The Words Matter in “Word of Mouth”

I think every restaurant consulting firm would agree that you get new customers and keep great ones via word of mouth.  What can be argued, ad infinitum, is how to define “word of mouth” nowadays.  Is it a rant posted on a review site?  A Facebook entry? A tweet about the “best veal ever” or a comment from a co-worker over a drink? It’s all of these things and others, though I leave it to the experts to decide which avenue is more “viral” and “sustainable” (two terms I wouldn’t mind never hearing again).

The importance of word of mouth in today’s world was on my mind during a recent Cornell Hospitality Research Summit, where Hudson Riehle of the National Restaurant Association presented practical insights for restaurateurs, buttressed by sobering restaurant data.  Restaurant-goers will remain cautious on spending, he said, because their confidence is heavily dependent on “cash on hand”, otherwise described as their discretionary war chest.  Unfortunately, a big part of cash on hand is the value of home equity, which has declined in every North American market. 

Meanwhile, full-service restaurants  (in which guests pay after they have consumed goods and services) are also facing a changing competitive landscape where 70% of traffic is now considered “off-premise.”  In fact, this is where the lion’s share of growth is.  Although this may mean pent-up demand for full-service restaurants, it’s also clear that a well-constructed, take-out program that still delivers high guest satisfaction is a fait accompli for upscale restaurateurs who wish to stay competitive.

How do restaurateurs capture and maintain true market share amid these, and other, challenges?  Let’s get back  to word of mouth.  No matter in which venue word of mouth appears, it’s engendered by a consistently good product.  Even so, on a scale of 1 to 10 (where you need a 9 or 10 before customers spread the word), a consistently good product will only get you somewhere between a 5 and an 8.  Even with good food and good service, you’re still plumbing the depths of 5s, 6s and 7s.

What you’re looking for are rave reviews . What turns a so-so review into a rave?  We asked 2,500 consumers to rate their last restaurant experience along with their likeliness to recommend that restaurant on a scale of 1 to 10.  We found that in all dining segments, food remains king, but it is how people describe that food that makes the difference between a 7 (so-so) and a 9 (a rave).  The adjectives they use to describe food, service and atmosphere provide the clues operators need to turn the average into the superlative.  

Stayed tuned this week for more blog entries detailing the results of Coyle’s latest research to learn, straight from the consumer’s mouth, what they are saying, posting and tweeting.  And to further explore the ways restaurateurs can use twitter to track what clients say about their businesses, see our recent blog post by Alex Failmezger, Food Trucks Teach Value of Twitter.

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