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Food & Beverage Industry

Brand U: doing business in a college town

Nation's Restaurant News, April 26, 1999

Call it 'branding by being there There are positives and negatives involved in running a restaurant in any type of college town. Operators can be successful, but they must adapt to the ebb and flow of students.

College towns have their own special atmosphere and rhythm: the build-up to fall term, when students pile hack into town and faculty hurry to assemble syllabi; the great emptying-out over the winter holidays; and the restless, undulating swarms of undergraduates who pack the downtown on weekends, lurching around the crowded streets looking for beer and company.

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Running a restaurant against such a backdrop has its own peculiarities, especially if an operator wants to cover himself in some of the glory -- athletic and otherwise -- conferred by O1' State. This can be tricky, and depends on the town or city and the type of restaurant involved. An operator can't expect all of those students, faculty and staff will beat a path to his door the minute it swings open.

"Outsiders think that it's a better market than it really is," says Christopher Muller, assistant professor of chain restaurant management at Cornell University's School of Hotel Administration. "There are huge cycles and very pronounced segmentation. You've got students with a reasonable amount of disposable income but not good consumption patterns -- they spend on music and clothing.

"Faculty look great on paper, but they spent years earning Ph.D.s, getting by on assistantships and living like church mice. By the time they get teaching jobs, they're almost 30 and have established very frugal spending habits."

Different Types of Towns

Another factor: all college towns are not the same. A rough taxonomy might go like this: type one is a big metropolitan market with several colleges; type two represents smaller cities with one dominant university and other sorts of industry; and type three is a town whose very existence depends on the presence of the university.

Muller acknowledges that in a type-three college town, any restaurant near the campus becomes, in effect, an endorsed brand: its mere proximity to the university confers marketing power which a smart operator can use to his advantage.

One fortunate recipient of this branding-by-proximity magic is Lisa Chorey, general manager of the Cooker Restaurant right on the campus of Ohio State University in Columbus.

Branding by Being There

Chorey is the beneficiary of a type-three situation in a type-two city: Columbus is the capital and the seat of state government. But the fortunes of real estate render the restaurant much more like those in "true" college towns. The Cooker is an easy walk from OSU's two main athletic venues and only a little further from the new Schottenstein Center, which features concerts and other entertainments. Call it branding by being there.

"Sixty to 70 percent of our business is university-related," she says. "I know that because when there are no events on campus, we can expect a slow-to-medium day."

But something is almost always happening on a campus the size of OSU. And even when there isn't, the restaurant, nestled among dormitories and academic buildings, is a logical destination for students and faculty alike.

In fact, Chorey has given up on advertising. "When I first came here two years ago, we were in those student coupon books -- anything we could do to get'em. We don't need to do this now; there really is nowhere else to go without driving."

The only real marketing thrust is the adoption of OS U's colors -- scarlet and gray -- for the restaurant's awning, instead of the standard Cooker scheme.

The customers at Cooker represent a healthy slice of the typical segmented university market. Chorey says: "Lunches, we get mostly faculty and staff. Dinners, we get students because our prices are reasonable. We also see faculty for after-work meetings."

Echoing a near-universal theme, Chorey adds that undergraduate drinking is not encouraged. Beer at the Cooker's bar is priced to discourage excess, and the restaurant is next door to a legendary campus watering hole -- The Varsity Club. Chorey says students come to Cooker to eat, but go next door to drink.

Even restaurants which sell a significant amount of alcohol are trying to appeal to the older crowd. Kevin Clyde, owner of the Henderson Street Bar and Grill in Chapel Hill, NC., has set his price points to discourage undergrads in a town otherwise dominated by students of the University of North Carolina.

Keeping Out of Trouble

"I target locals and grad students more than the undergrads." he says. "There's less trouble, everyone's of age. and they don't tear the place up. I price higher and I never do specials. which pretty much rules out your undergraduate crowd."

Clyde likes the older grad students, especially MBA students who are often subsidized by employers when they return to school, and have a little cash to spend.

Food & Beverage Industry

Brand U: doing business in a college town

Nation's Restaurant News, April 26, 1999

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