Presentation on how to listen to customers and adapt your restaurant to better serve them.

1. Effective Use of Marketing Data Chris Stiehl & Henry DeVries StiehlWorks & New Client Marketing Institute September 21, 2009

3. How do we uncover the “Voice of the Diner”?

4. What can we do with the “Voice of the Diner” once we have it?

5. What other “Voices” might we listen to?

7. An Example of What We Already Know versus How We Think About Success Let’s think about going to the movies…

8. Movie Theater Example If you owned a movie theater and went to Europe on vacation, what would you want to know about your business while you are gone?

9. Movie Theater – Part 2 You no longer own the theater. Now, you’re at dinner and you are trying to select between two theaters (equal price, distance and start times). How would you decide?

10. The Movie Theater Example Why don’t the lists agree? How did we know they wouldn’t? How would you characterize the two lists:- Looking forward versus backward- Bottom-line oriented versus customer-focused- Predictive versus reactive- Do the items on the list tell you what to do to get better if you are in europe? When you look at the customer list, what types of experiences do you think lead to what was said, positive ones, or negative ones (pain)?

11. What Does This Mean to You? Should the lists agree? How tough is it to think like a customer? How does the “Voice of the Customer” in the movie theater example relate to what you should measure to predict success with your diners and prospects?

12. The model of knowing your customer so well that you anticipate their every need!

13. Customer/Member -Driven Improvement Model

14. How Does This Work?

15. Does Customer Satisfaction Matter? Retention after competition For AT&T based upon Satisfaction previously

16. Your Diners and Six Sigma The Design for Six Sigma Roadmap lists 35+ steps. Step #2 is “list all detailed customer and functional requirements of the product or service.” 266 of the largest 500 publicly held companies in the US as of 11/1/06 were implementing Six Sigma. Is that “enough said?” How do you get the “detailed requirements?”

17. Starting the Voice of the Diner Process Understand What You Are Trying to Accomplish: Write down what we already know (your mission statement, for example) Understand what “pains” we know in our dinership, if any Market to the diners’ pain; work on what is painful to them.

18. Knowing What Can/Cannot Be Said

21. 15 in-depth interviews produce better information than 7 focus groups

22. Voice of the Diner Process Phase 1 Identify Issues Write Interview Guide Test Interview Guide Phase 2

23. Collecting the “Voice” Requires Skill Techniques can be learned with practice, but not everyone is comfortable nor able to conduct good interviews Not everyone is capable of being a good respondent You need to learn how to write an interview guide, prepare, probe, develop needs statements, the “5 why’s”, etc. You must prepare and rehearse…but, Let’s get a feel for the process!

24. Writing the Interview Guide Rarely will 50% of the interview guide be used in any one interview, but all of it will be used over the course of all of the interviews. Don’t think quantitatively about qualitative research. Gain familiarity with the guide so you will be comfortable skipping around – following their passions. Start with the idea that you are creating an encyclopedia of relevant issues. Arrange questions within a topic from the broadest to the narrowest. Group questions into a natural pattern or flow. Make the questions open-ended.

25. 10 Questions to Ask What are the three most important things that you are trying to accomplish when you dine out? What gets in the way of accomplishing those things? What do you spend most of your time doing when you dine out? What would you like to be spending most of your time doing? If you could change one thing about your typical dining experience, what would it be? If I said dining at ______ was a good value, what would that mean? What is the biggest pain about going out to eat? What things are a big help; i.e., what things have you experienced, no matter how small, that really work well? Describe for me the “ideal” dining experience. Describe for me a recent time that your dining experience was less than ideal.

26. Voice of the Diner Process Phase 2 Interviews Audio Recording Transcription Attributes Hundreds of phrases “Winnowing” Phase 3

27. Pros & Cons of “Passive Listening” Pros/Behaviors Cons You may not get as much detailed information, especially if the subject has trouble composing their thoughts You may get data that is subject to interpretation because it has not been explored enough You are required to have a “poker face” – not to respond to what the subject says in any way except, perhaps, to nod or say, “Uh huh.” Subtle but powerful behaviors Lean forward Engage your eyes Sit at an angle Use verbal & nonverbal cues Don’t fill silences; so people take longer to formulate their thoughts Tends to reduce introduction of biases

28. Pros & Cons of “Active Listening” Pros/Behaviors Cons You may interrupt a speaker’s train of thought or reduce their enthusiasm for discussion You may interject your own interpretation of the issue through paraphrasing You may incorrectly mislead the respondent into thinking the topics that are paraphrased are more important than those that were not paraphrased If not done well, can confuse the issue of who is being interviewed Make speakers feel acknowledged and heard; therefore, likely to share more Clarifies meaning; if there was a misunderstanding, it can get cleared up Creates easy summaries and transitions Provides another tool to surface needs and pain, besides probing Allows time for thoughts to be organized Ask for stories and interact, encourage

29. Learn what to listen for… Listen for Growth Opportunities/Pains/Changes Listen for Product/Service Quality (rework) Listen for Problem Correction (make it right) Listen to Foster Customer Loyalty (repeat business) Listen to Improve Brand Management (str. & weak.) Listen for Market Research (trends in real time) Listen for Competitive Advantage (possibilities) Listen for Context (identify exact likes and dislikes)

30. Learn to Recognize Needs and Pains:Consider a Cup of Coffee “I’d like a hot cup of coffee” – too vague; probe what hot means “I’d like my coffee in a styrofoam cup” – a solution; probe why “I’d like my coffee to be 105 degrees”- a target value; probe why “Hot coffee tastes better”- an opinion; probe why “I want my coffee to stay hot all the way to work” - a need statement we can design to; probe for distance, time, target values. Listen for Needs and Pains!

31. Voice of the Diner Process Phase 3 Card Sort Focus Group Structure of Customer Needs Data Analysis

32. The Hierarchy of Needs Written in the language of the member Written to describe the ideal (translate negatives into a description of the ideal) The hierarchy represents how the diners think, not necessarily how staff thinks One or more focus groups of 4 to 6 diners organize the needs in an interactive process They are instructed to put things together that go together and name the categories

33. Hierarchy of needs derived from member card sorts. A description of the ideal conference.

34. Customer/Diner -Driven Improvement Model

35. What are the Key Criteria for a Good Metric? Must be internal and predictive of meeting a need Must be measurable (I can get a number) Must be controllable (I can make the number change by taking action) Targets are known (What score do I want to hit?) Interactions are known (What else is impacted by moving this number) It is repeatable (If I measure twice, I’ll get the same number) It is easily implementedRemember the “fresh popcorn” example? How did we measure “freshness?”

36. Predictive Diner Metrics What metrics predict how your diners would respond to a survey question about the “responsiveness of the restaurant staff?” Time to be seated Time to take order Time from order taken until food is served Attitude when serving Temperature of food when served

37. MeasuringTime We have measured how diners think about time and how restaurant staff measure time. How much time do you think each group thinks elapsed when exactly 60 seconds go by?Staff - 25 to 35 seconds, on average Diners - 2 to 3 minutes, on average Diners and Staff have a different sense of time!

38. Do Your Metrics Predict Success? It is tough to come up with predictive metrics. By the time you get a survey result, the damage has been done. This has been described as driving down the road while looking in the rearview mirror. You should never be surprised by a survey result.

39. Customer/Diner -Driven Improvement Model

40. Writing Good Survey Questions

41. Hierarchy of needs derived from member card sorts. A description of the ideal conference.

42. Survey Questions Diners Want to Answer Use the categories from the hierarchy that they created. When you get a survey result, you know what they are talking about. Surveys designed this way get much higher response rates. The surveys are shorter and address issues than diners care about.

43. Always Ask About Importance You want to work on issues where your score is not as high as you’d like, that are also important to your diners. If all you know is “satisfaction,” that is not enough. You must also know how important the issue is.

44. Customer/Diner -Driven Improvement Model

45. Taking Action What metrics predict that a prospective diner will come back to your restaurant for lunch? Convenience of location Quality of service Cost (hint: what cost is there besides money?) Having quick quality choices for lunch Having the right industry diners already

48. Managing for Success Learn how to listen! Create predictive internal metrics! Ask the diners how you are doing. Create staff teams to resolve issues and improve the metrics. Follow the customer-driven model; always have the diners’ voice in the room!

49. A Model of Customer/Diner-Driven Improvement Qualitative Research Pain (Voice) of the Customer Internal Measures Process Improvement Quantitative Research Process Metrics Improvement Initiatives External Measures

50. For More Information

51. Thank you for your participation! Chris Stiehl & Henry DeVries StiehlWorks & New Client Marketing Institute Phone: 619-516-2864 & 619-540-3031 E-mail: chris@stiehlworks.com & henry@newclientmarketinginstitute.com Web site: www.painkillermarketing.com