Marketing to the changing Filipino diner

Retail Food Service in the Philippines is a dynamic, rapidly changing industry — and an unforgiving place for businesses slow to adapt to the changing preferences of the Filipino diner. A stroll through any commercial area will easily confirm this. Restaurants and eating-places are everywhere, from fine dining palaces to food court kiosks, from coffee shops to carinderias, from quick service restaurants to stand-up counters at gasoline stations.

Everyday you see, hear or read about new restaurant brands being introduced, outlets opening, companies expanding. Just as often, you probably notice storefronts that were there yesterday are now boarded up today for the construction of a new dining outlet that’s opening tomorrow. Visit any place you have not been to recently, and its more than likely that quite a number of the stores you remember are no longer there. Succeeding in this increasingly competitive environment is not a matter of chance.

The Filipino diner is a sophisticated, discriminating consumer whatever her (or his) income level or demographic. Understanding her and ultimately meeting her needs successfully are no small feats. Change is the order of the day for the Filipino diner. Sustained business success comes from a deep understanding of this change, and genuine insight on how to tap into this forward momentum.

Anticipating and addressing what the Filipino diner wants is vitally important to continued success. Jollibee Foods has led the market for many years. Last year, the company grew systemwide sales by 13.5 percent to over P45 billion, while net income increased almost 17 percent to over P2 billion. For the 8th consecutive year, Jollibee Foods was recognized as the Most Admired Company in the Philippines. Its brands—flagship Jollibee, Chow King, Greenwich, Delifrance and Red Ribbon— have grown their margins of leadership by being in the forefront of change.

How is the Filipino diner changing? Here are a few of the changes that are already emergent, together with examples of how one business is addressing these.

Loyalty: What have you got for me today?

More Filipinos are eating outside of their homes more often. This trend is expected to accelerate in the next few years. It is fueled by an improving economy, the aggressive expansion of malls, the increasing numbers of working mothers, and longer and more varied working hours. With this trend comes an explosion of dining alternatives and greater competition from both local and multinational brands. All across the country, there is a widening range of choices available to the Filipino diner. Gone are the days when there were very few reliable places to go to, with most alternatives providing poor or inconsistent quality. The diners of the past looked for the reassurance of reliable brands or outlets for taste, value, overall quality— and gave them their loyalty.

Today, this reliability is more likely just the “price of entry” into the category. Most major brands offer reasonably good taste at the right price in their segments. This is no longer enough: brands have to serve up more “news” more frequent change, in addition to their basic offerings. Today’s diners, particularly the younger ones, are used to being constantly stimulated. The television, Internet, telephone all provide a multitude of virtual experiences. They’re trying more new things, making more diverse contacts, traveling further afield. They are emailing, texting, blogging.

For restaurant brands to thrive in this changed environment, change needs to happen in them as well. Today’s diner is asking for innovation— more, faster, and better. For example, in the pizza/pasta segment of the market, Greenwich has maintained its leadership with a stream of product innovation, including the launches of the Pizza 2007 primo and crunchy crust offerings, the Supreme line of pasta dishes, novel beverages and new sides. These innovations keep the brand new, fresh and appealing. This is why Greenwich serves more customers than any other pizza/pasta restaurant chain in the country.

Going global, eating local

The population diaspora is changing attitudes and influencing choices in many ways. The numbers are interesting. Well over 8 million Filipinos live and work in about 120 countries around the world. Almost 10 percent of the population live abroad. When you consider that these eight million expatriates belong to the 15 million household base of the Philippines, its clear that there is a huge change going on that reaches deep into our culture, habits and preferences. In the 100 years since the first significant wave of Filipino migration (many as field workers in Hawaiian plantations), we have welcomed the experience of new flavors from new places.

Because of this influence, the Filipino diner is willing to try what’s different, and bring diversity to her list of preferences. This is why non-traditional” food “like pizzas and pastas“ are now well-accepted regular fare, and the reason why a brand like Greenwich has been able to expand to a network of over 240 stores from Tuguegarao to General Santos.

Despite the growth of “imported” tastes and food items, Filipino flavors and dishes remain the most preferred kind of food that dominates the menu in most restaurants (even in those outlets focused on non-Filipino cuisine). Even Gen-Xers and Gen-Yers tend to be sentimental about food that evokes a sense of tradition and belonging. Meld this preference with the well-accepted “foreign” flavors and food items, and very often the results can be a surprisingly delightful fusion.

The Filipino diner is indeed globalizing her preferences, but in a distinctly Pinoy way.

Healthy eating: Do good, taste good

Wellness is definitely a growing factor in the Filipino diner’s food choices. The global consumer trend towards dieting and healthy eating that reduces the intake of fats, sugar, and salt has definitely taken on in the Philippines. Married Filipino males and females now rank health and fitness as their most important priority, while single young adults rank this as their #2 need. 50% of urban Filipinos believe they are overweight, while fully 83 percent claim they are trying to lose weight. The Filipino diner is now more aware of the importance of a healthy lifestyle. She rewards with her preference those brands that offer her alternatives that fit this changed need without compromising the “basics” of great taste and a reasonable price.

Quick service restaurants are beginning to capitalize on the wellness trend. A case in point is Greenwich’s recent successful launch of its Delicious ‘n Light menu choices. The new menu line includes pizza variants specially formulated with lower-calorie ingredients like leaner meat, and an assortment of herbs and vegetables; a heart-healthy tuna and tomato pasta; a fruit cup with no added sugar; and a vitamin- and mineral-enriched juice drink. The launch included the offer of a “DeLight” card, which entitled the brand’s fitness-conscious diners to free workouts at a chain of gyms.

The Filipino diner is sending the clear message that offering more healthy choices helps keep business healthy too.

Looking forward: Enormous potential

Beyond these examples, there is certainly no shortage of emerging consumer trends that food marketers can capitalize on to grow their business. Among them: consumers’ need for convenience and the rise of call centers (ubiquitous 7-11s, 24-hour fast food operations); the increasing awareness of food safety and the importance of hygiene fed by much-publicized health scandals (headline: UN raises food-safety alert); the greater need to “wind-down” from a stressful lifestyle and the tremendous growth of cafes (Starbucks, Bo’s, Figaro and other specialty coffee shops); the desire for greater connectivity, relationships and celebrating special times (party planners, “barkada” special offers); the heightened concern for the environment and the use of organically-grown ingredients and sustainable farming practices.

The list of trends that could lead to potentially big business opportunities goes on and on. It is limited only by our ability to perceive them, particularly in their nascent stages. This is the hardest part of the challenge to be successful at retail food service. It requires a consistent, sustained commitment to stay close to the Filipino diner, listen to her, and articulate her wants and needs — even before she herself can verbalize them. And then, of course, meet those wants and needs better than anyone.

Amidst all the change that is happening around us, the one thing that is not changing is that first (familiar but oft ignored) rule of successful brand-building: Understand your consumer.