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Solve the online difficulties faced by small and medium-sized catering businesses from a marketing perspective.

Food is the most important thing for people.

Both at home and abroad, the ups and downs of the catering industry are seen as an indicator of economic vitality.

The reality is that the core track of the recovery and warming of the consumer market will not be without the frequent popularity of the catering industry. Taking the past 2023 as an example, new catering formats such as fine dining represented by bistros continue to emerge offline, and the online local life track battle is restarted, with catering as the highlight, and the battle is hot.

The reality is that from local search to O2O, from short videos to live broadcasts...it has become a new normal for catering businesses to embrace online traffic, build their own private domain operation systems, expand group buying, grass-planting and other business links, and look for new growth.

The catering industry still has dividends, but not everyone can get them. After all the ups and downs, big brands and big chains still have the possibility to withstand risks. As the silent majority in the catering industry, how can small and medium-sized businesses cope with the storms and even break through and surpass others?

01New catering business, new opportunities for small and medium-sized businesses

The catering industry has clearly picked up. According to the "2023 China Catering Opening and Closing Store Report" released by NCBD, in the recent year of 2023, the revenue of China's catering market exceeded 5 trillion for the first time, reaching the highest level in history.

Correspondingly, small and medium-sized catering businesses are facing a relatively fierce red ocean. In 2023, the number of newly registered catering businesses will reach 3.18 million, of which 98.3% have a registered capital of less than 1 million, while the number of deregistrations will be 1.39 million.

Clearly, the market industry has changed.

It is undeniable that compared with large-scale catering brands that have generally entered the online development, most small and medium-sized catering businesses still rely on physical stores and regular customers as their basic base, and have no intuitive feeling of the digital wave.

The tide is surging, but the water is slow. A vivid example is that most of the digital transformation of offline physical stores, such as scanning code to order and scan code to pay, has been completed. In essence, this kind of consumption behavior is a shift in social groups and an upgrade of social habits, which is subtle and gradual with the gradual improvement of infrastructure.

For merchants, introducing a POS machine or a set of ordering and takeaway systems is no different from installing a light box, making a menu and placing a delivery phone in the store. It does not involve user orientation, but only user experience.

However, when the main consumer groups completed their iteration and the younger generation of digital natives came onto the stage, consumer behavior and consumer chains had undergone fundamental changes, and became the key to determining the survival of businesses in the following years.

To be more specific, social media such as TikTok and Xiaohongshu have spread their tentacles into the lives of young people, far deeper than before. Traditional social relationships among acquaintances have been spread through the Internet into public activities between "strange acquaintances."

People are willing to believe a stranger’s personal experience in a Xiaohongshu note, and are also willing to try a group purchase meal that looks delicious in a Douyin short video - even if they have never heard of this restaurant before.

For most catering companies, they have passively entered the digital transformation and online operation mode. Catering companies with a certain scale can also form new organizational capabilities according to the changes in digital business, and gradually form a marketing strategy suitable for themselves in practice.

Small and medium-sized catering businesses are different. New product live broadcasts, product recommendations, group purchase short videos, and traffic investment are not their strengths. Even if there are operators who want to embrace change, they are still subject to operating costs and complex platform rules. This makes it impossible to achieve operations, marketing, and other business actions that should have found the best solution through trial and error, and the online participation capabilities of small and medium-sized businesses are limited.

However, in the digital age, having both online and offline capabilities has almost become standard. Only by mastering the operation of online digital stores can you grasp future victory.

02 Find the key

The essence of the catering industry is a business of customer flow.

With customer flow comes conversion rate, with conversion rate comes cash flow, with cash flow comes expansion, renovation, and service improvement... It is no wonder that overseas markets where the restaurant chain industry is relatively mature believe that the core of the restaurant business is "Location, Location, Location (site selection, location selection, and location selection)".

Good business districts are the battleground for branded restaurants, and densely populated communities are the foundation for small restaurants to survive... Traditional restaurant owners' requirements for location are exactly what matters to physical restaurants. In the traditional environment, one way for the restaurant industry to gain traffic is through the blessing brought by the geographical location.

Now, the relationship of acquiring customer traffic has changed. If we use e-commerce as an analogy, the traditional catering model was more like "people looking for goods" in the shelf display style, physical store display, word-of-mouth recommendation, and the in-store and takeaway business in the first generation of digital transformation were also display-style recommendation sorting.

As social content platforms have truly become mass-market applications, the catering industry's matching methods have also begun to converge, turning to interest-based, grass-roots-style "goods find people". The link of content reach, interest stimulation, and transaction conversion has been successfully verified in the e-commerce field and replicated in the catering industry.

This means that the business field of catering businesses is expanding and opportunities are emerging. Whether they can complete the online transformation is the key to this great commercial voyage.

Small and medium-sized catering businesses do have natural disadvantages. They are insufficient in size, have limited budgets, have incomplete organizational structures, and even under the same quality, their profits cannot compare to chain brands that have their own supply chain and centralized procurement cost advantages. However, this does not mean that they should withdraw from the new environment where opportunities and competition coexist.

There needs to be a bridge between the platform and the merchants. It seems natural that service providers have become the digital ferrymen for some small and medium-sized merchants to break through.

Zhu Chenhao, co-founder of Zaihui Technology, believes that "it is inevitable that the proportion of online revenue in the catering industry will surpass that of offline revenue in the future", but the process of onlineization is irreversible and will eventually reach all platforms from point to surface. In this process, how merchants can participate in the operation and marketing links of various mainstream platforms to the greatest extent becomes the key.

Zhu Chenhao, co-founder of Zaihui Technology

It should be pointed out that the so-called small and medium-sized catering businesses are closer to the "waist" of the industry. They are neither large chains nor mom-and-pop stores, but a group with a small number of branches. The pain point of these businesses is that the operation of physical stores is taken care of by the store manager, but there is no one to take care of the process of digital transformation. Especially in the face of competition from both ends, the pressure faced by mid-level businesses can be imagined.

Zaihui's target group is precisely this group of mid-tier players. In 2023, it will focus on thinking about and exploring how to solve the online difficulties of small and medium-sized catering businesses from a marketing perspective.

Specifically, on the one hand, Zaihui can help merchants streamline their business operations such as group buying, influencer cooperation, and account operation on social media such as Douyin, Xiaohongshu, and even Bilibili, so that the tedious work that merchants should have undertaken can be transformed into "service products" that can be used directly. On the trading platform, Zaihui integrates standardized operational actions with personalized business concepts, and jointly builds digital stores for catering merchants with social media, drawing traffic for merchant growth from the vast public domain traffic.

On the other hand, it helps catering businesses build a SCRM sedimentation traffic pool based on WeChat and WeChat for Business. As a catering SaaS service provider, Zaihui has accumulated its own capabilities and can find commonalities from massive user behaviors and find models that can improve store conversion rates. This forms a complete set of solutions for the catering industry from public domain operations to private domain sedimentation, from online to offline.

It is worth mentioning that, in response to the needs of different businesses, ZaiHui can disassemble the already standardized and process-based marketing services and provide them in a way that is more in line with the actual business situation. For example, a bistro in Chongqing, as a new catering format, has a core demand for reaching and exposure through online channels. Through ZaiHui's completion of Dianping KOC notes, store visits increased by 69% week-on-week.

The same applies to merchants who are upgrading their brands and expanding their stores. Dusushijia, a local brand in Shanghai, has begun to try business transformations such as store broadcasting and group buying while upgrading its brand. After cooperating with Zaihui, through in-depth analysis of brand products and target audiences, it has built a group buying system, matched appropriate talent resources, and actively iterated the store group meal design, carried out brand promotion and product sales for the brand, helped the brand break through the consumer circle, and achieved a monthly revenue growth of more than 500%.

It can be seen that Zaihui's advantage lies in its full-link solution and decoupled service capabilities for small and medium-sized businesses, making Zaihui an external management brain for small and medium-sized businesses and solving their problems of lack of talent and scale.

In addition to digital capabilities, the marketing capabilities represented by Douyin group buying and influencer promotion can also enable Zaihui to help transform catering brands of a certain size. Taking a chain brand with obvious regional presence as an example, Zaihui created node-specific hot products for it, including the August back-to-school season promotion, using freshly baked mooncakes as the core of Douyin group buying, and other marketing activities. According to Zaihui's relevant data, after only four months of cooperation with Zaihui, the Douyin channel transaction volume achieved a 79.9% increase.

Traffic and retention are the two carriages that drive business growth for small and medium-sized catering businesses.

03 Re-Benefiting Growth

When it comes to Zaihui, many people may still think of it as a catering SaaS service provider. The change in identity is a response to customer demands and market changes, and also an attempt to agilely iterate its own business model and find new curves.

In addition to SaaS business, Zaihui has already established MCN organizations and reserved relevant resources for influencers. After launching the marketing business, with its familiarity with the ecosystem of Douyin and Xiaohongshu platforms and its understanding of the pain points of small and medium-sized businesses, it has built a full-link service solution from methodology to resource matching.

One key point is that Zaihui’s foothold is to help catering businesses achieve conversions within a limited budget, so that more businesses can personally participate in the wave of transformation and change, rather than being swept away by the times.

For the platform, the needs of small and medium-sized businesses are activated through service providers represented by Zaihui, becoming a new supplement to the ecosystem and feeding back the business growth of small and medium-sized businesses. Data from the Douyin Life Service Platform shows that the average business performance of businesses has increased by 30% after cooperating with service providers.

Of course, not all businesses can seize the opportunity 100%.

"Online channels are not only a supplement to offline stores, but also a second store." Zhu Chenhao believes that catering businesses in the new environment need to transform not only the model, but also the ideas. Just like in the Age of Discovery, not all captains can successfully reach the New World. The difference is that the main axis of many catering businesses is still in offline physical stores. Although the old sea charts in hand do not have reefs, they have deviated from the new route.

For Zaihui itself, the development of marketing business is also a supplement to its own territory. At present, Zaihui's customer base is mainly in first- and second-tier cities, which happen to be key areas with high penetration rates of local life and grass-seeking. Its related business has been in trial operation for one year and has generated revenue of over 100 million yuan. Correspondingly, more merchants have achieved business growth through Zaihui.

In Zhu Chenhao's view, Zaihui has always had only one business, which is "how to help merchants reduce costs and increase efficiency." While consolidating the existing SaaS business, it is exploring more ways, and the exploration of social media marketing links such as Douyin and Xiaohongshu is one of the signs.

Business is a game for the brave, and catering is even more of an adventure. In the digital wave, small and medium-sized businesses need more people to ferry them and "re-benefit" the future.