March Madness is upon us. Which means fans from all across the country are looking forward to following every upset, buzzer beater, and cinderella story. And nowhere is this more true than the home towns of the teams participating in this year’s tournament.
But does a more passionate and engaged fanbase result in big business for small, local restaurants in these campus towns?
In a previous blog post, we looked at how March Madness affects small, local restaurants across the country. Our analysis showed that restaurants across the country did significantly more business on average during tournament game days. Much of that was attributed to most game days taking place during the weekend, when restaurants do the most business. When compared to the average Thursday through Sunday, tournament game days still preformed better, but by a much slimmer margin.
So what about college towns? Do restaurants near big campuses see bigger bumps than the national average during March Madness? Do cities with teams in the tournament outperform college towns whose teams missed the tournament? Are local fans more or less likely to go out when their team is playing?
In order to answer these questions and more we analyzed transaction data from 42,000 small, local businesses across the country in 2018, using revenue performance during the 2018 NCAA Men’s Basketball Tournament.
Restaurants in college towns outperform the national average during March Madness
We started by looking at restaurant performance in college cities whose teams did and did not compete in the 2018 NCAA tournament. As we pointed out in our previous March Madness post, restaurants do most of their business on weekends. As a result, we determined the impact of March Madness on local restaurants by comparing revenue on tournament days to similar days of the week.
We first looked at performance throughout all days of the tournament. This showed us that restaurants in college towns, regardless of whether their teams were in the tournament, experienced a larger revenue bump than the national average.
Of course, not all days of the tournament are created equal. To get a better comparison we next looked at how restaurants performed as the tournament progressed.
Breaking the tournament down by each round shows us that overall college towns mirror national trends. The 2nd round saw the biggest bumps for all college towns and the national average. Restaurants near colleges playing in the tournament did maintain consistently higher increases in the later stages of the tournament, however. Particularly in the final rounds.
For an even more detailed analysis, here’s a day-by-day breakdown:
These results made us wonder—does a team’s performance in the tournament impact restaurant revenue? Or do college towns with teams in the tournament continue to over-perform regardless of whether their team has been knocked out or not?
Does a deeper run in the tournament equal more business for restaurants in college towns?
To answer this question we started by breaking our pool of tournament cities into two groups: Sweet 16 teams and teams eliminated in the opening weekend.
In the chart above you can see teams that progressed past the first weekend of the tournament saw larger increases in the tournament’s later rounds. This was particularly true during the Elite 8, where revenue for cities with teams out of the tournament fell to levels near the national average.
We next examined performance of cities with teams playing in each round and those whose teams had been eliminated before that round.
Both charts show us that restaurants benefit from their local teams advancing to the tournament’s later rounds (until the Championship game). Interestingly, even though local restaurants in teams knocked out of the tournament still experienced substantial revenue boosts in the later rounds. Which goes to show you shouldn’t necessarily expect traffic to your restaurant to flatline if your local team drops out of the tournament.
How to get the most out of March Madness if you own a restaurant in a college town
It’s clear that the excitement during March Madness drives above-average business across the country. And that increased excitement in tournament towns typically translates into a bigger impact on local restaurants. If you own or manage a restaurant near a college or university, you should go out of your way to take advantage of that increased excitement—whether your local team is in the big dance or not.
If you already experience big business during March Madness, think about how to use the increased attention to pay off after the tournament. Take advantage of the increase in foot traffic to boost your online reputation, for example. Read our article on how to get more reviews for your restaurant for tips and ideas.
Does your restaurant struggle to see the same kind of extra traffic during March Madness we explored in this article? Think about ways to tap into the extra business out there. If you have TVs in your restaurant, share social posts encouraging fans to come watch the games at your restaurant. If you don’t have anywhere to watch the games, maybe consider running special promos on takeout or delivery options. Try following our 4 key elements to building an effective marketing strategy for your restaurant as a good starting point.
Finally, consider using loyalty marketing software to help you build customer loyalty — automatically. With automatic emails and offers, you can get more repeat business with just a few clicks. That way you can get the most out of March Madness long after the champs cut down the nets.
Sign up for a free demo below to see how Womply has helped restaurants like yours increase revenue by 20%, see 22% more repeat customers, and save 10 hours of time per week.