How to determine the target market for a restaurant?

How to determine the target market for a restaurant using the design thinking process? Most of us have seen this situation, a crowded restaurant with a long queue and beside it is a restaurant that is totally empty.  

And the reason is simple - they did not manage to attract the right audience also known as the target audience. 

In this article, we are using the design thinking process to determine the target audience for a restaurant. The location is set in Tampines Mall, Singapore. 

Now, imagine if you are going to set up a new restaurant in this location, Tampines Mall, Singapore. The first question is the traffic flow and based on observation and clicker study, the traffic flow in Tampines Mall is good. 

Next is, to determine if this location has the right target market for your restaurant. Using the first process of design thinking (empathy), we will look at the different extreme users of different food and beverage segments within Tampines Mall. 

How to determine the target market for your restaurant? 

Step 1: Identify a few restaurants in that location 

  • It must have 2-3 restaurants that are your direct competitor
  • It must have a niche restaurant. 
  • It must comprise of a mass-market restaurant, such as a fast-food restaurant 

Step 2: Identify the extreme users for each segment of the restaurants identified. 

Do note that the extreme users vary, even restaurants in the same segment, e.g. Macdonald’s and KFC will have slightly different extreme users, although they are both in the quick-service restaurant (QSR) segment. 

The video below is a class exercise on extreme users based on the location, listen to what the students shared about the various groups of extreme users for the different restaurants. 

Step 3: Ask each group of extreme users these questions:

  • How often do they visit each restaurant? 
  • Why are they coming to this restaurant? 
  • What will deter them from going to the restaurant? 

The collection of data from step 3 will give you a good representation of: 

The reasons consumers are visiting all the restaurants you have identified. And if interviewees are visiting your direct competitors, not because of the value proposition that you have created, then you will need to relook and test out a different hypothesis. 

For example, if the data shows a very price-sensitive audience, and their response are related to low pricing, which is not in line with your value proposition then you need to either reconsider this location or see if there is a possibility in running an MVP in this location first. 

At the time of this article, the industry is going through an unprecedented crisis - the COVID19. Many countries have gone through a lockdown and are struggling with a reopening. The fact is the consumption pattern changed because of the regulation of safe distancing that are still in place and also the psychological makeup of the shopper (they may be worried to go out for dining). 

It is advisable to do another round of extreme user testing to come out with plan and actions suitable for this new situation. 

Read about what we have written for COVID19 marketing

From time to time, we run a free marketing campaign for restaurants, drop us a message if you want to be part of the free marketing to drive traffic to your outlet, read more about what we have done previously in our restaurant marketing guide

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OCM was started in 2007, focusing first on coffee machines, then marketing for coffee and food and beverage companies. Check out this restaurant marketing guide to learn more about the many campaigns and companies we have worked with. 

OCM has also created many marketing workshops and classes for the F&B industry. Many of the modules are running in the Singapore Skillsfuture Classes in tertiary institutions such as Temasek Polytechnic Skillsfuture Academy and also ITE College East COC classes. 

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