The not so secret sauce that brought back 27% in revenue for a restaurant franchise
🗺Background
In 1999, Attila Wings purchased the very first Hooters franchise. The owner was a former store manager of Hooters, with a great relationship with HQ, which finally presented a business deal that could not be ignored. The processes, operations, marketing, royalties payments, and logistics set the parameters, tone, and standards of all following Hooters franchises nationally.
The original franchise has relied on word of mouth and the fame of the Hooters brand to bring in customers for years, but as the markets changed, and Hooters HQ grew its franchise base, Attila Wings and Co. saw the need to start exploring what for them was an untapped method of promoting their stores and enhancing the user experience. In short, the formula that had worked for so many years, could no longer keep up in a modern, highly digital market.
There were noticeable changes and shifts in the atmosphere. Changes in user preferences towards healthier options and diverse dining experiences affected a brand that was very stuck on a rigid dining identity. Additionally, former patrons and avid consumers of the brand, have moved on to more diverse options of casual dining, as well as, more family friendly new competitors such as Wingstop, Buffalo Wild Wings, P.J Whelihan’s as well as quick, national chains like KFC and so on.
In 2017 in particular, major shifts across the country started to create ripple effects on how places like Hooters attract and keep customers. The once attractive and daring brand proposition centering the attention on their conventionally beautiful and overly friendly servers, had lost its luster. Instead, customers were seeking out brands and environments that truly focused on offering a great product without any gimmicks, as well as, casual atmospheres that would serve as third spaces, where they can meet their friends, colleagues, and family.
Customers were seeking a relaxed, casual dining environment and they had a myriad of options to choose from. This competition to grab the user’s attention was aggressively held on social media. In the home of the 7 locations (mostly suburban areas), the majority of brands would heavily rely on Instagram, Facebook, and Google to promote themselves. Customers would follow their favorite brands, as well as local franchises and restaurants to receive alerts, promotions and coupons, which would motivate them to visit more often.
Lastly, because of the suburban environments in which most of the stores were operating from, there was a wayfinding challenge. Several of them would seldom pop up on map searches on Google Maps and Waze. This led to the franchise to truly rely on word of mouth to not only be discovered, but remembered. Hooters needed a physical and a digital revitalization to re-introduce itself to old and new customers.
💔The Problem
I set out to answer two questions:
1️⃣ How might we utilize digital tools to connect with a younger audience with changing values, and leverage technology to improve the overall customer experience, both in-store and online?
2️⃣ How might we better use the brand identity of Hooters to develop standards for email blasts and social media posts, in order to build a stronger relationship with the user?
💥Action
Hooters wanted to bring in a younger generation of customers, specifically women, and families without completely alienating the audience that was once there.
🔸User research
The franchise owned a demographic report that analyzed the areas that the stores were serving. This data breakdown of residents of those areas, helped me understand my research portion and also gave me an initial hypothesis of who was frequenting the restaurants.
I began by theorizing about the franchise audience. This franchise owned 7 different restaurants, and while they all served a very similar demographic on the surface level, the customers segmented differently based on where they lived. More specifically:
1️⃣ King of Prussia, PA - Mostly younger men, office workers, students from Villanova University
2️⃣ 3 other PA and 2 NJ locations - Late 30’s-middle-aged men, blue collar workers, sports fans, construction workers, retired men.
3️⃣ Atlantic City, NJ - Varied customers that would stay or visit the Tropicana hotel and casino, and users that would walk in from the boardwalk. Audiences were varied, but with an increased amount of female audience in their late 20s to mid 30s, in comparison to the other stores.
🔸Field studies and rapid stakeholder interviews
I wanted to gain more clarity on the behaviors, preferences, and actual attendance of various locations, so I began conducting field studies. I had a list of questions and topics to address with each visit, including:
✏︎ What is the different customer base per shift
✏︎ What sort of customers frequent on different days of the week (weekday vs weekend)
✏︎ What sort of customers joined during holidays and special events (football games, Veterans day, etc)
I conducted roughly 3 visits per location to various locations, and was able to really understand the customer behavior better.
Additionally, I conducted rapid stakeholder interviews of the franchise managers, and asked them questions such as:
✏︎ Can you tell me about the type of customer you see visit your restaurant in the last 3 years?
✏︎ Who is your typical customer that comes in during weekday lunchtime?
✏︎ Who is your typical customer that comes in during weekday dinner time / happy hour?
✏︎ Who is your typical customer that comes in during the weekend lunchtime?
✏︎ Who is your typical customer that comes in during the weekend dinner time?
Age range breakdown per location.Ratio breakdown Women and Men
I combined the results from stakeholder analysis and field studies to reach the following findings:
🔸Pain points:
✏︎ In each location, the default customer demographic has stayed the same but all locations saw a reduction in traffic.
✏︎ While the customer demographic data showed a specific segment of residents in the area, Hooters would see a vastly different demographic of customers who’d frequent the restaurants. For example, regardless of the fact that an area had lots of single-family homes, restaurants would still see mostly workers come in for dining. As a designer, I understood that just because a restaurant existed in the area, it doesn’t mean that the Franchise had any relationship with the community.
✏︎ Every location, and manager emphasized changes in customer frequency in visits. Stores saw an average drop of 28% of revenue, which equates to roughly 2500 individual visits lost per month (averaging $20 dollars per meal).
🔸Changing demographics throughout the week:
✏︎ The dinnertime customer segment was traditionally a younger group, comprised of mostly men.
✏︎ 6 out of 7 locations noted that they had a difference in customer segments depending on weekdays versus weekends. For example, KOP location would have primarily office worker groups Monday through Friday, with a shift to younger students on the weekends.
🔸outlier:
✏︎ Tropicana Hooters is an outlier when it comes to demographics because they have several points of access for people, like the casino or the boardwalk. The location had to depend much more on wayfinding (digitally and physically) rather than on relationship building with the community around itself.
✏︎ The 3 Hooters near colleges had a more consistent younger customer base, still comprising of mostly men.
📊Competitive Analysis
Since the Franchise’s inception in 1999, the areas saw a tremendous growth in competition that directly and indirectly affected the Hooters’ foot traffic. To understand what we could learn from the competition, I began by analyzing :
Buffalo Wild Wings
PJ W
Wingstop
KFC
Chick-fil-A
I analyzed their differences including :
Overview
Value proposition
Target market
Price range
Strengths and weaknesses
Threats and opportunities
✏︎ While their target audiences are somewhat similar, the one specific area in which all the competition excelled at is their focus on catering to a wider audience from the beginning. While Hooters was focusing primarily on a male audience, everyone else decided to bet on a more stable and inclusive option.
✏︎ Hooters faced a disadvantage when it came to the amount of stores in the territory. While brands like Buffalo Wild Wings have thousands of locations nationwide, and stores like P.J Whelihan’s has a significant presence in NJ and PA, Hooters totals to less than 50 stores nationwide. This allows for the competition to have a lot more control of the foot traffic in their respective and nearing areas.
✏︎ While Hooters does have a unique user experience, it has remained in the public’s mind as associated exclusively with their servers and not the quality of their product (the food). All of these other brands have managed to build an image based on different value propositions such as being places to watch sports, or being places with great food.
✏︎ While all other franchises had salads as a healthy option, Hooters instead introduced smoked wings to the menu, disregarding the changing needs and goals of customers. (Smoked wings are marginally healthier than breaded wings, but it wasn't enough of a progress). This pattern of failing to listen to customers, especially female patrons, further alienated existing and new customers from the Hooters franchise.
⚙️User Experience
🔸Findability and user journeys:
The franchise was very bare-bones in its digital footprint, which allowed their competitors to take a lead on the market. I addressed the findability challenges by looking at user journeys, by looking at wayfinding in the digital environment, and how it presents itself in the physical environment.
User Journey- Before the plan of improvement: Group of friends looking for a bar to watch the game.
Once I created the user journeys, it was easy to see the pain points come to life. Namely:
1️⃣ The brand was not popping up on social media, Google, or maps when customers would enter various keywords.
2️⃣ Once the user found the store in their vicinity, finding extra information like menu options, social media links, photos, etc., wasn’t easy.
3️⃣ The lack of information made it hard to the user to easily get contact information for the store to check on hour of availability, and other questions.
To address the challenges and gaps, I worked with Google Maps, and Waze to verify the Business Profiles. I strengthened the descriptions of Hooters locations on both platforms, adding photos, reviews, and up-to-date working hours. Locations could now be easily found, and would show up as a result in searches from prospective customers in the area.
User Journey - After plan of improvement: A family with young children.
User Journey - After plan of improvement: Coworkers looking for a fast an easy lunch.
🔸Programing:
To attract new customers, I encouraged the franchise to host more events focused on these target audiences, and to expand the activities for families with a focus on children of all ages and mothers. For example, we’ve organized an Easter Egg Hunt for kids and their families, as well as a Mother’s Day brunch where we didn’t charge moms for their meals.
In order to focus on bringing more women to the locations, we created a fun and playful promotion where if they brought a photo of their ex, the customers got 10 free wings. Where usually we saw a 75% men to 25% women ratio of customers, the promotions would bring the female participation to more than 40%. This allowed them to familiarize themselves with the brand, meet the friendly staff, and taste the menus, thus building a relationship with the brand that they’ve never had before.
Additionally, we created fundraisers that were family-centric, and set the tone for the sort of priorities that the company had going forward. One of the fundraisers was focused on a toy-drive, where if customers brought in toys, Hooters would offer meal vouchers or special discounts.
I tracked the customer turnout and recorded foot traffic. The events focused on families were tremendously successful with Hooters seeing a stronger presence of women, families, and kids. These events also helped to strengthen the relationship between the restaurant and the community, to demonstrate its changing values and modernization. Families could now see the restaurants as a “third-place” to be able to all come as a unit, for not only a quick bite, but also for special events.
Restaurants reported financial spikes during the events, and a continuous, steady growth in revenue afterwards.
📱UI
[This section has been truncated to focus only on the result of the work from the new Design Library. To view a case study on my ability to create design libraries, please see “Hooters Design Library”]
🎉RESULTS
I tracked the result through a multi-channel view. I focused on our website traffic, on the social media engagement and interactions, and the newsletter responses. Additionally, I utilized qualitative feedback from managers and customers in various locations.
🔸wayfinding:
There was a significant 40% increase in Google maps visibility of locations and interactions. On Waze, we utilized the banner feature to attract new business and alert customers about special deals. Customers on both platforms could now see the various restaurants more easily, when they would type in key terms such as “food”, “wings”, “sports bar”, “fries”.
🔸Communication:
The various social media accounts such as Instagram and Facebook grew the follower base by 80% in 5 months, which helped alert the customers to the deals, promotions, and special events.
Customers would also be attracted through a consistent newsletter which was now easy to create and disseminate due to the design library.
🔸Growth in business:
The various design changes more than doubled the customer attendance to restaurants for special events. Managers saw a growth in requests for catering services and large group events.
The franchise was finally able to meet their financial goals. The various store locations had anywhere from $140,000 to $160,000, $175,000 dollars in revenue per month.
Through the redesign, the focus on content, the unification of all channels in terms of usability and aesthetics, every store experienced a growth of revenue totaling $200,000 consistently, every month. Some stores would frequently exceed expectations with an average of $500,000 revenue. In total, the stores experienced a consistent average growth of 27.027% in monthly revenue.
In terms of the users, I’ve noticed a very positive growth in their relationship with the restaurant group. Hooters saw an attendance growth of their target audiences including women, families, and people who wanted to use the space as a way to connect, watch the game, and relax.