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Morning Briefing for pub, restaurant and food wervice operators

Fri 3rd Aug 2012 - Friday Opinion
Subjects: John Foster, marketing, re-building Luminar
Authors: Paul Chase, Ann Elliott and Peter Marks

Why John Foster has got it wrong by Paul Chase

I read with interest Dr John Foster’s piece “Alcohol addiction and education” in last Friday’s Propel. I have to wonder whether someone hasn’t created a ‘neo-temperance toolkit’ that gives them the formula and content of their anti-alcohol propaganda, because all the elements were there: the ritual denunciation of the drinks’ industry as one-dimensional capitalist villains who cynically favour alcohol education because it doesn’t work; the usual tired arguments about raising price and reducing availability were rehearsed; a lurid tale of alcohol-fuelled teenagers running amok (“I blame the parents”); the comparison made between alcohol and drugs; and finally a reminder of the slippery slope “addiction is really just an extension of a bad habit and ‘there but for the grace of God go I.’” He missed out bashing alcopops and strong white cider, but otherwise all the buttons were pressed.
Let me start with his comments about the impact of education. The gist of it is he doesn’t think alcohol education has much of an impact on the drinking culture, it doesn’t work; unlike propaganda, which I suspect is what he’s really in favour of. I have to say, I feel more than a little incredulous when a learned academic, a research fellow, a man with more letters after his name than a large tin of alphabet spaghetti pitches up to tell us education doesn’t work!
Indeed, he goes further and suggests that education might actually backfire because it “encourages rather than discourages experimentation” (with alcohol). This ‘ignorance encourages abstinence’ approach characterised 19th century temperance, and was also the basis on which Mary Whitehouse and her ideological descendants opposed sex education – it just makes them want to give it a go! Perhaps Dr Foster could provide us with some examples of where culture change has successfully been achieved by suppressing knowledge and promoting ignorance?
More to the point, there is evidence that alcohol education does work. For the past eight years Diageo has sponsored “Smashed”, an interactive theatre education workshop, which educated young people about the risks of underage drinking. Following the 2012 tour, 98 per cent of participating students said they understood alcohol misuse can damage their health; 96 per cent said they understood it can affect relationships with friends and family; 98 per cent said they understood the relationship between drinking and accidents. “Smashed” has so far reached 195,000 young people in 1,100 schools and will be touring again in 2013. But for Dr Foster, all this is just putting ideas in their young heads, might backfire, and anyway it’s just subliminal advertising.
Furthermore, the latest NHSIC report on smoking, drinking and drug use in England in 2011 has shown that:
• The proportion of pupils who drank in the last week has fallen by eight per cent since 2010 and by 54 per cent since 2001
• The mean weekly amount drunk by pupils that did drink fell by 20 per cent since last year
• The number of pupils who have never had a drink has risen by 40 per cent since 2001
Dr Foster: you’re a research fellow. So read the latest research.
Foster also addresses the relationship between consumption and price: “As the alcohol industry will not tire of telling you there is no proof of a causal relationship between alcohol consumption and price….” Well, actually the alcohol industry makes no such claim, and if it did it would be wrong. Why does Dr Foster think the industry is campaigning for a reduction in VAT to five per cent in pubs, and an end to the alcohol duty escalator? It is precisely because we do understand that demand for alcohol products, like the demand for any other product, responds to increases in price. Any ‘A level’ economics student could tell you that – it’s simply obvious.
The issue is not whether price rises would lead to a fall in alcohol consumption, but whether there is a causal relationship between the fall in consumption per head across a whole population, and a reduction in alcohol-related harms. The ‘whole population’ approach, of which he is an advocate, is a theory in desperate search of evidence. The last six years has seen the ground move beneath it. An 11 per cent fall in alcohol consumption whilst alcohol-related harms continue to rise – the opposite of what those seeking to suppress the mass market in alcohol believed would happen.
And then he goes on to make the comparison between someone who is looking forward to going home “where there will be a nice glass of something cold for me” and consumption of illegal drugs. He suggests that if “glass of something cold” was replaced with a “line of coke” or “syringe of heroin” it wouldn’t have quite the same ring to it. It’s fashionable these days for moral campaigners to enter the public confessional, so Dr Foster ruefully admits in his blog that “Alcohol is fun, I am a drinker…” Well, Doc, now you’ve had your “I’m Spartacus” moment, perhaps you could tell us precisely how alcohol was fun for you? Can you honestly say having a drink felt like snorting a big fat line of Columbian, or ramming a syringe full of heroin into your arm? And how would you know?
We all make our pitch to consumers in the same market-place of ideas. This creates individual choice. I suspect Dr Foster doesn’t like the idea of education or advertising because he believes that if you give people a choice they’ll make the wrong one! That’s the problem with folk, isn’t it Dr Foster? They can resist anything except temptation. For you, the difference between ‘responsible drinkers’ and ‘alcohol addicts’ is just a matter of how far down the slippery slope they are. So, like the temperance campaigners of Victorian Britain you’ve come to the conclusion that only coercive legislative reform will do. Take the ideological blinkers off, and give credit where credit is due.
Paul Chase is a director of CPL Training and the UK’s leading on-trade commentator on alcohol policy

The right approach to marketing by Ann Elliott

Our briefs, on the whole, are focussed on getting ‘bums on seats’ for multi-site operators. We use a mix of digital communications, PR, social media and neighbourhood marketing to do this. We develop the plans and we implement them.

Quite often though there is a real debate with the client about the level of involvement they want their teams to have in developing and implementing these plans at pub or restaurant level. That’s particularly the case when these plans involve social media and neighbourhood marketing. I can appreciate both sides of the argument and, at the end of the day, it has to be the client who decides what she wants her team to do both in head office and at site level.

On the one side are those who want their teams at site level to be totally involved in marketing their pub or restaurant. They want them to tweet, to update facebook and to respond to reviews every day, be they on booking engines or on sites like Trip Advisor. They want them to be responsible for their mailing lists.

They also want them to be the people who know their local neighbourhood like the back of their hands. They should be the ones, they argue, who need to know the concierges, the event organisers, the key opinion formers, the school heads and the PAs in local businesses. This local knowledge is vital, they feel, in keeping their brand’ top of mind’ with the community who are most likely to visit, recommend and revisit. It helps them understand what’s going on and to be at the heart of what’s going on - it also means they keep a close eye on competitors.

This approach means that in each site there must be someone who not only knows the principles and detail of what they need to do but also has the enthusiasm and energy to put them in place. It also demands a thick skin, a huge amount of self-confidence and outstanding emotional intelligence. Companies who adopt this approach still need to make sure that they support their operators on the ground by providing the training, information and materials they need to make a success of their social media and neighbourhood marketing activity.

On the other hand, I work with a lot of operators who just want their operators to operate. They don’t want them distracted by any involvement in marketing of any kind. Sometimes these clients fundamentally believe that they don’t really need to ‘do’ marketing and that an outstanding pub or restaurant, run outstandingly well, will generate its own success without the need for any sort of marketing.

If they are persuaded that marketing can be beneficial then they want this done centrally or via an external resource (often us). They want that resource to tweet, update social media sites and keep their own websites fresh and relevant. They want that resource to be the one that makes contact with local bodies and businesses. They want this individual or team to ‘get bums on seats’ and the only role they want their managers to play is to ensure that those customers have the best possible experience. Word-of-mouth, they argue (and who can disagree), is the best possible form of marketing.

Whichever approach operators take, they have to make it very clear to all involved. They have to ensure everyone involved in marketing at any level is clear what role they have, where their responsibilities lie and how they will be measured. I respect both approaches because both, I think, put the customer at the heart of what they do.
Ann Elliott is chief executive of Elliott Marketing and PR

How we are re-building Luminar by Peter Marks

It has been eight months since I took over at Luminar, and we have made great strides in putting the company back on the rails. Our strategy is a simple one. With the shackles off, we have gone about trying to rebuild the business by using common sense. We have decentralised decision making back to the club management, reduced the head office and are applying greater operational intensity with more regional management whilst others have cut back. With short decision lines we are fast on our feet and we are reaping the benefits of this. 

The last piece of our strategy has now commenced - the much-needed refurbishment plan. We are currently on site in York and Aberdeen and others will quickly follow. For all the best management practices, you cannot win a loyal and regular customer if you are running tired and out-of-date premises, and this was at the heart of the problem in the first place. Much trade was lost to bars and newer clubs, but it can be won back again with a good refurbishment, sensible pricing and good management. There are plenty of examples of this and many successful clubs, yet there are those that think nightclubs can’t survive in this market. I completely disagree. The latent potential within the estate is huge. We have well-located premises and with sensible investment we will transform the clubs.

All this said, there are also frustrations. The regulatory environment is getting ridiculous. I have always tried to think like a customer and put customer experience at the forefront of our thinking. Yet I am told repeatedly that we should have plastic ‘glasses’ in some of our clubs as one glass incident is one too many. This is usually driven by policy not facts! If I go plastic we end up with a poorer demographic (and usually more incidents) as better customers go to other venues or stay at home. 

Discounts and offers are also an issue. We have the most price sensitive market for years. Over 40 per cent of under 24s are either students or unemployed, which is why drinks deals are necessary. We are all up against the supermarket selling drinks for 40p. None of us want to discount, but I did not create the recession, I am merely responding to it. We manage our venues professionally and incidents are thankfully very few and far between, but, of course, always reported. We are picking up the tail-end of someone’s night out so have always had some issues, but less than ever before in my 30 years as an operator. To read the press you’d think there were more. There are not. People have short memories of how it used to be - I love the saying, “The older you get the better you used to be!”.

As we seek to build a sustainable business another challenge is ensuring we have the right level of rents. We are not greedy, nor are we ignorant of some of the problems landlords themselves face. But the simple fact is that you can afford ten per cent of your turnover to be rent in a standard year. It doesn't matter who your tenant is, if it is much more than this then it works for neither party in the long run. There are four venues that I was unable to reach agreement on with this in mind. It is a landlord’s prerogative to take their unit back once we have removed our equipment, but long term partnering with another who is prepared to pay a more than full rent will come back to haunt them.

In conclusion, I am confident we can rebuild the business, and, when the time is right, grow. I am under no illusion that it will be a lot of hard work. But I am encouraged with what we have achieved thus far. The investment programme will take us to the next level. I believe that a great club is a benefit to any town centre; we just need to make them great again and be helped, not hindered, by the authorities.
Peter Marks is chief executive of nightclub company Luminar

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