Ch. 7 Business Marketing

Even though businesses produce consumer products they are consumers, too. These products that are purchased are called overhead, they are necessary in keeping the business operating. Businesses that consume products do it out of need unlike and not want. For Hard Rock Cafes the products needed to keep their business running come from several suppliers. Like general consumers, HRC also shop around and compare prices. One of the largest suppliers to domestic HRC’s is Sysco. Sysco produces goods for food service based companies such as meat, cleaning supplies, napkins, aluminum foil, straws and plastic cutlery. By offering a wide variety of products and services to restaurants Sysco can offer a restaurant discounts based on the quantity and frequency of orders.

Hard Rock also consumes services to improve its business like training for its staff. Safety and alcohol training comes from an outside company paid for by HRC. Many times these trainings are required by law but even when they are not HRC chooses to invest this knowledge to its entire staff. Another service HRC purchases in public relations. Hard Rock public relations agencies vary by region and product line but each category has one. The PR company for the Northeast region cafes is different from the PR company for the Las Vegas hotel and Casino.

Supplies for restaurants are expensive. Hard Rock is eager to save money by using less. One way HRC cuts back on waste are by requiring its staff to ask if patrons need napkins and plastic silverware when they pick up to go orders and using smaller inexpensive bags. This is also marketed as better for the environment but is usually out of need to cut cost.

Uniforms are another way HRC loses bug bucks. The purchase of uniforms for the company is a contracted service HRC invest in. New full time employees are given too uniforms for free. Some employees are will stay with the company for many years providing great customer service; others may leave shortly after they’ve been hired. No employees are required to return their uniforms. After seeing high turnover in the restaurant industry some other chain restaurants require uniforms to be returned when the employee leaves or the cost will be taken out of their last check. There are many components of operating a restaurant. They are expensive but necessary. HRC is an example of a company that is doing it right and making money doing it.

Ch. 8 Segmenting and Targeting Markets

Hard Rock International (HRI)  produces different products for different population segments and as the HRI product line grows so does the variety of segmenting markets. For a long time cafes were the cash cows for the brand because they housed the rock shops and merchandise that was sold for large profit margins. The target market for cafes are vacationing young to middle aged married people with and without dependent children.

Souvenirs such as pins and glassware have been marketed to repeat buyers with a collecting habit. Collectors are frequent buyers and they are willing to pay higher than market value for products. Their personality for collection is a sought after trait for marketers. Pin and glassware enthusiast often obtain valuable merchandise particularly city branded items though trading and selling. For example a collector from California may desire a city branded hurricane glass from Fiji but doesn’t want to travel there to get it so the collector will buy t from another collector via the internet.

 Collectors are emotionally attached to the product and brand. They are heavy users or consumers because of the high volume and frequency of their purchases. HRI tries to create heavy users by offering loyalty programs. Pin enthusiasts have their own rewards program (The Pin Club), separate from HRI other frequent buyer program (The All Access Program).  With the Pin Club Card, customers get 10% off every purchase and can preview and purchase specialty pins before they arrive in stores.   

Hard Rock LIVE! is another new product from HRI. Hard Rock LIVE are music venues which have arena style concerts. This product’s target market changes depending on the artist or group playing at the venue. A very established artist like B.B. King will attract an older crowd and an underground rock band would attract young unmarried people without dependents. This particular group has a large disposable income. They are highly involved in music, they frequent music blogs and use social media to follow their favorite bands.

HRI has built new properties where gaming is allowed and many of the new properties also have casinos. Building a resort that include services such as infinity pools, tennis courts, spas, and music venues is a strategy to appeal to a higher end consumer. By having Vegas style shows and gaming, HRI is showing the world that they have the same level of quality as other high end gaming resorts.

Hard Rock wants to move out of the restaurant category and into the gaming and resorts industry. Hard Rock International (HRI) is developing its global image as a luxury brand aimed at tourist seeking a nontraditional yet luxurious experience.

Ch. 11 Developing and Managing Products

Hard Rock International has a 40 year history with many new products and product lines. Early in its existence tee shirts and pins and glassware were the big sellers at every Hard Rock. In the past 10 years, Hard Rock has expanded its company from restaurants to hotels and casinos. The brainstorming for these ideas came from corporate marketer but the success came from loyal consumers.

The launch of Hard Rock brand hotels and casinos were risky investments but if successful would be lucrative. There was definitely brainstorming about the location of the first hotels because location is everything. The first locations were Biloxi, Chicago, Vegas, San Diego, Tampa, Orlando and Hollywood, Florida. All these had casinos by other companies surrounding them except San Diego and Chicago (San Diego and Chicago have no casinos). Building hotels in these places where there is already a demand is logical. There would be little test market analysis because Hard Rock would be fulfilling a need for casual accommodations near higher end hotels. Even if there were already hotels in in these areas adding competition can result in high profits.

Developing casinos would take expertise found outside the Hard Rock company. In 2006 Hard Rock had two established casinos in high traffic gaming cities; Vegas and Biloxi. After seeing high profits at both properties, naturally the company would want to develop new properties. A large amount of capital and the right locations would be needed to have success in the new market. In 2006, The Seminole Tribe from Florida purchased Hard Rock International for 965 million dollars. The Seminole Tribe had many years of experience with casinos and provided both the capital and the know how to develop Hard Rock’s casino business internationally.

After 40 years Hard Rock has is taking larger risk by developing new product lines to add profit to their bottom line. Since 2007 Hard Rock international has added seven hotel and casino properties with seven more coming soon.

Breakfast with Santa

Click here to see what Hard Rock Cafe does for the holidays!
Breakfast with Santa

Ch. 16 Integrated Marketing Communications

To bring attention and interest to its products, Hard Rock Café advertises to its target market: tourist. This can be tourist traveling internationally or domestic. These tourists may know the concept of HRC but need another reason to buy into the brand. In order for HRC to gain tourist dollars they have to build an interest in the brand. HRC knows it target market will do research before they make decisions on where they will dine out, what hotels they will stay at and what activities they will do while on vacation.

Knowing that research will be done is a helpful tool. With information on what popular web sites are used to gather information before making a purchase, HRC can directly advertise on those web sites. For example, to bring attention to a new product line like hotels and casinos, HRC will advertise on travel planning web sites such as expedia and hotwire.com. An average traveler will start their travel planning from several months to a year in advance to “shop around” and find the best prices. Over those months travelers will see many Hard Rock ads and learn more of what perks Hard Rock has to offer.

After tourists are interested in staying at a Hard Rock hotel and resort, Hard Rock must create a target market desire and action. By using glamorous photos, descriptions of the resort and special incentives Hard Rock will create a desire with the consumer making a stay at a Hard Rock property their #1 choice. By continuously pairing the hotel with the casino Hard Rock is creating a desire for something the consumer did not plan of buying.

Eventually, Hard Rock wants the consumer to make a purchase. Depending of the time of year, location and length of stay vacation packages can be several thousand dollars per person. Since it’s a large purchase, consumers may wait for prices to come down, wait for an all-inclusive package that will save them money of air fare or adjust their vacation dates to off peak times. At some point Hard Rock will advertise discounted rates for their vacation spots in order to increase purchases.

Chapter 10 Product Concepts

Each Hard Rock Café has its own retail store called The Rock Shop. The Rock Shops are specialty stores with rock ‘n’ roll themed souvenirs including accessories, apparel, pins and glassware. The product lines with the most depth are apparel and pins. There are many items in each product line. Hard Rock adds to the depth of their product lines to keep the buyer interested in its products and to penetrate new buyers. Some of the most popular items are seasonal pins.

Seasonal pins are made in limited quantities and sold for a limited time. They are made for an event or holiday such as earth day or Thanksgiving. Adding seasonal pins is a way Hard Rock attracts buyers with different preferences. Along with pins, apparel has wide variety of options.

The classic white tee shirt with the Hard Rock brand on the front has always been a big seller. By adding the cafe location to the shirt, adds a feature and a new selling point. Instead of a giving a loved one a souvenir from their vacation, the souvenir becomes an exclusive gift they can’t get anywhere else.

 After guests leave the Rock Shop with their branded souvenirs, they become walking advertisements for the Hard Rock Cafe. They are willing to pay specialty store prices at the Rock Shop because there are only a few Rock Shop locations in the area. The consumer enjoys being a part of a company with high brand equity. They are loyal to the brand because of its quality and global brand awareness.

Ch. 18 Sales Promotion

Companies spend six times more gaining customers than keeping them. One way a business can attract a new customer is with coupons. The goal of the coupon is to introduce the customer to a product and have them repurchase. 85% of coupons can be found in newspapers and magazines; these coupons are called freestanding inserts (FSI).

Hard Rock Café is a part of the 15% of coupon distributors that does not use FSI to gain new customers. HRC sets up its coupons for guests that have already made a purchase. When a guest spends $20 or more at any café, their receipt has a survey code. After they go on line and complete the survey, the guest can print a $5 dollar coupon. This is a great way to gain customer loyalty because the guest knows after their first purchase they will continue to receive $5 off their next purchase.

In addition to coupons HRC has a frequent buyer program; the All Access Card. For $25 a guest can purchase this card and use it at any HRC worldwide. The benefits include a $20 rebate (which can only be used at the café), priority seating and $5 off every time you spend $100. All purchases are added up on the card. Each dollar spent is a point, points never expire and the discount is kept on the card. The All Access Card can be purchased at any café and at hardrock.com.

The goal for any retailer is to get a consumer to repurchase their product. The downside of both of these promotions are guest will never know that they can get a $5 coupon if they never go to a Hard Rock. Since HRC does not use FSI they are not penetrating new markets. While the All Access Card is $25, most frequent buyer programs are free to sign up for and offer similar dollars for points strategy. This may turn people off from buying it and may limit repeat purchases.

Chapter 17 Advertising and Public Relations

In the U.S. 10 million dollars are spent on advertising by major companies each day. For large companies, their advertisements keep the consumer aware of the brand name and remind them to purchase products. Companies use many media types for advertising: newspapers, television, radio, magazine and internet. Each type has a different cost per contact and each reach a different amount of people. 

Television has been the most expensive and most effective way companies reach potential consumers. The internet is becoming a very popular way consumers get news and watch TV programs and movies. Internet advertising has 22 billion dollars in revenue each year to keep up with the consumers.  Phones now have internet access, laptops are more portable and new devices like the iPad have made it easier for the on the go consumer to stay informed.

 The Hard Rock Café uses its own internet site as advertisement. Users who go to hardrock.com can get information on any café worldwide including menu items, special events and hours of operation. HRC advertises special deals and for consumers that can only be found online. This is a profit strategy that a company uses because if a consumer buys a product online, the company pays less overhead and earns more than if that consumer purchased from a retail store. 

You can find other less mainstream types of ads in each city that has a HRC. HRC have become a 3D tangible figure. They have built themselves into the landscape of each city they are in. Since HRC are only built in high traffic areas, usually near arenas and hotels, many people will pass the giant trademark guitar in front of most HRC. A consumer may not realize they are being advertised to each time they pass the HRC on their way to work but if that person goes to that HRC for drinks before a baseball game, that 3D advertisement worked. 

Hard Rock Cafe at New York's Yankee Sadium

Ch. 15 Retailing

    Restaurants are not the first thing most think about when talking about a retailers but restaurants provide a service with tangible products just like a boutique or drug store. The products restaurants provide are prepared foods. They also provides an intangible service that includes having your order taken and clean up provided by the restaurant both provide an enhanced experience.

A study from the National Restaurant Association shows the average American will spend 48% of their food budget on eating out. Americans can afford this lifestyle because of larger household incomes. Most American families have incomes from both parents. For these types of families there is less time to cook at home making eating out convenient and affordable.


Consumers have a wide variety of take-out choices on any given night so how do they decide? Some families choose food that delivers such as pizza and chinese food, both are very affordable. Families on the go may choose drive through restaurants that offer value menus that start at $1 per item. Another popular option is the casual dining restaurant which includes Applebee's T.G.I.Fridays, Dallas BBQ's and other dine-in restaurants. All these have similar price points, an All American cuisine, and are located in shopping centers near populated residential areas.


Hard Rock Cafes are do not profit from the local family consumer. Meals eaten at HRC's are not the typical 5.8 prepared meals the average American eats weekly. Prices and location leave HRC's to tourist and weekend family outings. HRC's are built near hotels and arenas usually in a city's downtown area. Prices are higher than popular chain restaurants but HRC's offer the same type of food.


Guest that dine at HRC are staying at a near by hotel or are attending a sporting event or concert. The way HRC make up for the lack of local business is to sell souvenirs at their Rock Shop and a higher price point on food. HRC do not offer deals or happy hour specials that would attract locals to frequent the restaurant during the week.  These are some interesting facts from The National Restaurant Association website:

• 1.3 million: Number of positions the restaurant industry will add in the next decade
• 34 jobs are generated from every additional million dollars in restaurant sales
• $1.7 billion: Restaurant-industry sales on a typical day in 2011
• 80 percent of restaurant owners started their industry careers at entry-level positions
• 46 percent of restaurant employees say they would like to own their own restaurant some day
• 88 percent of adults say they enjoy going to restaurants
• 71 percent of adults say they try to eat healthier now at restaurants than they did two years ago
• 47 percent of adults say they would patronize food trucks
• 69 percent of adults say they are more likely to visit a restaurant that offers food grown or raised in an organic or environmentally-friendly way
• http://www.restaurant.org/research/facts/

Ch. 6 Consumer Decision Making

When a consumer makes a purchase, that purchase is motivated by one or several wants or needs. There is a chart of needs based on a theory by Maslow:

One of Maslow's theories of motivation is the peak experience. A peak experience is experiencing love, music, art or the beauty of nature. Examples of theses are when consumers purchase tickets to a museum, opera, or a trip to an African safari. These can range in a rare ocassion for the working class or frequent occasions for upper class consumers.
Peak experiences may be a reward you give to yourself when you've accomplished something difficult like a cruise when you graduate from college or tickets to a play-off game after a promotion.
The Hard Rock Cafe is in the peak experience business. Their goal is to create "authentic experiences that rock" for every guest. As a moderately priced music venue, music memoribilia museum, retail store and restaurant the Hard Rock is able to provide an affordible peak experiences to all social classes. There is no admission fee for patrons to enter a HRC. By providing free live music and a rock 'n' roll museum, patrons are more likely to purchase souvenirs from HRC retail store to remember their peak experience with such as a Hard Rock tee-shirt or  guitar pin.  

Chapter 2: Strategic Planning for Competitive Advantage

To some people Hard Rock Cafe is a rock 'n' roll themed restaurant, but each cafe offers 'one stop shopping' for the rock 'n' roll enthusiast. HRC is an entertainment and retail store that sells food and alcohol. Being able to have dinner listen to a live band, look at price less rock memorabilia and buy a souvenir glass, pin or tee shirt from the ROCK SHOP is a part of an authentic experience HRC provides each guest.

The HRC menu is moderately priced with classic American food. Someone can find the similar food in the same price range one of HRC competitors; Planet Hollywood. HRC provides a something unique by providing a museum of rock history in every cafe and retail merchandise designed by top musicians called Signature Series. They have two loyalty programs, The Pin Club; for their large following of pin collectors and The All Access Card that frequent merchandise and diners can use at every hotel, casino and café.

Chapter 3: Ethics and Social Responsibility

Hard Rock International is one of the most recognized trademarks globally. It has cafes, casinos and hotels in 47 countries worldwide. The integrity of the company has been around since its beginning 40 years ago. Its mission has been “do well by doing good” since 1971. Since then it has been a leader of social responsibility. One of its many philanthropic causes is breast cancer awareness.

            October is national breast cancer awareness month. PINKTOBER is Hard Rock’s breast cancer awareness campaign which has been around for 12 years. 10% of all sales of Pinktober merchandise (pins, apparel and bedding) go to The Breast Cancer Research Foundation and The Caron Keating Foundation. The Pinktober merchandise can be found in all cafes and at the Hard Rock website. Cafes also host parties and live music events to raise money for research.

            The Hard Rock also has a humanitarian, environmental and entertainment industry philanthropic causes they support. Their mottos are TAKE TIME TO BE KIND (Humanitarian), SAVE THE PLANET (Environmental) and ALL IS ONE (Entertainment Industry). Each of the cafes has one of these mottos posted. The Hard Rock is an example of a business that has gone above and beyond by ‘doing good’ in the global and local community since the day it began. They know and understand that corporate philanthropy is a business strategy that is necessary for success.

Chapter 5 Developing a Global Vision

Since its first cafe in London in 1971, The Hard Rock Cafe has opened its doors in 51 countries worldwide and has been an international company since 1982. Some of the first restaurants outside London were Paris, Berlin, Los Angeles, Chicago, Houston and New York. A rock 'n' roll music themed restaurant that served classic American food was easy to digest in developed countries in the Western Hemisphere. But could it do the same in international markets of developing countries?

Hard Rock recognized the success of its first international restaurants and reacted by adding restaurants in developing countries in the Caribbean, Central and South America, India and China. The risks of culture resistance from these countries were low.  Rock 'n' roll music may have started in the U.S. but is listened to all over the world. HRC was less of an outsider and more of an entertainment attraction in most countries.

The brand continues to grow, seeing an increase in of its cafes. According to the year-end report earnings for 2006, revenue for company owned cafes were $501.9 up 10.9% from 2005. With such promising numbers, the highest profits are coming from overseas. Sales in Europe were up 8.8% sales in North America were up 5.8%. The company elvaluated under performing cafes and closed two American cafes in Austin and Los Angeles. HRC opened five international cafes in Ocho Rios, Mumbai, Narita, Santo Domingo and Margarita.

Hard Rock International includes cafes, hotels and casinos. Its hotels and casinos have a a higher profit margin than its cafes. Its American cafes are seeing a decrease in sales and a smaller market share. Is the American cafe the 'dog' of the Hard Rock International brand? 

Chapter 4 The Marketing Environment: Target Market

         
     For forty years, The Hard Rock Brand has been the prototype for theme restaurants. It had little competition until Planet Hollywood which is a movie themed restaurant with authentic movie memorabilia directly from the sets of Hollywood's biggest blockbusters. The competition for tourist dollars is obvious here in New York's own time Square where the Hard Rock Cafe (HRC) and Planet Hollywood sit directly across the street from each other.
      After going to Times Square, just based on curb appeal, The Hard Rock is a sstrong brand name and a target market of Generation X and Yers. From my observations, the majority of people going into Planet Hollywood were families with tween children or younger. Adults without children and large groups of adults opted for the Hard Rock.This could be a strategy from Planet Hollywood to direct their marketing to families with young children since they understand Hard Rock is courting the Gen X and Y market.
       Another observation based on curb appeal, was the design of the restaurants. The HRC has a darker theme, almost Gothic, with dark steel signs and minimal neon lighting. Planet Hollywood has big bright neon letterings that fit in well with the rest of the lights in Times Square. Along with the lighting, one can determine if the restaurant is the right fit by the drink menu. HRC had much larger alcohol menu with interesting signature cocktails including the 'Hurricane' which has its own glass named after it.
    The Hard Rock's understands who their target market is and why they are in Times Square. HRC understands the traveler's disire for a mature crowd thats wants to let loose with some rock and roll and alcohol.