Competitive research is the process of analyzing the weaknesses, strengths, and product offerings of other companies. The benefit of researching potential competitors in this manner allows you to understand what your company is going up against, and how your product or service provides unique value.
Restaurant businesses and foodservice operations exist in a highly competitive market, and market research is crucial to their success and survival. When opening a new establishment or going through the research and development process, the competitors in your geographical location must be examined. On top of this, customer demographics should be analyzed to ensure there is a market for your offerings.
A well-thought-out marketing plan always contains competitive research, and this is true throughout most industries. However, because the restaurant industry is so competitive, it is especially key. Think about how many restaurants in the U.S. and Canada are vying for the same customers; knowing how you are going to stand out and win customers is what will set your restaurant apart from others.
Unfortunately, restaurants that fail to conduct competitive research will lose out on business and potential customers. You need to know how to best serve your customers in your target market as multiple competitors are trying to do the same. With such tight profit margins, restaurants cannot afford to lose out on business.
After conducting due diligence for your business plan prior to opening, competitive restaurant market research is required to continue to stay relevant. Tracking online reviews, food critic commentary, and social media accounts are a few key metrics to track for your own restaurant. However, you should be doing this for your competitors as well.
Did a customer leave a bad review about your enchilada entree, but your competitor’s enchiladas are its best-rated dishes? Reviews are a valuable way to gain insight into what is and isn’t working for your customers. If your competitor is doing a better job at serving customers, you need to be aware of how you can improve. You don’t need to copy your competitors, but you can learn from what they are doing well, and what they could improve upon.
Does the bakery down the street have an out-the-door line every weekend, but yours only sees a slow trickle of customers? If your pastries and coffee are of the same quality, this may be proof that your competitor is doing a better job of advertising.
In short, the more information you have on competitors, the better prepared you are to conduct competitive research and development. Although Restaurant market research can take time, effort, and money, it is key to long-term success. One way to reduce the time and effort spent on research is by gaining access to relevant and up-to-date restaurant data.
How do you stay current on new competition entering the market? Or, changing customer preferences and industry trends? The answer: on-demand, up-to-date restaurant data.
Relevant restaurant data gives owners, operators, and restaurateurs detailed insight into the current market and industry trends, allowing them to make informed business decisions and keep a competitive edge.
What type of data is helpful for the research and development process?
As a restaurant owner or operator, you may have already done due diligence on your competitors in the area. When new competitors enter the market, or when businesses begin offering similar products or services, you’ll want to know right away. This ensures that you know how to position your new offerings, and fill in any of your competitor’s gaps.
Food trends come and go – some last (like veganism), while others are short and fleeting (like cake pops and rainbow bagels). While you don’t necessarily need to be on top of every food trend that pops up, it can be helpful to be aware of them to remain relevant and know what your competitors are up to. Market research results, industry journal reports, and data can give you key insights into upcoming trends. This type of research allows you to take advantage of trends when it makes sense for your business, and when it is most likely to be profitable.
When your business is involved in the R&D process, and developing new menu items, products, or services, you need to be aware of what businesses in your area are already offering. Maybe four businesses in your area already offer stellar tacos, but currently, there isn’t anyone offering vegan or vegetarian options. If several nearby restaurants have the same cuisine as yours, what can you offer that they don’t have? This could be your opportunity to offer a happy hour or special brunch.
Consider for a moment how many restaurants in the U.S. and Canada are similar, and offer nearly identical menu items.
A restaurant client of Brizo desires to examine other restaurants that use similar ingredients to them. With this restaurant market research, the client plans to be able to go through the R&D process, and extend their ghost kitchen operations with these additional concepts. By taking inspiration from concepts that use similar ingredients, the restaurant business is able to simplify BOH (back-of-house) operations, maximize profits, and reach new customers via new concepts.
With increasing competition, shifting customer demand, and evolving trends, the restaurant industry is constantly changing. In order to stay competitive and achieve long-lasting success, businesses must take advantage of relevant restaurant data for competitive market research and the R&D process. Brizo Foodmetrics offers access to 500,000 data sources, with three unique scores for over 1,200,000 eating and drinking establishments. Despite how many restaurants are in the U.S. and Canada, access to data like this allows businesses to conduct competitive restaurant market research to maximize their strengths and minimize their weaknesses.