The Restaurant That Gave Away Free Bread.

A second parable about Wi-Fi monetisation.

This article is part of a series. If you haven’t already done so, go and read “The Advertising Funded Bakery“.

Now let’s get started with the second part.

Imagine that you own a restaurant. You sell a specific kind of cuisine and your restaurant is well known for having good customer-service and the food receives good reviews too.

One day, while looking for ways to further improve your customer-service, you notice that other restaurants have started placing a plate with a variety of breads on each table, before any food is ordered. This seems like a nice amenity that you could provide to your own customers, and so you decide to give do the same.

The bread plate is a pretty simple thing; it contains a few different types of breads, and a condiment like a pat of butter, or some olive oil. 

After a month of providing free bread to your customers you notice some interesting trends. Some of the customers eat the bread without any hesitation, while other customers ignore it. Because you’ve spent some effort on making sure the bread tastes great, your customers have started to view the free bread as one of the many attractive reasons to visit your restaurant. You also notice that, maybe because you’ve satisfied a few hangry customers, and because the bread has been largely well received, your customer reviews have improved, driving more business to your restaurant and increasing the frequency at which people return to your business.

The small cost of providing the free bread is outweighed by the benefits provided to your business. You still make enough margin on your other meals to keep providing free bread, even if some tables only order a salad and a glass of water.

For a real life example of this story, you can read all about Olive Garden’s limitless supply of breadsticks

In the next article in this series, I’ll try to compare the business model of the bakery, with the restaurant.

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.