8 Proven Approaches to Identify Growth Opportunities in Dubai’s Restaurant Industry

Written by Sharoon Emmanuel

Sustaining growth and profitability is never a guarantee in the dynamic restaurant industry. Owing to the technological advancement and innovations by newcomers, the business models operating on traditional norms are experiencing shortened life cycles of products and services. Due to this constant variability, it is getting hard for restaurant owners in Dubai to identify new business opportunities.

In order for Dubai’s restaurant industry to gain a competitive advantage, a framework should be defined to better understand the company’s business direction and to acquire information regarding strengths, weaknesses, capabilities and current standings.

Once they have a decent understanding of company goals, current capacity and areas of expertise, the next step is to analyze the market while assessing consumer needs and how they are being catered by others alike. In order to hack growth in Dubai’s restaurant hemisphere, important factors such as brand value propositions, supply chains, direct and indirect competitors, existing regulations and the general environment should be taken into consideration. So, let’s get down to how restaurant owners in Dubai can analyze these factors and make the business work to their advantage. 

Here are the 8 Proven Approaches to Help You Identify Growth Opportunities in Dubai’s Restaurant Industry: -

 1. Consumer Segmentation

For restaurant businesses in Dubai to understand their demand, it is important for them to identify consumer segments that share common characteristics. These characteristics can include variables such as age, gender, area, ethnicity, educational level, profession as well as attitude, lifestyle, values and purchasing motivations or behavior. These variables can help estimate the number of potential customers a restaurant business can have.

For example, fast food joints should know many people of a certain age and area consider eating a certain type of food and to what extent. These variables can also help identify how purchase decisions would be led considering price, health cautiousness, taste, convenience and packaging.

2. Purchase Situation Analysis

Purchase situations carry immense value when uncovering expansion opportunities.

In order to carry out this analysis, the following questions should be answered: -

  • When do people make purchases of a product or service?
  • Do they choose to dine-in or buy online?
  • What is the area of making purchases?
  • What payment method is utilized?
  • What kind of Feedback/ Reviews are being received?

By looking into distribution channels, payment methods, enriched customer data, email lists, transaction records and all other circumstances that are centered on customer behavior, restaurants can position & market their products and services accordingly.  

By leveraging 360-degree customer data, restaurants will be able to create unique yet meaningful customer experiences.  Moreover, this view of customers will also help sales representatives understand what their customers want and create seamless strategies in terms of targeted promotions, pricing, additional menu offerings, store optimization, communication and much more.  Also, it will enable business owners to track a customer’s lifetime value for catering concerns via segmentation and on an individual basis.

3. Direct Competition Analysis

In addition to demand and purchase situation analysis, it is important to consider the competition. Deep knowledge of the existing players in the market is important to compete and evaluate opportunities. 

The analysis should be done considering the following concerns: -

  •  What are the products and brands in our industry?
  • Growth of each brand or product and the reason?
  • What is their value proposition?
  • What competitive advantage do we have over our competitors?

For example, KFC is winning over McDonald's in terms of their fried chicken sales, the reason being their effective marketing strategy, taste and an unmatched pricing model.  

Considering the given parameters, rivals can establish a Unique Selling Point, revamp menu and devise a marketing plan to ensure sustainable growth.  

4. Indirect Competition Analysis

Business growth opportunities can also be found by analyzing substitute industries. For example, you find that a business conference is being held at a five-star hotel nearby, restaurant owners should devise a lead magnet plan to make sure customers from that segment are also attracted to their food business. This specific type of analysis will help fast food restaurants to establish competitive advantages against indirect competitors and provide insights into additional opportunities for growth.

5. Analysis of Complimentary Products & Services

Restaurants in Dubai should also monitor the performance of their competitor’s products & services, which are complementary to their own. For instance, McDonald's offers complimentary toys and merchandise with their meals which helps them land more customers. Take “Happy Meal” for example. Also, they offer a free delivery service, another added advantage.

6. Analysis of Other Industries

In some cases, the objective of restaurants is not to continue operating within a specific domain but to expand to a certain business model or philosophy.  For example, McDonald's adds a new hot coffee lineup in their menu to grab customers that end up at Starbucks after buying a meal from them. When launching a new product, it is always recommended to learn about its competition first: market sizes, growth rates, market shares, unit prices, per capita sales and brand positioning.

7. Foreign Markets Analysis

When a restaurant is operating in a mature or saturated market, exploring other countries may direct to additional growth opportunities. It is an admitted fact that markets in different countries grow at different paces for numerous reasons, including disparities in economic development, behaviors and local habits.

Identifying the evolution of per capita consumption of a given product or service in a given country can serve as a baseline for indication of the maturity of the product’s lifecycle. Moreover, having knowledge of the international market will help estimate a business’s potential and understand how consumption habits develop or are affected.

8. Environment Analysis

Growth opportunities can also be discovered by analyzing changes in the environment with relation to technological developments generating new avenues. Changes in a region’s regulatory framework can also create opportunities for massive growth.

Let’s put it this way, food companies are now required to be transparent in terms of calories, sodium, sugars and saturated fats. The imposition of this causes a massive amount of consumers to switch to healthier eating options. 

Also, environmental changes can affect purchasing behaviors in many ways. In winters, bakery & hot chocolate market flourishes, whereas, in summers refreshing drinks tend to win the game.

Using a variety of analysis will help your restaurant business gain more opportunities and help develop long-term strategic plans. Once opportunities are recognized, companies must move quickly to create and execute a plan.

If you find it hard to analyze data for carving out an effective 360 integrated marketing strategy, call us today at +971 (0)4 338 8823 to book a free appointment. Our team of analysts focus on demand and competitive analysis to provide you strategic insights while crafting your custom-made marketing strategy. 


Originally Published February 28, 2019 12:00 AM, Updated February 28, 2019.

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