Engineer Your Menu! – Pricing Maneuvers

We promised—and here it is! Mel’s kicking off our Engineer Your Menu series with a closer look at the way pricing is presented on your menu—and how this can affect your customers’ meal buying decisions (and whether they come back for more). Dig in!

Your marketing instincts may be telling you that in order to stay competitive, you should price dishes and drinks at a “bargain,” even if your restaurant is on the higher end. Well, throw those instincts away (or tuck them in the back of your mind where they belong). There’s much more to obtaining, and retaining, restaurant customers than the bottom line. Here are a few tricks of the trade other restaurant owners and managers may not have told you.

  1. The Class Factor. Even in a down economy, visitors to higher-end restaurants expect to be treated as if they’re willing and able to spend. So be sure to present your pricing in a way that subconsciously reassures diners you feel they’re the tops. One ingenious way shared with me by restaurant owners is to leave decimal point and cents off pricing on your menu (i.e.: 26 v. $26.75). The clean look has a psychological “it doesn’t matter how much it really costs” feel — even though it does (so do remain at least in the ballpark of cost-competitive when it comes down to the actual pricing).
  2. Fade the Spending Part of the Experience into the Background. Looking at things from another perspective, leave the dollar sign off the prices on your menu. To a diner, there’s nothing that screams “you’re spending!” more profoundly than the image of the dollar sign. Don’t drive that point home. Just leave the sign off. The price is there for your customers to see and that’s plenty of information – fade the spending portion of the experience into the distance and keep the wonderful dishes and service in the forefront.
  3. Take a Visual Dollar Off. When a restaurant customer sees $6.99 rather than $7.00, his or her mind will automatically expand the “6” and dismiss the $.99. This is an old marketing trick but one that continues to work well to relax customers and make them feel they’re getting their money’s worth.
  4. Stagger Profit Margins. Don’t try to maintain an even profit margin percentage for all of your menu offerings. Instead, position a few “loss leaders” — dishes that are priced much closer to cost than your more spendy items. These dishes should lead into your evening specials, regular entrees or drinks. Similarly, try a larger profit margin on some items and a smaller one on others – again, these should be tie-in items – but not necessarily so close to cost. Your customers will be saving overall, while you will be able to maintain the integrity of more expensive or difficult-to-get ingredients and offer those at a rate that will reasonably reflect back to your bottom line.

If this all seems rather, well, “psychological,” keep in mind that the act of dining itself is a psychological experience. Anyone can grab a bite of food. But a fine meal delivered with exemplary, respectful service is in a category of its own…and if you deliver it every time, your customers will come back again and again.