10 Things Jon Taffer of 'Bar Rescue' Wants You to Know About Running a Business
Who knew that so many business lessons could be learned from running a bar? Award-winning hospitality expert Jon Taffer knew it early on in his career.
After revealing his business revamp process on Spike TV's Bar Rescue, the nightlife consultant is divulging his brick-and-mortar business secrets in a new book, Raise the Bar: An Action-Based Method for Maximum Customer Reactions (New Harvest, 2013), out October 8.
Though the book is a thorough manual to opening and operating a bar or restaurant, Taffer's business insights don't solely apply to Irish pubs and neighborhood nightlife.
"When my company does a good job, we make people happy," says Taffer of best business practices. "They laugh, they smile, they have a good time -- that's what we do for a living. Any business doing that is making a noble effort."
Whether you're starting up a storefront, a social media marketing agency or a software company, here are 10 business lessons from Taffer's upcoming book that you can try:
1. Selling begins once customers "enter" your store. Regardless of whether your selling space is online or offline, customers will only return after a pleasant experience.
Every business process of communication must create a positive customer reaction every time, writes Taffer. "That reaction is the product. Any business, no matter what it is, lives or dies by the customer reaction it creates."
Don't just create great products, but also present them well – onscreen, in-store, at events, etc. – to beat competitors who sell identical products.
2. Consider the lifetime value of your business. With every bar Taffer revamps on Bar Rescue, he isn't hoping to create a once-in-a-lifetime experience. Rather, he's hoping to create brand loyalty.
Taffer explains that the first time customers visit a new eatery, fewer than 50 percent return, because it's still outside their habit cycle. Yet, if they do come back, there is a 50 percent chance they'll return after a second visit and a 70 percent chance after a third. Therefore, don't focus on just giving a great first impression, but also a great third impression.
"This is why transactions have to be held to a high standard and remain consistent and, to a great extent, predictable," says Taffer.
3. Find what stimulates your profits. Since everyone is in the business of reactions, Taffer teaches how to manipulate those reactions for your benefit.
"Most people fall into one of four personality or motivational buckets: money, pride, ego and fear," he explains.
Craft your marketing language to play off of one of these motivators. For example, if your product is a type of insurance policy, outline how your safety net pacifies a fear. If you're selling a new type of personal indulgence, be sure to highlight how good it makes people feel.
4. Treat difficult clients like family. Every entrepreneur entertains those needy, hard-to-please customers, but try to cultivate a new patience by acting as you would with a difficult relative.
Taffer attributes all of his success in customer reactions to his late mother, who required everything to be a certain way.
"My relationship with her demanded that I learn how to understand, predict and react to her shifting energy and moods accurately in order to get results that were the best for both of us."
Just as you wouldn't lash out at your grandmother during dinnertime, hold your tongue around tough clients to deal with them more effectively.
5. Hire for attitude, not experience. Resumés and LinkedIn profiles may read well, but a candidate with the right attitude will boost your company higher than an experienced misfit. Taffer notes that the key to recruiting is identifying the ideal personality for the job (extroverted, supportive, resourceful), and then creating a descriptive job posting that captures it.
"Someone who feels he fits the description will be eager to respond to a job if it ‘sounds like me,'" says Taffer. "Don't understate your case in an ad. Be assertive."
6. Don't coddle your weakest employees. Taffer notes that a common denominator in bad business is that managers view their employees as family, coddling the weakest ones and hoping they one day do better.
This is a mistake, he says. Taffer explains that businesses should be run more like sports teams, where winning players are encouraged and weaker players find themselves facing pressure to improve. "Teams work together on clear objectives that force individual members to perform or leave. If a batter strikes out all the time, his team will use various forms of coercion to make him try harder and do better," writes Taffer. "The coach can't afford to keep them around -- the weakest players must be eliminated."
7. Teach -- don't train -- your team. "Training is behavior modification; it takes too long," writes Taffer. "Teaching is showing someone how to carry out specific tasks and then encouraging them to add their personalities in to make their role come alive." This small change in management perspective will not only help entrepreneurs loosen their need to control every aspect of a business, but will also result in a happier workforce. "You might even learn something from your employees when you let them be themselves and contribute ideas," Taffer writes.
8. Trim down your "menu" to ease choice. Ever feel overwhelmed when you walk into a bar with a countless amount of drinks on the menu? The same concept applies to any business --don't overwhelm your customers with options.
Taffer advises businesses to simplify the selection, present variations of the same product rather than listing them separately (i.e. – have one entry for chicken wings and show they're available in three flavors rather than three different menu listings of chicken wings), bundle offerings into packages and rotate in new products like limited-edition specials.
Doing so also gives clients incentive to return for promotions, special events or simply to see what's new.
9. Always keep your target demographic in mind. Entrepreneurs should always conduct research on their target audience before opening a business and continue those considerations as their business grows.
"More upscale bar customers will not react well to a card or a coupon, but they will react positively to a mailing that looks like a more formal and exclusive invitation -- it's simply a matter of design and delivery," writes Taffer. "The offer and the premise are the same."
From daily Tweets and viral Vines to occasional eNewsletters and annual holiday greetings, maintain a tone that appeals to your target customer and preserves your brand.
10. Innovate realistically to serve your audience. Every business wants to be the next Apple or Google, but don't try while losing all your clients.
"I do not favor innovation over listening to customers -- I favor innovation while listening," writes Taffer. "It's not that I'm against new ideas, but as a businessman, I need it to protect and maximize investments."
Be careful of quirky, weird ideas that isolate part of your client base. Don't get pressured by others in the startup world to deviate too far from the comfort zone that make you successful in the first place.
"An innovation that steps far outside of most people's envelope of expectation can reduce or narrow your market when your aim should be to constantly expand your market," Taffer says.
What lessons do you have for people starting a business? Let us know in the comments below.