How IHOP's new menu design gets customers to spend more

BusinessWeek

IHOP has a new menu, and now customers are spending more. That’s not a coincidence: The new menu was carefully designed to encourage diners to order more. It’s like a Jedi mind trick that gets customers to order a side of bacon.

According to DineEquity executives, the redesign, introduced in April and in place across the country by June, is responsible for the restaurant’s recent sales boost. “The new menu’s improved layout … prompted guests to trade up and also helped to increase the sale of additional items, such as appetizers,” said Julia Stewart, DineEquity’s chief executive, during an October earnings call.

With an “expert in menu creative development,” whom the company declined to name, IHOP developed a new layout based on customer feedback in tests. We asked Natalia Franco, the chain’s senior vice president of marketing and culinary, to dissect the art of this particular upsell.

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“Guests were making additional purchases and self-selecting higher-priced items that may not have been noticed before,” Stewart said during a conference call.

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“The challenge is real estate. We need space for pictures, because that drives our appeal,” says Franco.

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IHOP gets a lot of visits from families and boomers, who get more attention in the new menu. “There are items meant to retain that loyal consumer base,” Franco says.

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