Five Lessons Restaurants Can Learn From Zaarly

I am a fan of Zaarly.  If you are unfamiliar with the site, Zaarly is the most interesting internet startup company I have run across in years.  The concept is simple: Zaarly allows buyers to name their price for the goods and services they wish to buy.  This works by allowing the market place to cater to the buyer rather than the seller.  Likewise, people who never knew they had an interest in being a seller can find offers that make them reconsider.  I have used Zaarly for everything from landing a meeting with an incredible social media expert to scoring tickets to a ballgame. 

When a new concept like this comes along, it makes me consider what restaurants can learn from it.  After a bit of consideration, I can think of five very important lessons that restaurants can learn from Zaarly.

Lesson One: People Follow A Leader:  In reading a recent article on Zaarly, I learned a bit more about the team they have assembled.  Innovative minds from around the country have left their jobs and homes to work for this company.  Most have done so to work for Zaarly CEO Bo Fishback.  This is an incredible testimony to his leadership skills, but also an important lesson for restaurant managers.  People will not follow a manager.  To create a loyal staff of top performers, you must be a leader.  Only through leadership can you inspire your staff to perform at the highest level and produce the highest quality results.

Lesson Two: Demand Drives Supply:  This is the primary concept of Zaarly’s business model.  Let the consumer have a voice and supply will follow.  Unfortunately, restaurants often ignore this idea.  Each year thousands of restaurants open to offer a product they are certain the community will love.  They also fail with great frequency.  Many failing and failed restaurants are driven by the idea that if they create the supply, the demand will follow.  These failed restaurateurs often blame the market for their concept not catching on.  A successful restaurant focuses on the demand in the market and fills it.  These restaurateurs realize that filling demand is far easier than creating it.

Lesson Three: People Pay For Convenience:  Most transactions on Zaarly are what I would consider transactions of convenience.  Someone offers to pay to have someone else deliver anything from a latte to a steak dinner.  The restaurant industry is built on this principle.  Someone could cook a meal at home for less money, but they pay for the convenience of having someone else do it for them.  They will sacrifice quality to avoid getting out of their car.  They will even pay an additional charge to have the meal delivered to them.  If you are concerned about your restaurant’s profits, consider ways to make dining at your restaurant more convenient than your competitor.  When you compete on convenience, you can charge extra to help your bottom line.

Lesson Four: It’s Who You Reach:  Groupon often brags about the number of subscribers to their offers.  What they seldom mention is what percent of those subscribers become customers.  I would argue that the second number is more telling.  Zaarly does not advertise on the Super Bowl, but they did target a select group of early adapters to spread the word about their service.  Having Ashton Kutcher and Demi Moore tweeting about your site before it is even launched is far more cost effective.  Locate the foodie influencers in your community and target them.  Buy meals for restaurant bloggers.  Have your staff spread the word across their social networks.  Shake the hands of your best customers.  All of these will have a greater return on investment than any advertising you could pay for.

Lesson Five: Happy People Work Harder:  This is a concept widely accepted as fact in Silicon Valley, but seldom adopted in restaurants.  Zaarly provides a comfortable and laid back environment in which employees push themselves and voluntarily put in much more than an eight hour day.  This is because they don’t hate being at the office.  If you want to receive greater effort from your top performers, find a way to make them happy at work.  Creating a work environment that makes your staff look forward to arriving at your restaurant will result in them creating a better environment for your guests.  You can’t eliminate every hassle a server or chef will experience during a shift.  Limiting hassles that are within your control will have a significant impact on overall morale and performance.

This might be the first time you have heard of Zaarly.  I encourage you to check it out.  More importantly, I encourage you to consider the underlying principle of this post.  Behind every successful company are concepts that you can apply to make your restaurant more profitable.  Look beyond your competitors for insights and you will soon find them trying to determine your secrets. 

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About David Hayden

David Hayden is a restaurant marketing and training consultant based in Kansas City, MO. He writes a series of 9 blogs collectively known as The Hospitality Formula Network and is the author of "Tips2: Tips For Improving Your Tips" and "Building Your Brand With Facebook"

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