What Is Happy Hour? Plan the Best Happy Hour and Maximize Profits

Happy hours really are the happiest times of the day. They provide an ideal opportunity for customers to relax with their friends and colleagues over discounted drinks and half-price snacks. Happy hours help restaurants attract new customers, increase sales at bars, and give the restaurant bottom lines a nice little boost.

What Is Happy Hour?

Happy hours are special times of day when drinks and snacks are offered for less than usual prices at many bars and clubs. These offers vary from two-for-ones to special pricing on selected food and drinks. It usually occurs during the late afternoon and evening hours because it’s the transition period between work and family life. Happy hour can happen any time of day or night but depends on the type of restaurant.

However, even though this promotion has been the industry’s secret sauce for quite some time, there are certain states where this practice isn't so popular. States such as Alaska, Massachusetts, and Vermont have banned the kinds of alcohol deals typically associated with happy hours. If you're in a state where alcohol sales are banned during happy hours, your promotions can be focused on food and non-alcoholic beverages instead.

When Is Happy Hour?

Happy hours are periods of time between about 2 p.m. and 6 or 7 p.m., during which alcohol consumption is allowed. Happy hours tend to be either an hour long or two to three hours long. During these times, there is usually less demand for alcoholic beverages than during the rest of the day.

What is the best time for happy hour?

Happy hour tends to be at its best from 5 p.m. to 7 p.m., which is when most bars and restaurants tend to be less crowded than they are later in the evening.

Since most people finish their work for the week and start making their evening plans. A happy hour gives people a chance to relax after a long day at work, hang out with their coworkers, and enjoy something creative, fun, or competitive.

Happy hour typically lasts from four to five hours, but it’d be best to keep it shorter than that.

Why Should You Implement Happy Hours for Your Restaurant

Yes, it sounds like a good deal for customers. Who wouldn't want discounts on slider and half-priced well drink?

What’s in it financially for you as a restaurant owner?

Offering discounts at certain hours of the day can help increase sales during slower periods of time. Here, we discuss some of the main advantages of offering this type of promotion at restaurants.

(See more: Bartending Tips)

It Increases Traffic and Sales

One of the main reasons for doing something is because it’ll be good for business.

A 2018 Nielsen study found that U.S. bar and restaurant owners generated 60.5 percent of their average weekly sales during happy hours — even with major discounts at the table. Furthermore, the average happy hour price is $68.99 per person, which is $8 above the average price for drinks at other times of the week.

Besides larger checks, it’ll be a good idea to offer discounts for slow periods of the day. According to Nielsen, Wednesday happy hour traffic is 23.9 percent higher than other days, which makes it the fourth most valuable day part for bar and restaurant owners.

It turns out that this surprising statistic reveals just how effective it can be at increasing traffic during slow times.

Help with Upselling of Orders

One of the reasons that happy hour promotions can be so profitable is because they provide a multitude of opportunities for upselling. Whether it’d be offering a larger size at an additional cost or adding a small charge for a side of guaca­mole, upsells can be incorporated into this promo­tion.

Opportunity to Get New Customers

Happy hours can definitely help increase sales. However, it can also be an effective recipe for long-term business growth.

Instead of considering happy hour as a one time event, think of it as an opportunity to show off your restaurant. These customers get a chance to experience what your restaurant has to offers. If you do it well, you’ll be able to leave customers craving more.

To ensure your new guests become loyal patrons, you need to provide them with a carefully curated selection of your regular food and beverage offerings. If people see your restaurant serving mini drinks or small sliders, they're likely to order the full portions next time.

Great for Marketing!

Happy hours aren't usually secretive affairs. On the contrary, people see this as an opportunity to get together socially and this obviously is a great marketing strategy as it adds some buzz for your business.

You can promote your happy hour drink and special deals through social networking sites, table signs, and word-of-mouth marketing. According to TouchBis­tros' How Diners Choose Restaura­nts, 80 percent of diners will visit a new restau­rant based solely on receiving a discount or promo­tion.

Planning Your Successful Happy Hour

Timing is key!

You can test out different happy hours by testing them at various times. People find variety and novelty intrinsically interesting, and this is just as true in bars and restaurants as it is anywhere else

You can check out this happy hour concept that is based on the time :

• Offer huge discounts for appetizers between 3 PM and 5 PM: For a couple of hours, you can offer a huge discount on simple menu items like appetizers to attract people to stay longer. Since appetizers are usually cheaper, you to be cheap the discount doesn’t eliminate all appetizer revenue. At this time, most people have already finished lunch and aren't planning their next meal for a couple hours, hence, 3 pm-5 pm is the best window for this.
• Popular drinks are discounted during low-traffic times.
• During the slow hours from 5 PM to 7 PM, get 15 percent off all orders at any restaurant. Instead of allowing those hours to go unused, offer a discount that can only be redeemed during that time.

Tips for a Successful Happy Hour

Make sure to know your Customers

Before you slash cocktail pricing or offer $1 beer, it’s essential to consider who your current guests are. You can use POS reporting and analytics to determine which products sell best during certain hours of the day. Then you can create a happy hour special for popular, high-profit items.

For example, if your sales by menu item report reveals that most of your clients are business people who order wine over beer and cocktail drinks, then you know that your target market is likely business people. You can use this information to tailor your promotions to this particular audience by giving them discounted wine at night.

Use Happy Hours to experiment

Traditionally, these events occur at the end of the day when people are tired and hungry but not yet ready for their evening meal.

For example, late night happy hours have become a common strategy for many bar and restaurant owners to attract young people. According to the National Restaurant Association, "more than half of consumers between the ages of 18 and 34 make late-evening restaurant visits at least once per week."

Furthermore, 41 percent of those aged 21 to 35 say that special offers like these play a key part in whether they visit a nightlife establishment. For example, if you offer half-price drinks at 10 p.m., you might attract some younger people who would otherwise not be there.

You should definitely check your local and state law before running this kind of promotion. Don't risk losing your liquor license!

Entice Your Customers with Amazing Food Specials

Happy hour is traditionally thought of as a time for drinking special drinks, but 41 percent of people who attend happy hours are actually there because they're eating. You need to go beyond a curate drink list to ensure you draw a crowd.

Some of the different ways to include food are:

• Offering Small Plates: A way to introduce your menu to new patrons is by offering small-plate variations of your most popular lunch and dinner entrees.
• Offer Shareable Snacks: If you're catering to larger groups, add shareable dishes to your menus during this time.

When testing out different happy hour menus, be sure to watch for the size of the checks. Paying attention to these metrics will help you understand the overall success of each dish, how popular they are, and their effect on your bottom line.

Make Sure to Offer Non-Alcoholic Options

If your campaign only targets alcohol drinkers, you may be overlooking an important segment of the population.

According to a study by NPD Group, 40 percent of global consumers are interested in reducing their alcoholic drink intake for health purposes. And, the market for low to no-calorie beverages is expected to increase by 32 percent from 2018 to 2022. It’s a growing phenomenon that’s largely fueled by healthy consumers who want to drink fewer calories without sacrificing their social lives.

You can offer mocktails alongside your regular drinks to appeal to nondrinkers and the sober curious. You can even design an entire zero-proof happy hour meal — an idea that works well for restaurants located in states where alcohol cannot be served during certain hours.

Make Sure Your Staff is Well-Prepared

Your employees play an important role when it comes to planning a successful cocktail hour event. They should not only know the specials inside and outside, but they should also understand the purpose of your happy hours.

Do you want to attract new customers during off hours or increase restaurant sales among your regular customers?

Each restaurant is unique and it s important that your staff knows what your goals are so they can help you achieve them.

You can also use your front-of-house staff to promote your happy hours by letting them know about the happy hour deal. Encourage your servers to let customers know about upcoming promotions.

(See More: How Old do You have to be to serve alcohol?)

Include Some Entertainment

Happy hours are becoming increasingly popular at restaurants across the country, but they're often difficult to differentiate from one another. Instead of offering rock bottom pricing, using entertaining activities like trivia or live bands can help set your business apart from others.

Entertainment can be expensive but it can help fill tables and increase check amounts. A study concluded that live music makes them more likely to eat and consume alcohol and to bring their friends to enjoy themselves.

You could also consider unconventional entertainment options if live concerts aren't available. For example, January and early February tend to be slower than normal restaurant months, but they are peak dating seasons for customers. During these cold winter months, you could hold social events such as singles-only happy hours and let customers get to know each other over discounted drinks.

Profits are Maximized

If you don't make any money from your happy hours, even though you may have great deals, fun entertainment, and a large audience, it won't be worth it. Instead of simply looking at the total number of customers who come into the store, you should be focusing on how much they're spending.

To ensure that happy hour doesn't drain your bank account, use these profit-maximizing tips:

• Upsell
• Cross-Sell
• Add Menu Modifiers
• Mix in Premium Items
• Use Overstock Materials
• Carefully Structure Your Menu

Ready to be a Successful a Bartender?

Here at Culinary Depot, we provide bartending supplies and cocktail-making tools for professional and home bartenders. Get in touch, and we'll help you get all the restaurant equipment you need to run your business!