The anatomy of a successful LTO

For operators, menuing a limited time offer (LTO) can be a fun and exciting process—but that’s not to say it’s necessarily easy. An LTO’s success hinges on a several factors, including how buzzworthy it is, the ingredients it contains, whether there’s brand recognition tied to it, how much it costs and how long it’s available, to name a few.

For operators looking to menu the next McRib, check out these tips.

Make it buzzworthy

The number one factor that will determine whether an LTO will be successful is how much buzz and hype it will generate. Hype can be drummed up by considering what’s currently being offered at other restaurants—in other words, how exclusive is this LTO? If there aren’t similar offerings elsewhere, there’s a big opportunity for operators to capitalize on a menu item’s “new-ness” and innovation.

For example, think of the cronut (the croissant-donut hybrid introduced by Dominique Ansel Bakery in New York City)—when first introduced, no other bakery offered a similar treat, thus spurring lines down the street to try it.

Maximize an LTO’s social-media buzz as well. Facebook and Instagram are Gen Zers' and millennials' two most preferred social media sites, according to Technomic's 2016 Generational report, and millennials are the most likely of all generations to post pictures of food on social media sites. Limited time offers that offer visual appeal have great potential at going viral on social media.

Create urgency by limiting availability

Another aspect to an LTO’s potential for success is its scarcity—how easy it is to purchase and how long it will be available are two contributing factors to an LTO’s buzz. Take Starbucks’ Unicorn Frappuccino, for example—offered for only five days, this unique, brightly colored drink spawned a whirlwind of business and social media promotion for the popular coffee chain.

While it’s not inherently necessary to limit an LTO’s availability to a mere few days, an item’s availability should be clearly spelled out on promotional materials to entice trial. A period ranging anywhere from two weeks to an entire season (perfect for holiday flavors in desserts, for instance) can work to operators’ advantage, and phrases like “while supplies last” or “act now!” can drive traffic.

Drive desirability by elevating concepts

According to Technomic’s 2017 Value & Pricing report, 48% of consumers ages 18-34 say they are seeking out higher-quality menu items than they were two years ago. Higher quality ingredients, house-made, or organic ingredients, can help boost an LTO’s success.

Trending flavors should also be used to help ensure success. According to Technomic’s 2017 Flavor report, 33% of consumers say their flavor preferences tend to change depending on season. This can be used to incorporate tasty treats that are seasonal: coconut, watermelon and other tropical fruits in summertime, for instance, and chocolate, mocha, mint and pumpkin during autumn and winter.

Of course, beyond a menu item’s Instagrammability and limited availability, the next factor that figures into an LTO’s success is its desirability. And one of the things that contributes to a dish’s appeal is brand-name ingredients. In fact, Technomic’s 2017 Value and Pricing report found that 61% of consumers would be more likely to purchase menu items with brand-name ingredients vs. unbranded ingredients. Be sure to spotlight any branded ingredients on menus and in marketing materials.

Price the item properly

So an LTO has made it through menu development and marketing: Now it’s time to price it. Price LTOs based on current market trends for comparable items, as well as comparable items on the same menu. Operators can also consider offering the LTO at a slightly lower cost than similar items to further boost interest.

Technomic’s 2017 Value & Pricing report finds that nearly half (48%) of consumers say they enjoy the restaurant experience more if they are getting a good value, so offering a slightly lower price for a premium LTO can pique interest and ensure customer satisfaction.

As far as what makes an LTO successful it’s not one things but the harmony of several. Unique, buzzworthy menu items that aren’t available elsewhere, limited availability to create urgency, high quality ingredients (including branded ingredients), seasonal or trending flavors and an approachable pricing structure, when combined, provide a win.

This post is sponsored by Mars Foodservices


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