December is a vital month for the restaurant sector. Festive bookings and the general buzz around retail means bumper revenue for most. What is the data telling us around this important time of year? Our research suggests it’s vital to concentrate on more than pre-booked corporate parties and consider leisure visitors and gifting opportunities too.
Christmas marketing efforts are well under way for many restaurant, bar and pub groups, with festive emails starting to fill up inboxes from late last month as people sat on the beach on their holidays. Consumers are responding, according to restaurant reservation solution liveRES, with an early flurry of bookings coming through from the end of August, continuing and building from there. They are seeing the peak booking day for December reservations move back year on year, with a trend towards later booking. In 2017 it was 3 December and in 2018 it was 9 December, almost a week later. It’s also worth noting more than two-thirds (70%) of all bookings for December were made during that month. This reinforces what operators are telling us and what we are seeing within our client base. There has been an overall reduction in the largest group bookings, with many companies contributing less towards such events or encouraging departmental Christmas parties rather than whole-company events. This movement is also flowing through to increased informal colleague get-togethers during the festive period.
While pre-booking is important, it’s also vital brands don’t concentrate all their marketing efforts on groups and corporate – there’s a great opportunity in individual bookings at this time of year.
When it comes to the Christmas party crowd the key seems to be having a point of difference, with a lean towards adding entertainment or enhanced experiences rather than straight dining options. Online booking platform DesignMyNight reported the three most searched-for terms on its site in December 2018 were “quirky Christmas events”, “something different Christmas” and “fun Christmas parties” – so it’s worth considering adding emotional hooks to your descriptions and search terms. The most visited venues on its platform last festive period were London Shuffle Club, Flight Club and West End Musical Brunch.
We repeated our test from last year, analysing the average time it takes companies to respond to a corporate Christmas enquiry. We tried to contact five well-known branded venues in London – 24 hours later, we have yet to receive a reply from a single one. At least three venues have dedicated events and reservations teams from what we can see on LinkedIn. It’s not rocket science but to convert business you must respond quickly – consumers expect same-day responses. Before putting your marketing into overdrive on Christmas, it might be worth checking your capacity and systems in managing the enquiries as it’s all very well turning on the taps but if it’s running down the plughole, what’s the point? Sector feedback solution provider Feed It Back surveyed festive guests last year and found the most prominent reason for choosing a venue for a Christmas event was the booker had previously enjoyed a visit to the venue (38%), followed by a recommendation from friends or family (15%). This suggests if you deliver bad customer service to those guests you are putting an already loyal customer offside.
In addition to table bookings during the festive period there’s a lot of opportunity in gifting, with the continued growth in the trend of experiences over things. One of our clients went from a standing start to more than £1.5m in gift voucher sales in one year, with more than half sold in November and December – representing 4% of their overall annual revenue. This is big business. My own experiences show consumers respond much better to experience-based vouchers, with “meal for two” or “cocktails for four” performing equally or better than monetary alternatives. You should almost certainly offer both.
Many hospitality providers are responding to the trend in experiential leisure and competitive socialising by offering their own experiences at their venues, such as cocktail masterclasses and cooking demonstrations. It’s all about offering something a little different yet aligned to your brand – make them searchable and purchasable as online vouchers. You’ll be shocked how many last-minute sales you get on Christmas Eve – perhaps not if your Christmas gift-buying habits are like mine!
DesignMyNight data reinforces this trend, with its vouchering platform Soda seeing a 150% increase in sales in December last year compared with previous months.
With the huge peak in search and transactions around Black Friday and Cyber Monday, consider your plan not just for people out shopping but also those looking for gifts. One client of ours sold more than £200,000 in gift vouchers over this one weekend last year.
Looking around our sector it seems hiring temporary workers has become mainstream, especially in the kitchen, as recruitment becomes increasingly difficult and many chefs choose this route as a long-term option. Christmas is a massive peak for almost everyone in our sector, with increased use of temporary staff. Dawn Redman, chief executive of H&R Recruitment, believes meeting these demands at Christmas is becoming even more difficult, with many of the Eastern European workforce that have traditionally supported our sector leaving the country, heading back home to build on the training and skills they have learned in the UK. She thinks this pinch-point will further reinforce the need for the sector to focus on training, generating home-grown talent and nurturing employees.
The question of a short-term gap in labour and skills will undoubtedly lead many hospitality businesses to re-evaluate capacity at this busy time of year – and it’s likely to have an impact on like-for-like performance for some players.
As you might expect there’s a rise in negative online reviews at this time of year, with customers having higher expectations, the potential embarrassment effect for event organisers among their colleagues, and the added pressure of peak volume on venues. Feed It Back highlights the two key operational areas that drive this negative feedback are wait times and cold food. A lot of these issues can be partially solved through your proposition development and putting the right processes in place, ensuring you know the limit of your kitchens, staggering booking times, communicating with guests on the night, and focusing on additional training ahead of the festive period.
The good news is for brands that get it right, those that make the guest feel loved and deliver a great experience, the evidence suggests festive guests are highly likely to return – it’s a great way to introduce new customers to your business. With this in mind it’s worth considering a mechanism to capture data of the broader guests at the table rather than just the organiser. Also, offer a reason to come back in January – encourage a habit, reinforce yourself as a go-to place sooner rather than later while supporting a traditionally low month with extra covers.
First published in Propel Friday Opinion.