Effective Strategies to Lower Price Sensitivity in the Restaurant Industry

Effective strategies to lower price sensitivity in the restaurant industry

What factors contribute to price sensitivity in the restaurant industry?

• Aggressive loyalty programs and frequent discounts can condition
  customers to expect lower prices, making it harder for restaurants to
  retain pricing power.
• Poor branding and inconsistent marketing can increase price sensitivity as
  customers struggle to understand a restaurant’s unique value.

How can we combat price sensitivity?

• Consistent and targeted advertising helps build brand awareness and loyalty,
  reducing price sensitivity.
• By investing in branding efforts, restaurants can portray themselves as
  premium, thus lowering price sensitivity.
• Improving product quality enhances perceived value, encouraging
  customers to pay higher prices.
• Exceptional service and personalised experiences build customer loyalty,
  reducing price sensitivity.

Mark Khoder says:

“Discounts and aggressive loyalty programs can condition customers to
expect lower prices, making it difficult for restaurants to maintain pricing
power. Poor branding and inconsistent marketing can also lead to price
sensitivity by making it difficult for customers to perceive the value of a
restaurant’s offerings. To lower price sensitivity, effective strategies include
consistent advertising, increasing brand value, improving product quality,
and enhancing customer experience.”