Lisa D. Spiller, Ph.D. Christopher Newport University Carol Scovotti, D.P.S. University of Wisconsin – Whitewater

1. Lisa D. Spiller, Ph.D. Christopher Newport University Carol Scovotti, D.P.S. University of Wisconsin – Whitewater DMEF/CADMEF Case Writers Workshop – October 17, 2009 San Diego, California

2. Background: Restaurant Industry • Economic Crisis by the numbers • U.S. sales: $181 billion in 2008 • Projected decline in 2009 by 2.5 percent • 52% of Americans dining out less often • 66% no longer enjoying fine dining • Few families (with children) dining out • Smaller average check amounts • Numerous competitors…offering discounts • Harsh times for restaurants…

3. Nonna’s History • Family Owned Italian Restaurant • Owned & Operated by Anna and Cris • Small staff • Opened: June 2007 • New location: 2009

4. Situation: New Location…New Opportunities • Old location: Not visible, limited capacity • New location: • Excellent visibility • Spacious, patio and private dining room • Convenient location

5. Decision Problem: The Case Challenge With a new location… an expanded menu… a new private dining room… a new outside patio… new specialty products… many loyal customers… Where should it begin?

6. Case Organization • Case perspective • Anna Russo Coggeshall • Grew up in family restaurant business • Passion for Italian food • CNU graduate • Understands D/I Marketing

7. Overarching Problem How should Nonna’s allocate its marketing budget to: • Increase its guest traffic • Promote its catering business • Launch its specialty product marketing

8. Decision #1 – Increase Guest Traffic to Nonna’s • Spent more than $30,000 on direct response promotions • Cooperative mailings • Discount mailers • Special invitation dinner events • Yellow pages advertising • In-house bounce back coupons

9. Nonna’s Discount Postcard Mailer - Front

10. Nonna’s Discount Postcard Mailer - Back

11. Direct Mail Special Event Postcard - Front

12. Direct Mail Special Event Postcard - Back

13. Nonna’s Promotional Offers - Metrics

14. What works best? Bounce-back coupons CRM… Database-driven marketing! Case Question: How might Nonna’s use its customer database to increase guest traffic?

15. Decision #2: Increase Nonna’s Catering Business

16. Nonna’s Catering Services • Dine-In Parties • Restaurant - 250 seat capacity • Private banquet room – 35 seat capacity • Private patio – 60 seat capacity • Casual Catering • Off-site catering services • Business meetings, lunches, parties, etc. • Formal Catering • Off-site catering services for up to 500 people • Weddings, showers, formal events, etc.

17. Case Question: What lists might Nonna’s rent to increase its catering business?

18. Decision #3: Generate Sales for Nonna’s Specialty Products • Based on consumer demand • Marketed within the restaurant

19. Nonna’s Specialty Product Costs and Prices

20. Case Question: What might Nonna’s do to launch its specialty products & generate sales?

21. Case Summary This case demonstrates how… • D/I marketing methods are used by a family-owned restaurant business • The multitude of objectives D/I marketing can address • The need for: “Shark marketing On a Minnow’s budget”

22. Teaching Suggestions Suitable for lectures & team projects associated with: • Market planning & coordinating • Entrepreneurship & small business • Relationship building/loyalty, offer strategy, creative strategy, or lists/database portion of direct marketing courses • Segmentation or promotional strategy portion of upper-level marketing courses • Integrated marketing communications • Brand building & sales promotions • Quantitative analysis & direct marketing math

23. Thank you for your attention.Any questions? Lisa D. Spiller, Ph.D. Christopher Newport University Carol Scovotti, D.P.S. University of Wisconsin - Whitewater