Four Steps to Happy Hour Success

For most full-service restaurants, between 20-30% of their revenue can be attributed to alcohol sales.  Margins on alcohol sales run quite high, really increasing your bottom line.  So, what if there are untapped sales out there for you to capture? According to Nielson.com Happy Hour, which is defined as 5:00 PM – 8:00 PM, is the clear winner when it comes to on-premise alcohol sales. Below are just a few facts from the study that we found particularly interesting:

  • U.S. bars and restaurants generate 60.5% of their average weekly sales from Happy Hour—just 15 hours of the total business week.
  • The average happy hour check in the U.S. is $68.99 (after discounts), including food and drinks, which is $8 more than the average check during other daypart occasions.
  • Wednesday Happy Hour traffic is an average of 23.9% higher than other weekdays. This makes Wednesday’s Happy Hour the fourth most valuable day part for bars and restaurants, with the same daypart for Saturday and Friday coming in first and second place, respectively.

If you’re already offering Happy Hour deals, how can you be sure you’re doing them the right way? And if you’re considering instituting a happy hour or late night special at your restaurant, how can you turn this into a success for you and your patrons? Start with these four steps:

Step One:  Clarify Your Goals

Your true goal isn’t just about filling up gaps between busy shifts. Doing Happy Hour right makes it less about raking in sales and more about building new relationships. Happy Hour is often less expensive than a full meal; it’s less of a risk for your guests. If people are satisfied with their Happy Hour experience, they may well stay on for a full dinner. If they’ve had a good meal, they will most likely come back for dinner in the future. You’re not just extending your sales period – you’re encouraging return customers.

In short, your goal for off-peak specials:  Make it a positive experience first and worry about profits second.

Step Two: Cater to Your Demographic

Study historical sales to see what your patrons are buying, and what they are not.  Do you mostly sell traditional beers and wines or does your demographic prefer spirits and ciders? Offering specials on drinks that your customers have proven to be favorites through your sales data is the best way to ensure that you are giving patrons specials on the specific items that they want.

Step Three:  Avoid the Cheap-Food Trap

Off-peak patrons are still valued guests. If you treat them right, they’ll turn into repeat guests. So, don’t fall into the trap of providing low-quality food or drinks during these periods. You don’t have to roll out the fillet mignon, but don’t palm off dried-up chicken strips and dubious sliders onto your diners. You may not make the same rate of profit on your Happy Hour sales, and that’s okay. Remember, it’s not all about the sales. You’re creating an impression about your food, drinks, and service. Make it a good one.

Step Four:  Select a Plan of Action

Now that you’ve eschewed the cheap food and watery drinks, what can you serve?

Here are some ideas:

  • Use smaller portions of selected regular menu items
  • Feature appetizers, small plates, and other high-quality, wallet-friendly items
  • Try out new menu items, or make use of seasonally available ingredients
  • Have a regular, limited menu of favorites so guests will know what to expect and the kitchen can easily turn out quick, consistent plates.
  • The key to this step is not to skimp on quality. Whichever you choose, make it worthy of the image you want your restaurant to project.

Happy Hours can make a welcome difference in your guests’ day, a way to extend a pleasant experience. Make them feel welcome and give them a good value, and these off-peak hours can help create sales, boost your restaurant’s reputation, and encourage repeat customers.

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