Happy Hour Strategies in restaurants and bars is one of the most tried and tested tactic to attract customers and to increase bar sales. Happy Hours are usually specific to bars and pubs, and are created to boost the current sales, and uplift the business during the slow hours. A well-developed Happy Hour program can make a significant difference to your revenues but before you launch your Happy Hours at your bar, remember that offering staggering discounts does not do good to the business and offering uncalculated discounts would only lead to inflated Beverage Costs. Thus, you must devise a smart Happy Hour strategy to generate profits and increase your sales.
What Are Happy Hour Bar Strategies
Happy hour bat strategies are basically marketing strategies that attract customers by offering them something extra at certain times of the day. Mostly used in bars and restaurants, the technique focuses on creating an extra value of an offering in the mind of the customer to improve sales and increase revenue. Happy hour strategy ideas for bars include giving one drink free at the purchase of another, reducing the price of drinks, offering drink combos or drink and meal combos for certain hours of the day etc. Happy hours are targeted towards slow hours of the day to get the drinks and menu items moving at a relatively faster pace when they would otherwise be left unsold.
Do Happy Hour Bar Strategies Increase Bar Sales?
The short answer to this question will be yes. If executed well, happy hour strategies are one of the most effective strategies you can employ to increase your bar sales, regardless of whether you are an independent bar owner, pub owner or a restaurant owner. Happy hour strategies do not simply work on the basis of discounts or free drinks but on the customer psychology to indulge in a something when they see a greater gain. Introducing happy hours in traditionally slow hours of the day will pull in customers as they can see a greater value in your offering now as compared to any other time of the day.
In a study based on a live experiment to check if the success of happy hour strategies all over the globe is a myth or a reality, it was found that sales during happy hours in a bar doubled as compared to sales in the same bar just an hour prior to the start of the scheme. Thus the happy hour strategy not just increased but doubled the bar sales. The study on the success of happy hours is a part of a paper on ‘Beverage Operations Pricing Strategies’ conducted by the University Of Nevada.
Apart from that, there are some more ways in which happy hours strategies increase your bar sales. These are:-
- Happy hours focus on pairing drinks together or food with drinks which improves the sales of both liquor, mocktails and food items at your bar.
- They are especially effective at attracting a new crowd and are a too good a deal to miss for your regulars.
- Happy hours strategies also work to market your bar and restaurant and so establish a brand presence.
- Happy hours create a window for your regulars to visit you more since they have an added advantage of a discount thus increasing your sales during slow hours.
How To Create Happy Hour Strategies To Increase Bar Sales
Now that you know what happy hour strategies are and that they do increase bar sales and overall revenue, next is devising a happy hours strategy. There are certain things that you will have to keep in mind while planning a happy hours strategy for your bar. These are:-
1. Offer The Right Price
A Happy Hour strategy is of course, all about pricing. However, you must take care to not arbitrarily slash the prices. While you cut down the price or offer a drink for free, remember to increase the price of your best selling items to cover the cost. You need to create a balance between your offerings to ensure that you are still making a profit on your reduced markup. Read this detailed guide to Menu Pricing and calculating Food Costs.
2. Create A Special Menu
The menu is the most integral part of the Happy Hour program. This is where you get to cover up for the low priced drinks. Create combo offers of the best-selling, yet high-profit margin food dishes with the drinks. Usually, beers and cocktails along with finger-foods are the most popular option for Happy Hours Menu. Have something exclusive on the menu available only during the Happy Hours to attract customers. Also, there are a number of teetotalers you would not want to miss. Thus, remember to have something for the non-drinkers as well. Target these customers by creating a special combo of mocktails and food.
This article will tell you how to create a stellar bar menu design that is sure to get your bar sales skyrocketing.
3. Target Your Regulars
The most important thing to keep in mind while running any campaign is the Target Audience. You should know what kind of customers frequent your Bar during the Happy Hour, and create the program according to the preferences. Most sales come not from new customers but repeat customers and in the case of bars, regulars are a god mine so focus your happy hour strategies around them. Is your target customer base the corporate workers that visit after Office Hours during weekdays, or the young people coming to your pub for partying?
The day and time of the Happy Hours need to be pre-decided. Usually, Thursdays are slow for business. You can also offer all-day Happy Hours and decide a flat rate for a particular drink. You can also come up with a late Happy Hour special to attract customers to beat the competition.
4. Train Servers To Upsell
It is a well-known fact that restaurant waiters and servers can make a stark difference in sales, and the no-brainer is upselling. Often customers seek the waiter’s advice while ordering. Upselling becomes more crucial during the Happy Hours as customers tend to choose a Combo Offer and place their order. Train your waiters to offer an upgrade on the Combos for an additional charge, or suggest high-profit items on the menu. Waiters upsell best when there is an incentive program; devise an incentive program to keep your staff motivated.
5. Market It Well
Any campaign that you run needs to be marketed well. Apart from the regular display cards and signs, now you can run smart Marketing Campaigns with the help of your CRM. Segment your customer base on the basis of their ordering history and behaviour. If a customer has been known to order drinks in the past, it is likely that they will appreciate discounted drinks. You can send promotional SMS and emails to such customers to ensure the maximum response rate and include these in your Happy Hour Strategies.
6. Measure The Results
The only way to measure the success of any campaign is to look at the numbers. The best way to measure this is to track the Profit Margin per item. Count the total number of each item sold during the Happy Hour, and multiply the number of orders by the Profit Margin per sale. Also, look at the total numbers sold. Could you have increased the sale by promoting the program more?
Happy Hour Strategies are a great way to experiment with new items, understand the customer behaviour along with boosting the revenues. Try it out in your bar and let us know how it went for you!