The Rise of Subscription Services in the Restaurant Industry and the Role of Growth Product Managers

Glasp

Glasp

Aug 11, 20233 min read

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The Rise of Subscription Services in the Restaurant Industry and the Role of Growth Product Managers

Introduction:

The COVID-19 pandemic has forced many industries to adapt and find innovative ways to survive. One such adaptation in the restaurant industry has been the introduction of subscription services. Restaurant chains like Dickey's Barbecue Pit, Panera Bread, Burger King, and Cumberland Farms have all experimented with subscription models to attract and retain customers. In this article, we will explore the potential longevity of these subscription services and discuss the role of growth product managers in driving their success.

The Emergence of Subscription Services in Restaurants:

Dickey's Barbecue Pit, a popular Dallas-based chain, introduced a "meat box" subscription service that allows customers to receive monthly deliveries of barbecue meats. With prices ranging from $100 to $280 per month, the company shares only 5 percent of the revenue with franchisees. Panera Bread, on the other hand, launched an $8.99-per-month subscription for unlimited coffee and hot tea every two hours. Despite not disclosing the number of subscribers, Panera Bread reportedly signed on 800,000 customers, with 500,000 becoming paid subscribers. Similarly, Burger King and Cumberland Farms experimented with coffee subscription services, but both initiatives were canceled within a few months.

The Appeal of Restaurant Subscriptions:

The success of restaurant subscriptions can be attributed to various factors. Firstly, the subscription model provides customers with a sense of value and convenience. By paying a fixed monthly fee, customers can enjoy unlimited access to their favorite food or beverages, which encourages them to visit the restaurant more frequently. Additionally, subscriptions offer a sense of exclusivity, with customers feeling like they are part of a special club or community. Lastly, subscriptions can help restaurants generate a steady stream of revenue, especially during uncertain times when foot traffic may be unpredictable.

The Role of Growth Product Managers:

In the context of restaurant subscriptions, growth product managers play a crucial role in driving the success of these initiatives. Their primary focus is on user acquisition and retention, ensuring that the subscription service reaches as many potential customers as possible and keeps them engaged. Growth product managers employ a multi-disciplinary and data-driven approach to scaling products, utilizing a combination of product and marketing strategies.

Key Areas in Growth for Restaurant Subscriptions:

To maximize the success of restaurant subscriptions, growth product managers need to consider various key areas, including acquisition, virality, search, paid advertising, affiliate marketing, retention, and engagement. Each of these areas contributes to the overall growth of the subscription service and requires a balance of art and science.

Actionable Advice for Growth Product Managers:

  • 1. Prioritize the core value of the product: Growth product managers should focus on ensuring that users experience the core value of the subscription service as often as possible. This means constantly improving the quality of the food or beverages offered and addressing any potential pain points.
  • 2. Embrace rapid experimentation: To achieve sustainable growth, growth product managers should encourage a culture of rapid experimentation. By continuously testing and learning from different strategies, they can identify what resonates with customers and iterate accordingly.
  • 3. Foster cross-functional collaboration: Growth is a cross-functional effort that requires collaboration between product, marketing, and other teams. Growth product managers should foster an environment of collaboration and encourage teams to work together towards common goals.

Conclusion:

The rise of subscription services in the restaurant industry presents both opportunities and challenges. While some chains have achieved success with their subscription models, others have faced setbacks. The key to maintaining the longevity of these services lies in the hands of growth product managers who can leverage their skills in acquisition, retention, and experimentation. By prioritizing the core value of the product, embracing rapid experimentation, and fostering cross-functional collaboration, growth product managers can drive the success of restaurant subscriptions in the long run.

Resource:

  1. "To survive the pandemic, restaurants are offering subscriptions for bottomless coffee and beer. Will the model last?", https://thecounter.org/restaurant-subscriptions-coffee-beer-covid-19-pandemic-panera/ (Glasp)
  2. "Airbnb Product Manager Tells You How to Become a Good Growth PM", https://productschool.com/blog/product-management-2/growth-product-manager-airbnb/?utm_source=blog&utm_medium=blog&utm_campaign=WeeklyArticles (Glasp)

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