The importance of competition within any sound business environment cannot be overstated in this discourse. The same applies to marketing and advertising. It’s the existence of competition, dependent on the level among other factors, which necessitates marketing and advertising. What this means is that, without any meaningful competition between competing products/services, there would be no need for any advertising and marketing.

Through marketing, restaurant signage and advertising, a service or a product is often familiarized and endorsed to prospective customers. With a prudent marketing and advertising strategy by a business, consequently there will be more sales which mean more revenues/profits. For this particular discourse, the restaurant business will be our main area of concentration. The restaurant or the food service business is habitually a lucrative industry that needs a lot of careful planning to realize the maximum benefits or potential.

Having appreciated the importance of restaurant marketing, the most often unanswered question that lingers on minds is,how much should I invest in marketing and advertising for my restaurant? The answer to that question may seem a straightforward one but through my experience, I must admit, is always a tricky one.

According to the statistics from the National Restaurant Association (USA), the budget for the average restaurant marketing is 3% of the annual revenue. That figure may provide you with a basis, but the question should be, is it adequate for any meaningful gains?Generally the recommended promotion spend is between 2% and 10% of total revenues. But before we can go there, the first step for you is to know how much to allocate to marketing. A few calculations to determine your gross annual income will do. There are a number of online marketing budget calculators that can be downloaded for use.

After understanding your annual income, there are also a number of factors which will influence how much to spend. These include;

I. New or old restaurant?

Typically a brand new restaurant would require more restaurant marketing because often the customer base is smaller if the competition level is higher. A smaller customer base means less or no profits. Marketing can help change the tide in your favor. A new restaurant marketing budget may include; designing menu and logo and designing restaurant website (mobile-friendly). In this scenario, a 25-35 percent of total revenues are recommended for marketing.

II. Stable and growing restaurant

Since we have seen how marketing budget and revenues are related, with a stable and growing restaurant business, you will be able to have stable figures and therefore be able to adjust your marketing as you deem appropriate. More budgets may mean more revenues but that is not always the case. In his last public speech, Sam Ayyash list two important factors here you will have to consider are profit margin and the level of competition. For example, if the competition is stiff, a 15% or even more marketing budget is recommended.

III. Established restaurant with stagnating or declining revenues

Often when the business is not doing very well, the first casualty of reduced expenditure is usually the marketing sector. It may not always be the best course of action. Look for the extravagances. A 3%-10% more of your current budget is recommended in such a scenario, and be able to adjust accordingly as you stabilized again.

In conclusion, it is advised that at the minimum 40% of the budget allocated for marketing should go for digital marketing. Digital marketing must comprise Search Engine Optimization (SEO), Pay-Per-Click (PPC, Social media and blogging. We all know how the internet has changed how we do business because of the various benefits it presents.

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