three potential outcomes of a successful LTO: positive public relations impact, higher profits and engagement of service staff. “Sometimes you hit one; sometimes you hit two; sometimes you hit all three. But if you can hit one of those, it’s a good thing for the team and your business,” he says.