Developing Social Media Promotional Strategies in the Casual Dining Restaurant Industry: A Case Analysis of Montegro's Italian Grille

By Whang, Yun-Oh; Koutroumanis, Dean A. et al. | Journal of Business and Entrepreneurship, Fall 2013 | Go to article overview

Developing Social Media Promotional Strategies in the Casual Dining Restaurant Industry: A Case Analysis of Montegro's Italian Grille


Whang, Yun-Oh, Koutroumanis, Dean A., Brownlee, Amy, Journal of Business and Entrepreneurship


ABSTRACT

Dan and Jay Montegro along with their business partner, Joe Zito, had owned Montegro's Italian Grille for 17 years. Montegro's was an award winning casual dining Italian restaurant, located in a very busy business district. Since the beginning of the economic recession the restaurant had experienced a significant decrease in revenues. The owners had been searching for new innovative promotional strategies in order to boost sales. Groupon, the industry leader in social media marketing, had been in contact with the owners on several occasions stating that their promotional campaign is just what Montegro's needed to spark sales. The focus of the case decision is on making the strategic, promotional decision whether the small business should pursue the Groupon promotion and evaluate the economic consequences of the decision. The case is appropriate for both undergraduate and graduate level courses in Small Business Management, Entrepreneurship, Promotions, Marketing Research and Hospitality Marketing. The situation described in the case is based on actual events that occurred. All names of the parties involved (including the restaurant name) have been altered to protect their identity.

INTRODUCTION

May 28th 2012 marked a milestone for Montegro's Italian Grille. Montegro's opened its doors on Memorial Day, 1995 and was now celebrating its 17 year anniversary, quite an accomplishment for any independently-owned business. The Italian eatery was owned and operated by the Montegro brothers, Dan and Jay, and a long-time friend, Joe Zito. It had been a staple in the St. Petersburg, FL business district of Feather Cove for almost two decades, with its pasta chosen as "Best in the Bay" by Tampa Bay Magazine from 1996 to present.

However, on this beautiful sunny day in May 2012, Dan looked at the empty tables in his restaurant during the lunch hours, and remembered when it used to be the busiest time of the day with each table turning over more than once. The impact of the "Great Recession" was clearly present at Montegro's even though he could see the light at end of the tunnel. Dan thought about the meeting he had recently with a marketing representative from a leader in social media marketing, Groupon. Montegro and his co-owners had been pondering the question of how to inject some energy to their business.

Background

Montegro's was located in a highly regarded business district where many large corporations were located including the international headquarters of Raymond James Financial and Home Shopping Network. Montegro's served the local business community during lunch hours offering quality food at affordable prices with a classy atmosphere. In addition to the local business professionals, the core target market also included business travelers staying in the area. There were 22 hotels within a 4mile stretch of the restaurant's location, and hotel guests often visited Montegro's for dinner and a glass of wine after a hard day's work away from home. Another core target segment for dinner was the retirees in the Feather Cove neighborhood. It was an affluent subdivision with primarily retired couples who enjoyed the comfortable and personalized service at Montegro's. Montegro's had a split floor plan with a bar area on one side. The other side provided a quiet and relaxing atmosphere where retirees and couples could have a private dinner.

Montegro's Concept

Montegro's was in the casual dining segment of the restaurant industry. The establishment offered a wide selection of menu items ranging from Italian classics such as lasagna and chicken parmagiana to more upscale offerings such as gorgonzola crusted filet mignon with Portobello mushroom. The menu was extensive offering 60 items including appetizers, salads, entrees and desserts. They offered more menu items than the average of their five closest competitors.

The Restaurant Industry - Overview

According to the National Restaurant Association (NRA), the U. …

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