Article | August 18, 2021
The term "Horeca" is an abbreviation of "Hotel", "Restaurant" and "Café". It represents a very diverse sector, i.e. from star-restaurants to catering and canteens to brasseries up to small, local cafes. A small country like Belgium counted end 2017 almost 60.000 horeca-enterprises (7% of all Belgian enterprises), thus showing the importance of this sector. Furthermore with a total revenue (also end 2017) of over 15 billion EUR and more than 75.000 people employed in this sector, it remains an important economical actor for the Belgian economy.
It is undisputable that the Covid crisis has been a disaster for this sector. However, now that life gradually returns back to normal, it is likely that the trends which were already launched in the horeca sector before the crisis will be even enforced and accelerated.
With new habits come new customer needs related to the horeca. Think about the company canteens. With more people working from home, this sector will have to reinvent itself. Most likely they will start offering also prepared meals directly to consumers via supermarkets and other distribution channels. Obviously, this will force other actors in this market to reinvent themselves, thus launching a chain reaction.
Even more pronounced is the impact of take-away and delivery. While a large group of the population was still a bit hesitant to consume take-away, the Covid-confinements also forced this group to start exploring these new services. At the same time, restaurants which were not offering take-away services before were also forced to adapt. As a result, take-away and meal delivery services have known an exponential boost and this trend, although it will know a small set back when the pandemic is fully over, is here to stay.
Unfortunately the horeca sector was already a sector with a lot of difficulties before the crisis. The sector historically copes with one of the highest percentages of businesses bankruptcies , especially when looking at the first 5 years following the establishment of the business. This is often caused by the fact that many people consider the horeca as an easy way to entrepreneurship, founding their businesses with a poor of even no business plan. At the same time there is of course the strong dependency on labor. As this sector is very labor intensive, margins are low due to the high labor costs. Furthermore with hard work and irregular and long working hours, horeca businesses have more and more difficulties to find motivated and qualified personnel. Additionally the sector, being so fragmented, often lacks professionalism, not really for the horeca-activity (i.e. the preparation and serving of food and drinks) itself, but rather for the supporting activities like financial management, supply chain management (like good stock management), procurement… This makes that many restaurants have a poor view on the breakdown of their costs and revenues, thus losing a lot of money in inefficiencies like expired stocks due to too large ordering, certain dishes which are not sold at the right price, employees being paid too much expensive overhours, bad negotiations with suppliers…
Apart from the above very obvious trends, there are still a lot of other trends. These map perfectly with the 8 universal trends, I described in my earlier blog "Universal trends - Common over all industries?" - https://bankloch.blogspot.com/2021/01/universal-trends-common-over-all.html, i.e.
Pressure on margins: margins are historically already low in the horeca sector, but are becoming even more under pressure, due to new forms of competition, like meal boxes (like HelloFresh or Foodbag), prepared meal services (like Mealhero), sharing platforms (like Thuisafgehaald or Menu Next Door), virtual restaurants (also called Dark Kitchens, i.e. restaurants without a physical location, but only serving online delivery platforms), living room and concept restaurants… This forces restaurants to work more professionally and efficiently and find a specific niche (of clientele willing to pay extra for specific product or experience). These efficiency gains can be achieved via digitalization (with regards to personnel management, cash register, stock management…) and new technologies (like 3D printers or cocktail machines like "Tenderone", "Bottletender"…), but also by being more selective on opening hours/days (especially for weekends and holidays), putting less (more specialized) choice on the menu card, making dishes less complex by investing more in the quality of the ingredients, by pushing more self-service (e.g. let the customer cut the food for the whole table, which has as a welcome benefit that it increase the customer experience).
Trustworthiness: clients must have confidence (trust) in a horeca place they are visiting. Obviously, the customers must have the feeling of being treated fairly and respectfully (e.g. via a transparent and correct pricing), but they also want to be able to trust the product they are consuming (eating or drinking). This means providing more transparency, like providing more info about each dish and more its ingredients (important for specific diets and allergies), nutritional value and origin of the product (i.e. farm-to-table).
Frictionless experience: the customer experience should be at pleasant as possible, meaning any friction should be removed where possible. This consists of frictionless ordering processes, via digital menu cards (providing details of each dish and allowing easy filtering) and direct ordering (directly to the kitchen), all the way to a frictionless checkout, consisting of digitally receiving and paying the bill. A multitude of solutions are available here, like full ERP solutions for horeca businesses (like Apicbase, Horeko, Square for restaurants, HorecaMakers, Growzer…), digital menu card solutions (like Kimeru, Digital Wizards, Futuresto, EasyButler…), ordering terminals and apps (like Futuresto, EasyButler, MyOrder, QCard, PayMyTable…), cash registers (like Lightspeed, RestoMax, Gastrofix, HorecaMakers…).
Personalization: the most important trend for the horeca is obviously the personalization. This results in products and services adapted to the specific needs and desires of every customer. Additionally horeca businesses are being converted more and more into "Experience" places (i.e. surprise your customers, by selling them moments and letting them escape from the stress of day-to-day life), i.e. ensure to give the customer a unique, unforgettable experience, not only via the food and service, but also via the texture and color of the dishes, the building, the interior design…
More in detail this trend means:
New types of restaurants, like living room restaurants (enforcing a more personal touch and home feeling), concept restaurants, food markets, pop-up restaurants…
Accommodating for different food and drink choices. Already around 20-25% of people have a specific food choice, meaning restaurants have to accomodate for people wanting to eat vegetarian, vegan, lactose-free, gluten-free, halal, kosher, paleo, biological… Additionally people want alternatives for the traditional wine-card like different types of water, mocktails, non-alcoholic wine, champagne and spirits (e.g. Seedlip), luxury soft drinks (e.g. Crodino, Finley, Pinky Rose, Fentimans & Fritz-Kola) or special types of tea to drink the meal.
Horeca places should become places to socialize, i.e. provide a home-feeling (i.e. a feeling of comfort, stability, trust, intimacy, warmth…), engage socializing between guests via guest tables, street food or sharing plates…
Allow customers to compose their dishes themselves, cfr. Subway, Hawaiian Poke Bowl…
Democratization: by working more efficiently, more automation and digitalization, it becomes possible to offer certain services and products in higher volumes and at lower costs and thus at a lower pricing. This means certain horeca products, which were before only available to the happy-few cannot be offered to a larger segment of the population. A good example are star-restaurants offering a standardized (simpler) version of their dishes via a take-out or catering service.
Authenticity: restaurants are focusing more and more on providing an authentic experience, e.g. by transforming old factories or churches to restaurants, integrating open kitchens where guests can see the cooks preparing the dishes, chefs finishing plates at the customer’s table… Additionally there is a trend towards pure, simple and honest, meaning natural, artisanal and/or high-quality products (ingredients), which are prepared and served in a simple way. A good example of this are also the traditional dishes in a more luxury fashion, e.g. new types of éclairs (Chez Claire), croques (RemorK), hamburgers (Ellis Gourmet burger), meat balls (Balls & Glory)…
ESG (Environment, Social and Corporate Governance): with customers being more sensitive about the environment and society, horeca places need to accommodate to this customer desire. Restaurants are working more and more with local, healthy (e.g. use of superfoods, use of less salt and fat…), biological/organic and Fairtrade products, but also with products with a lower ecological footprint, like e.g. replacing meat with insects, soya-based meat replacements or vegetables. Additionally horeca players need to avoid waste, via a no-waste kitchen concept (via e.g. smaller portions, trash cooking, creative usage of waste…), via anti-food-waste platforms (like Too Good To Go) and by reducing/avoiding packaging (e.g. avoiding plastic straws, cups…).
Partnerships: as many businesses, a horeca business is more and more integrated in a concept, like incorporated in a shop or combined with an experience (like a horeca place in a brewery). Additionally due to the digital revolution, horeca places need to partner more and more with online ordering and delivery services (like Deliveroo, TakeAway.com or UberEats, potentially integrated via Deliverect), social media (like Facebook and Instagram) and food review platforms (like Yelp, TripAdvisor, Zomato, Foursquare…), reservation platforms (like TheFork, Tablebooker, Resto.be…) ordering and payment apps (like Dorst.app or Yummy.app). Additionally new players are coming on the market to help horeca businesses with their typical problems, like procurement (e.g. Tippr or Horeca Direct Shop) or recruitment (e.g. Mise en Place).
It is clear that although the horeca sector is already centuries old, it is also undergoing major disruptions. In the end let us hope that all those evolutions can give us an even more enjoyable horeca experience.
Article | March 2, 2020
Facebook marketing has both grown and morphed into different forms over the years, but it has remained powerful. Small businesses can take advantage of the same audience that big companies have through Facebook marketing. As of 2020, there are 1.69 billion users on Facebook, and around 1.3 billion users on Facebook Messenger. Being able to tap into that market can turn your small business from an obscure donkey to a powerful unicorn. If you’re looking to up your game this year, here are seven Facebook marketing trends entrepreneurs should be aware of. Customers prefer being able to interact with businesses that can respond immediately round the clock.
Article | August 18, 2021
Each business endeavor begins with a well-defined business plan and, more crucially, a marketing strategy. An effective marketing plan is chock-full of different marketing selections for your firm and is a must-have if you want to get to your destination. But, unfortunately, the market is full of competition and uncertainties.
It is estimated that about 20% of small businesses fail in their first year as per the US Bureau of Labor Statistics. After five years, 50% fail, and after ten years, 80% fail.
Here are a few ingredients of a marketing plan that help you outshine in the diverse and competitive markets.
A marketing plan is the first stage in establishing a successful marketing program. In addition, a marketing strategy serves as a road map for efficiently allocating precious time and resources to prevent wastage.
A marketing plan includes a written document that describes an organization's advertising strategy, marketing techniques, tactics, promotional activities, and marketing efforts over a specific time.
Market research, SWOT analysis, thorough information about its target consumers, competition positioning in the market, marketing plan budget, target market profile, distribution methods, promotional tactics, and marketing objectives are just a few of the ingredients of a marketing plan.
Importance of Marketing Plan
A marketing plan is vital because they make sales easier for any small business owner. When you target your ideal target customers, you increase the chances of generating leads and converting them into sales.
Below is a few more importance of marketing plan:
It aids in the effective management and accomplishment of your business objectives
It facilitates cross-departmental collaboration and communication
It contributes to the avoidance of future dangers and uncertainties
It contributes to the success of marketing activities
It contributes to reducing the chance of failure
It enables the efficient and prudent use of resources while taking market opportunities into account
Extensive Market Research
Market research is one of the crucial ingredients of a marketing plan. Market research is the act of collecting and analyzing data to have a better knowledge of your consumers and the current state of the market.
For marketing success, you must conduct a SWOT (strengths, weaknesses, opportunities, and threats) analysis compared to your competitors and a PESTND (political, economic, sociocultural, technological, natural, and demographic) analysis to better understand your competitors business's operating environment.
Marketing research involves certain areas to be given utmost importance:
The dynamics and trends of the market, including seasonality
Vendors in whom you will place your trust
Demographic information about customers, market segmentation, target markets, product needs, and purchase decisions
What is presently available and what competitors are providing
Current industry sales
Robust Market Strategy
The marketing strategy is the overarching company plan for attracting and converting new customers. It would be best to do a scenario analysis to understand your market position concerning your competitors clearly; only then can you develop a solid and successful market strategy. Market strategy plays a key role among all the other ingredients of a marketing plan and contributes to marketing success.
A marketing strategy covers the 4Ps of the marketing mix: product, price, place, and promotion. In addition, a marketing strategy entails brand messaging, its value proposition, demographic information about its target customers, and other advanced elements.
Below are few B2B marketing strategies:
Social media marketing
Search engine optimization
Search engine marketing/PPC (Pay-per-click)
Appropriate Financial Planning
Another crucial element of a marketing business plan is financial planning. Marketing your campaign is a costly aspect of the business; it is necessary to have an appropriate and realistic budget plan to avoid financial wastage. Allocate your budget for each activity planned and manage your cash flow.
For 67.4% of respondents, a limited marketing budget is the top marketing challenge facing small businesses.
Plan your financing considering the organization's budget cycle, organizational events, seasonality, festivities, etc.
The following points demonstrate why financial planning is essential.
Prudent financial management
Profit and loss measurements
To determine the value of liabilities and assets
Utilization of Marketing Channels
There are several marketing channels, but they are constantly changing and evolving. Therefore, due to a shortage of time and funds, select the appropriate channels.
Choose the channel that is the most effective for promoting your products, services, and brand identification to potential consumers, depending on whether your firm is B2B or B2C.
Channels provide a variety of purposes, that includes assisting you in discovering new methods to sell to your ideal client and help you to create experiences for your audience that help establish your brand reputation.
Here are few channels that are utilized:
Retail or Ecommerce
Social media channels
Word of mouth
Pay-per-click (PPC) marketing
Analyses of Competitors
While a marketing strategy entails several analyses that aid in the operation of your firm, a marketing competitors' analysis is conducted concerning your competitors. You should be aware of your competitors and the distinctions between your products and services.
Analyses of competitors are a crucial component of every marketing strategy. Conduct a competition analysis to learn about your competitors' goods, sales, and marketing tactics. Marketing competitor analysis is a critical component of any marketing plan since it helps differentiate your product or service from the competition.
Competitor analysis enables the following:
Identify market inefficiencies
Identify market trends
Create innovative goods and services
Increase your marketing and sales effectiveness
A sound marketing plan will help you generate leads. Ascertain that your marketing strategy is recorded. Numerous marketers assess the effectiveness of their efforts in relation to their objectives. This enables you to plan more effectively for the future and provides a clear picture of continuing changes.
What are the key ingredients in the marketing plan?
Here are the critical ingredients of the marketing plan
Extensive market research
Appropriate financial planning
Robust market strategy
Utilization of marketing channels
Analysis of competitors
Clear marketing objectives
What is a successful marketing plan?
A successful marketing plan generates a positive return on investment (ROI), additional revenue, client lifetime value, and cost per win (sell), among other metrics. A marketing strategy is successful when it maximizes the benefits to your firm.
"name": "What are the key ingredients in the marketing plan?",
"text": "Here are the critical ingredients of the marketing plan
Extensive market research
Appropriate financial planning
Robust market strategy
Utilization of marketing channels
Analysis of competitors
Clear marketing objectives"
"name": "What is a successful marketing plan?",
"text": "A successful marketing plan generates a positive return on investment (ROI), additional revenue, client lifetime value, and cost per win (sell), among other metrics. A marketing strategy is successful when it maximizes the benefits to your firm."