
I've been thinking a good bit about the comment by the anonymous owner of the other meal assembly kitchen concept store regarding
my Let's Dish post on Thursday. He asked, and rightly so, if Let's Dish had been such a well-run operation, then why did it fail?
First, please allow me to clarify. I can only comment on the customer experience. After all, I'm only (was only) a customer. Therefore, my post was based on my experience. And to Julie and me, the Let's Dish operation ran smoothly.
Let me also state that my post was about the
operation — not sales and not marketing. While the brand experience is what customers remember (operations), it's the brand
promise that gets them in the door. And there was considerable room to improve the Let's Dish brand promise.
To answer the anonymous comment(er), I can only comment based on some assumptions. So here goes.
It appears Let's Dish Corporate gives its franchisees the ability to set their own prices. From what I can tell, the pricing varies from location to location nationally. Therefore, the Kansas stores had the ability to raise their prices, if they chose to. Julie and I would have easily paid 20% more for our meals from Let's Dish. We were comparing the Let's Dish costs to the grocery store. When we considered the waste factor of food going bad from the grocery store, Let's Dish was more economical.
There was no check-out process at Let's Dish. The two stores we frequented relied on the honor system for preparation, packaging and walking out the door. While I'm confident most of their customers were honorable, I know a percentage of them were not. Occasionally the Let's Dish staff would comment about food disappearing too quickly from the preparation stations. They knew how much they needed for the customers scheduled, yet occasionally they would have to re-stock earlier than anticipated.
A small percentage of shrinkage can have a huge impact on the bottom line because it's coming right out of costs of goods sold, which is a direct hard cost to the retailer. A simple check-out process where the Let's Dish associates did a "Okay, let's make sure you got everything you were supposed to tonight" would have been all it would have taken to slow down the shrinkage. If people know there's a check-out process where they may get caught with an extra steak, then they'll likely avoid the risk.
Loyal customers are the best source of new customers. While I don't know enough about the company or their margins to make a tight recommendation, I do know that Let's Dish had a number of loyal customers. They needed to find ways of getting those customers to tell the Let's Dish story and bring new customers to the store.
Make the Let's Dish Monthly Newsletter offer compelling — and available for advocates to subscribe. If you visit the Let's Dish Web site, you'll see the lazy offer of "Yes. Send me the Let's Dish monthly newsletter." First, when someone is signing up for their first Let's Dish experience on the Web, the last thing in which they're interested is getting more junk email in their In Box. Once someone has become a customer, especially a loyal customer, then they might be interested in receiving the monthly newsletter. But only if 1) the offer was compelling. Tell me what I'm going to see in this amazing newsletter. Give me a reason to want to receive one more email in my In Box and 2) the compelling offer for the monthly newsletter was in the store. The store has all kinds of opportunities to tell stories to their customers. There are menu cards for the coming month, there are refreshment areas, there are the apron and hand washing areas — any of these could have had a compelling message about why I should receive the monthly newsletter. But that did not happen at Let's Dish. There's no effort to connect Let's Dish advocates with the company to make it a deeper customer experience. Too bad. Because while Julie and I helped at least ten different people become Let's Dish customers, I'm guessing there were many other customers who would have been happy to if they had been given just a little direction on how to do so.
In store merchandising to existing customers. If existing customers are the best sales people, then give them a reason to bring others to Let's Dish. The national Let's Dish franchise system does not have enough critical mass to mount a significant advertising or promotional effort. The company must rely on initial publicity and subsequent word-of-mouth and referrals to keep it going.
There are a number of guerrilla tactics that could be implemented within the store to help 1) incentivize existing customers to bring new customers or 2) just nudge existing advocates by planting the idea of bringing friends to Let's Dish. Hold Let's Dish birthday parties for a girlfriend. Have a Girl's Night Out at Let's Dish. Charge a catering fee and actually feed the guests some Let's Dish meals while they're there. After the initial volley of publicity when the two stores in Kansas opened, there was no buzz whatsoever. Nothing. I don't know if this is an indictment of the local owners or the national franchise. It doesn't matter. It didn't happen and the stores are gone.
Create promotions with existing customers. Let's take the previous idea a bit further. Hold an event quarterly where you ask your best customers to each bring two of their friends to a Let's Dish catered evening at the store. It's our experience that once someone begins "Dishing," they continue to come back. Close the store for an evening once per quarter and introduce the concept to twenty or thirty new people. It's not hard to calculate the metrics on what numbers would have to be achieved. But a $5,000 evening that introduces 30 new people to Let's Dish beats putting $5,000 worth of advertising in the local paper or on a direct mail campaign. Let the advocates tell the story to their friends.
Advertise on Google. I just looked to see if any of the competitors in this category are using Google AdWords to drive traffic to their sites. No one is. The best I can tell, not a single competitor is using the Web to drive customers to their Web sites. That means 1) there isn't enough margin in this business for Pay-Per-Click to work (and that's really hard to believe) or 2) no one has exposed these national corporations to the Pay-Per-Click idea or 3) these companies are not sophisticated enough to try it or 4) they did try it and it didn't work financially or 5) they have not figured out how to put together market plans to help their franchisees roll out their own online marketing efforts.
That's a lot of "ifs." I'm just surprised no one is doing it. It could be the concept is still too new, but I doubt it. This is a concept designed for people in a hurry with limited time to prepare meals. The Let's Dish customer is Web savvy. They have to be since they must sign up for and pay for their sessions on the Web. Why doesn't the company advertise on Google?
In any organization there's always room for improvement. But to the anonymous commenter, if you have loyal customers in your kitchen meal assembly business, then they're your best source of new customers. Become intentional about finding opportunities for your advocates to introduce new customers to your business. Then, make sure you have the systems and procedures in place to maintain these programs year after year.
In most businesses there are only a handful of marketing ingredients that need to be part of the mix. The challenge is identifying the ones that will help bring new customers while encouraging existing customers to purchase greater quantity and more frequently. When you identify the right recipe, then your business will really start cookin'.