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IRINA	
  AVRUTSKAYA	
  
BATTLE	
  FOR	
  THE	
  GUEST	
  
	
  
INTRODUCTION	
  
	
  
The	
  world	
  has	
  changed	
  and	
  in	
  some	
  cases	
  it’s	
  changed	
  significantly!	
  During	
  the	
  ten	
  years	
  that	
  I’ve	
  
been	
  working	
  in	
  marketing	
  in	
  the	
  restaurant	
  industry	
  it	
  has	
  not	
  just	
  made	
  a	
  step	
  forward,	
  it	
  has	
  leaped	
  
forward	
   and	
   even	
   jumped	
   upward.	
   Advertising	
   as	
   such	
   has	
   already	
   stopped	
   being	
   an	
   engine	
   of	
   new	
  
business	
  and	
  the	
  main	
  marketing	
  expert	
  for	
  your	
  goods	
  and	
  services	
  has	
  in	
  fact	
  become	
  the	
  customer	
  
itself.	
   The	
   notion	
   “target	
   audience”	
   fell	
   into	
   oblivion	
   and	
   the	
   “unique	
   selling	
   point”	
   will	
   not	
   work	
  
anymore	
  unless	
  it	
  becomes	
  a	
  “brand	
  promise”.	
  At	
  the	
  same	
  time	
  brands	
  do	
  not	
  compete	
  for	
  “market	
  
share”	
  so	
  much	
  as	
  they	
  fight	
  for	
  a	
  “life-­‐time	
  loyalty	
  of	
  (a	
  certain	
  number	
  of)	
  clients”.	
  
Sounds	
   drastic?	
   Perhaps,	
   but	
   do	
   have	
   a	
   look	
   around.	
   In	
   your	
   store	
   today	
   most	
   guests	
   use	
  
smartphones	
  not	
  push-­‐button	
  phones	
  and	
  an	
  apple	
  logo	
  can	
  be	
  seen	
  on	
  tablets	
  and	
  laptops	
  of	
  more	
  and	
  
more	
  customers.	
  	
  
Is	
  your	
  coupon	
  distribution	
  not	
  giving	
  you	
  returns	
  anymore?	
  That	
  means	
  it’s	
  time	
  to	
  change	
  your	
  
traditional	
  marketing	
  approach!	
  	
  
Modern	
  marketing	
  is	
  not	
  about	
  increasing	
  sales	
  by	
  growing	
  the	
  number	
  of	
  transactions	
  or	
  (even	
  
worse)	
  raising	
  the	
  average	
  ticket,	
  it's	
  a	
  methodology	
  of	
  establishing	
  long-­‐term	
  relationships	
  with	
  your	
  
guests.	
  However,	
  is	
  this	
  approach	
  really	
  as	
  “modern”	
  as	
  it	
  seems?	
  As	
  early	
  as	
  in	
  1967	
  marketing	
  guru,	
  
Philip	
  Kotler,	
  described	
  in	
  his	
  classic	
  work	
  Marketing	
  Management	
  a	
  “new	
  marketing	
  concept”	
  whereby	
  
the	
  focus	
  shifts	
  from	
  products	
  manufactured	
  by	
  a	
  company	
  being	
  actively	
  promoted	
  and	
  sold	
  to	
  creating	
  	
  
products	
   which	
   meet	
   people’s	
   needs	
   which	
   in	
   turn	
   generates	
   profits	
   through	
   satisfying	
   specific	
  
customer	
  demands.	
  	
  	
  
In	
   the	
   early	
   20th	
   century,	
   when	
   the	
   market	
   wasn’t	
   saturated	
   with	
   goods	
   and	
   customers	
   didn’t	
  
show	
  special	
  requirements	
  or	
  preferences,	
  the	
  concept	
  of	
  mass	
  production	
  was	
  a	
  driving	
  force	
  for	
  any	
  
successful	
   business.	
   In	
   the	
   hunt	
   for	
   ever	
   higher	
   sales	
   volumes	
   marketing	
   was	
   a	
   kind	
   of	
   amplifier	
   or	
  
super-­‐sized	
  loud	
  speaker:	
  the	
  one	
  who	
  screamed	
  louder	
  sold	
  more.	
  	
  
During	
  the	
  next	
  stage	
  of	
  consumer	
  market	
  development,	
  after	
  basic	
  demand	
  had	
  been	
  satisfied,	
  
process	
  optimization	
  and	
  finances	
  started	
  to	
  take	
  the	
  lead	
  role:	
  a	
  business	
  had	
  to	
  work	
  on	
  production	
  
and	
  sales	
  efficiency	
  in	
  order	
  to	
  increase	
  revenue,	
  profit	
  margins.	
  	
  
The	
  third	
  stage	
  described	
  by	
  Kotler	
  in	
  the	
  first	
  editions	
  of	
  his	
  famous	
  work	
  was	
  market	
  deficit,	
  an	
  
environment	
  characterized	
  by	
  a	
  saturation	
  with	
  a	
  large	
  number	
  of	
  products	
  and	
  high	
  competition.	
  The	
  
way	
  forward	
  was	
  seen	
  by	
  entrepreneurs	
  of	
  those	
  times	
  in	
  capturing	
  emerging	
  markets	
  or	
  increasing	
  
investment	
   in	
   advertising.	
   Kotler	
   advocated	
   a	
   change	
   of	
   marketing	
   focus	
   from	
   sales	
   support	
   of	
  
manufactured	
  products	
  to	
  studying	
  and	
  meeting	
  the	
  demand	
  for	
  not	
  yet	
  existing	
  products,	
  services	
  or	
  
solutions.	
  	
  
In	
   Russia	
   the	
   development	
   of	
   a	
   market-­‐driven	
   economy	
   only	
   started	
   in	
   the	
   90’s	
   and	
   therefore	
  
most	
  companies	
  today	
  still	
  belong	
  to	
  the	
  first	
  and	
  second	
  stage,	
  only	
  a	
  few	
  have	
  reached	
  the	
  third.	
  But	
  
since	
  publishing	
  the	
  book	
  it's	
  been	
  over	
  50	
  years	
  and	
  the	
  world	
  has	
  irreversibly	
  changed.	
  This	
  is	
  in	
  large	
  
part	
  due	
  to	
  new	
  information	
  and	
  communication	
  technologies,	
  having	
  transformed	
  our	
  every-­‐day	
  lives	
  
and	
  reaching	
  every	
  field	
  of	
  human	
  activity	
  so	
  dramatically	
  in	
  the	
  last	
  fifty	
  years	
  that	
  no	
  other	
  previous	
  
invention(s)	
  can	
  compare	
  to	
  their	
  influence	
  on	
  humanity.	
  	
  
As	
  a	
  result,	
  the	
  marketing	
  realm	
  in	
  the	
  21st	
  century	
  represents	
  yet	
  another,	
  the	
  fourth	
  stage	
  of	
  
market	
  development.	
  Today	
  a	
  consumer	
  can	
  not	
  only	
  choose	
  from	
  thousands	
  of	
  products/services	
  or	
  
hundreds	
  of	
  restaurants	
  available,	
  by	
  just	
  one	
  click	
  on	
  the	
  screen	
  or	
  voice	
  command,	
  but	
  he	
  or	
  she	
  can	
  
and	
   should	
   directly	
   affect	
   the	
   creation	
   of	
   products	
   or	
   services	
   through	
   his	
   or	
   her	
   activity	
   in	
   social	
  
networks.	
  Moreover,	
  the	
  purchase	
  process	
  goes	
  from	
  satisfaction	
  of	
  “rational”	
  needs	
  of	
  the	
  customers	
  to	
  
an	
  “emotional”	
  activity.	
  Modern	
  buyers	
  regardless	
  of	
  their	
  social	
  status,	
  income	
  or	
  age,	
  don’t	
  just	
  want	
  to	
  
spend	
  money	
  on	
  food	
  and	
  pleasure	
  but	
  receive	
  something	
  more.	
  What	
  “more”	
  you	
  ask?	
  They	
  wish	
  to	
  
know	
  where	
  you	
  get	
  the	
  ingredients	
  for	
  your	
  dishes	
  from,	
  where	
  your	
  chef	
  studied	
  and	
  why	
  your	
  store	
  
uses	
  this	
  or	
  that	
  kind	
  of	
  dishware.	
  They	
  want	
  to	
  give	
  their	
  money	
  not	
  to	
  corporations	
  or	
  entrepreneurs,	
  
but	
  to	
  people,	
  to	
  people	
  just	
  like	
  them.	
  Eventually	
  they	
  are	
  ready	
  to	
  buy	
  from	
  those	
  who	
  invest	
  their	
  
profit	
   in	
   social	
   development.	
   In	
   the	
   age	
   of	
   total	
   time	
   pressure	
   people	
   not	
   only	
   leave	
   their	
   money	
   in	
  
restaurants,	
  but	
  also	
  something	
  more	
  valuable	
  –	
  their	
  time.	
  Therefore,	
  they	
  don’t	
  simply	
  need	
  just	
  any	
  
breakfast,	
  lunch	
  or	
  dinner,	
  but	
  a	
  whole	
  complex	
  of	
  experience,	
  emotions	
  and	
  information.	
  To	
  enjoy	
  tasty	
  
food	
  goes	
  without	
  saying	
  today,	
  it’s	
  expected	
  or	
  a	
  pre-­‐requisite.	
  	
  
At	
  the	
  dawn	
  of	
  the	
  restaurant	
  business	
  developing	
  in	
  Russia	
  it	
  was	
  enough	
  to	
  open	
  a	
  good	
  looking	
  
restaurant	
  with	
  decent	
  cuisine	
  from	
  a	
  foreign	
  chef	
  and	
  success	
  was	
  pretty	
  much	
  guaranteed.	
  Then	
  came	
  
the	
  time	
  when	
  it	
  was	
  necessary	
  to	
  create	
  a	
  brand	
  or	
  reference	
  brand,	
  such	
  as	
  Ginza	
  Project	
  or	
  Novikov	
  
Group	
  of	
  Companies,	
  and	
  the	
  guest	
  would	
  go	
  to	
  that	
  store.	
  Today,	
  however,	
  with	
  the	
  development	
  of	
  
ever	
   changing	
   technology	
   and	
   new	
   media,	
   the	
   main	
   “criteria	
   of	
   choice”	
   is	
   not	
   advertising,	
   not	
   the	
  
brightest	
  sign,	
  nor	
  the	
  celebrity	
  chef	
  but	
  reviews	
  from	
  other	
  people	
  which	
  are	
  able	
  to	
  disturb/subvert/	
  
or	
  even	
  kill	
  your	
  business	
  for	
  a	
  couple	
  of	
  weeks	
  or	
  longer!	
  	
  
Therefore,	
  the	
  role	
  and	
  responsibilities	
  of	
  today’s	
  marketing	
  experts	
  has	
  changed	
  dramatically.	
  In	
  
order	
  to	
  make	
  a	
  restaurant	
  successful	
  one	
  has	
  to	
  work	
  on	
  creating	
  an	
  overall	
  concept,	
  determining	
  touch	
  
points	
   of	
   your	
   brand	
   with	
   your	
   guests,	
   investigating	
   various	
   “influence	
   agents”,	
   as	
   well	
   as	
   planning	
  
thoroughly	
  the	
  strategy	
  and	
  social	
  media	
  communications.	
  	
  
It’s	
   not	
   restaurant	
   critics	
   and	
   chefs	
   who	
   determine	
   the	
   restaurant’s	
   success;	
   it’s	
   any	
   of	
   your	
  
guests,	
  here	
  and	
  now,	
  in	
  real	
  time.	
  While	
  previously	
  restaurants	
  often	
  managed	
  well	
  without	
  systematic	
  
research,	
   today	
   the	
   company’s	
   image	
   is	
   created	
   in	
   the	
   information	
   space	
   (social	
   networks,	
   mobile	
  
applications,	
  internet	
  sites,	
  etc.),	
  and	
  quite	
  often	
  without	
  the	
  company	
  itself	
  being	
  involved	
  in	
  it.	
  Not	
  
knowing	
  how	
  to	
  handle	
  this	
  massive	
  information	
  resource	
  may	
  well	
  destroy	
  your	
  business	
  completely.	
  	
  
Marketing	
   has	
   changed	
   fundamentally	
   and	
   I	
   think	
   you	
   bought	
   this	
   book	
   because	
   you	
   realize	
   it	
  
yourself.	
  	
  	
  
Traditional	
  media	
  is	
  rapidly	
  losing	
  influence	
  and	
  power,	
  newspapers	
  and	
  magazines	
  are	
  closing,	
  
advertising	
   billboards	
   become	
   less	
   popular	
   and	
   our	
   everyday	
   life	
   focuses	
   on	
   the	
   screens	
   of	
   our	
  
computers,	
  tablets	
  and	
  smartphones.	
  	
  
“Push”	
  type	
  of	
  advertising	
  is	
  rapidly	
  losing	
  its	
  efficiency	
  as	
  customers	
  have	
  a	
  sheer	
  endless	
  variety	
  
and	
  choice	
  of	
  goods	
  and	
  services	
  and	
  have	
  the	
  opportunity	
  to	
  evaluate	
  their	
  benefits	
  (and	
  drawbacks)	
  
before	
   buying	
   them	
   simply	
   by	
   making	
   a	
   couple	
   of	
   requests	
   on	
   any	
   search	
   engine.	
   So	
   today	
   “pull”	
  
advertising	
  is	
  the	
  name	
  of	
  the	
  game	
  whereby	
  various	
  	
  advertising	
  technologies	
  allow	
  the	
  client	
  to	
  “pull”	
  
information	
  on	
  your	
  offer	
  while	
  searching	
  for	
  something	
  similar.	
  	
  
At	
  the	
  same	
  time	
  don’t	
  be	
  too	
  quick	
  to	
  dismiss	
  existing	
  marketing	
  theories,	
  traditional	
  working	
  
instruments	
  or	
  principles.	
  Most	
  of	
  those	
  will	
  still	
  be	
  useful	
  in	
  many	
  markets	
  across	
  Russia	
  in	
  the	
  next	
  
several	
  years.	
  
In	
  this	
  book	
  you	
  will	
  find	
  answers	
  to	
  questions	
  on	
  how	
  to	
  properly	
  combine	
  strategic	
  and	
  tactical	
  
marketing	
   activities,	
   which	
   tools	
   are	
   most	
   effective	
   today,	
   how	
   to	
   manage	
   traditional	
   advertising	
  
techniques	
   and	
   modern	
   communication	
   channels,	
   and	
   how	
   to	
   increase	
   profitability	
   with	
   simple	
  
marketing	
  patterns.	
  	
  
While	
  constantly	
  repeating	
  “the	
  world	
  has	
  changed”	
  mantra	
  one	
  shouldn‘t	
  forget	
  that	
  this	
  process	
  
is	
   constantly	
   ongoing,	
   and	
   with	
   the	
   pace	
   of	
   technological	
   development	
   we	
   see	
   today,	
   even	
   the	
   most	
  
“modern”	
   today	
   may	
   become	
   “outdated”	
   sooner	
   than	
   you	
   think.	
   However,	
   I’ll	
   try	
   to	
   offer	
   you	
   a	
  
reasonable	
   forecast	
   of	
   what	
   the	
   nearest	
   future	
   holds	
   for	
   restaurant	
   marketing.	
   	
   And	
   all	
   the	
   latest	
  
examples	
   of	
   innovative	
   marketing	
   technology	
   will	
   be	
   continuously	
   be	
   published	
   on	
   my	
   website	
  
www.avrutskaya.com.	
  Here	
  you	
  can	
  also	
  ask	
  me	
  questions	
  and	
  receive	
  individual	
  consulting.	
  	
  
Battle	
  for	
  the	
  guest	
  is	
  not	
  primarily	
  a	
  fight	
  against	
  competitors;	
  it’s	
  mainly	
  an	
  attempt	
  to	
  excel	
  
oneself.	
  	
  
	
  
The	
  future	
  has	
  come!	
  
	
  

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INTRODUCTION

  • 1. IRINA  AVRUTSKAYA   BATTLE  FOR  THE  GUEST     INTRODUCTION     The  world  has  changed  and  in  some  cases  it’s  changed  significantly!  During  the  ten  years  that  I’ve   been  working  in  marketing  in  the  restaurant  industry  it  has  not  just  made  a  step  forward,  it  has  leaped   forward   and   even   jumped   upward.   Advertising   as   such   has   already   stopped   being   an   engine   of   new   business  and  the  main  marketing  expert  for  your  goods  and  services  has  in  fact  become  the  customer   itself.   The   notion   “target   audience”   fell   into   oblivion   and   the   “unique   selling   point”   will   not   work   anymore  unless  it  becomes  a  “brand  promise”.  At  the  same  time  brands  do  not  compete  for  “market   share”  so  much  as  they  fight  for  a  “life-­‐time  loyalty  of  (a  certain  number  of)  clients”.   Sounds   drastic?   Perhaps,   but   do   have   a   look   around.   In   your   store   today   most   guests   use   smartphones  not  push-­‐button  phones  and  an  apple  logo  can  be  seen  on  tablets  and  laptops  of  more  and   more  customers.     Is  your  coupon  distribution  not  giving  you  returns  anymore?  That  means  it’s  time  to  change  your   traditional  marketing  approach!     Modern  marketing  is  not  about  increasing  sales  by  growing  the  number  of  transactions  or  (even   worse)  raising  the  average  ticket,  it's  a  methodology  of  establishing  long-­‐term  relationships  with  your   guests.  However,  is  this  approach  really  as  “modern”  as  it  seems?  As  early  as  in  1967  marketing  guru,   Philip  Kotler,  described  in  his  classic  work  Marketing  Management  a  “new  marketing  concept”  whereby   the  focus  shifts  from  products  manufactured  by  a  company  being  actively  promoted  and  sold  to  creating     products   which   meet   people’s   needs   which   in   turn   generates   profits   through   satisfying   specific   customer  demands.       In   the   early   20th   century,   when   the   market   wasn’t   saturated   with   goods   and   customers   didn’t   show  special  requirements  or  preferences,  the  concept  of  mass  production  was  a  driving  force  for  any   successful   business.   In   the   hunt   for   ever   higher   sales   volumes   marketing   was   a   kind   of   amplifier   or   super-­‐sized  loud  speaker:  the  one  who  screamed  louder  sold  more.     During  the  next  stage  of  consumer  market  development,  after  basic  demand  had  been  satisfied,   process  optimization  and  finances  started  to  take  the  lead  role:  a  business  had  to  work  on  production   and  sales  efficiency  in  order  to  increase  revenue,  profit  margins.     The  third  stage  described  by  Kotler  in  the  first  editions  of  his  famous  work  was  market  deficit,  an   environment  characterized  by  a  saturation  with  a  large  number  of  products  and  high  competition.  The   way  forward  was  seen  by  entrepreneurs  of  those  times  in  capturing  emerging  markets  or  increasing   investment   in   advertising.   Kotler   advocated   a   change   of   marketing   focus   from   sales   support   of   manufactured  products  to  studying  and  meeting  the  demand  for  not  yet  existing  products,  services  or   solutions.     In   Russia   the   development   of   a   market-­‐driven   economy   only   started   in   the   90’s   and   therefore   most  companies  today  still  belong  to  the  first  and  second  stage,  only  a  few  have  reached  the  third.  But   since  publishing  the  book  it's  been  over  50  years  and  the  world  has  irreversibly  changed.  This  is  in  large   part  due  to  new  information  and  communication  technologies,  having  transformed  our  every-­‐day  lives   and  reaching  every  field  of  human  activity  so  dramatically  in  the  last  fifty  years  that  no  other  previous   invention(s)  can  compare  to  their  influence  on  humanity.     As  a  result,  the  marketing  realm  in  the  21st  century  represents  yet  another,  the  fourth  stage  of   market  development.  Today  a  consumer  can  not  only  choose  from  thousands  of  products/services  or   hundreds  of  restaurants  available,  by  just  one  click  on  the  screen  or  voice  command,  but  he  or  she  can   and   should   directly   affect   the   creation   of   products   or   services   through   his   or   her   activity   in   social   networks.  Moreover,  the  purchase  process  goes  from  satisfaction  of  “rational”  needs  of  the  customers  to   an  “emotional”  activity.  Modern  buyers  regardless  of  their  social  status,  income  or  age,  don’t  just  want  to   spend  money  on  food  and  pleasure  but  receive  something  more.  What  “more”  you  ask?  They  wish  to   know  where  you  get  the  ingredients  for  your  dishes  from,  where  your  chef  studied  and  why  your  store   uses  this  or  that  kind  of  dishware.  They  want  to  give  their  money  not  to  corporations  or  entrepreneurs,   but  to  people,  to  people  just  like  them.  Eventually  they  are  ready  to  buy  from  those  who  invest  their   profit   in   social   development.   In   the   age   of   total   time   pressure   people   not   only   leave   their   money   in   restaurants,  but  also  something  more  valuable  –  their  time.  Therefore,  they  don’t  simply  need  just  any   breakfast,  lunch  or  dinner,  but  a  whole  complex  of  experience,  emotions  and  information.  To  enjoy  tasty   food  goes  without  saying  today,  it’s  expected  or  a  pre-­‐requisite.     At  the  dawn  of  the  restaurant  business  developing  in  Russia  it  was  enough  to  open  a  good  looking   restaurant  with  decent  cuisine  from  a  foreign  chef  and  success  was  pretty  much  guaranteed.  Then  came  
  • 2. the  time  when  it  was  necessary  to  create  a  brand  or  reference  brand,  such  as  Ginza  Project  or  Novikov   Group  of  Companies,  and  the  guest  would  go  to  that  store.  Today,  however,  with  the  development  of   ever   changing   technology   and   new   media,   the   main   “criteria   of   choice”   is   not   advertising,   not   the   brightest  sign,  nor  the  celebrity  chef  but  reviews  from  other  people  which  are  able  to  disturb/subvert/   or  even  kill  your  business  for  a  couple  of  weeks  or  longer!     Therefore,  the  role  and  responsibilities  of  today’s  marketing  experts  has  changed  dramatically.  In   order  to  make  a  restaurant  successful  one  has  to  work  on  creating  an  overall  concept,  determining  touch   points   of   your   brand   with   your   guests,   investigating   various   “influence   agents”,   as   well   as   planning   thoroughly  the  strategy  and  social  media  communications.     It’s   not   restaurant   critics   and   chefs   who   determine   the   restaurant’s   success;   it’s   any   of   your   guests,  here  and  now,  in  real  time.  While  previously  restaurants  often  managed  well  without  systematic   research,   today   the   company’s   image   is   created   in   the   information   space   (social   networks,   mobile   applications,  internet  sites,  etc.),  and  quite  often  without  the  company  itself  being  involved  in  it.  Not   knowing  how  to  handle  this  massive  information  resource  may  well  destroy  your  business  completely.     Marketing   has   changed   fundamentally   and   I   think   you   bought   this   book   because   you   realize   it   yourself.       Traditional  media  is  rapidly  losing  influence  and  power,  newspapers  and  magazines  are  closing,   advertising   billboards   become   less   popular   and   our   everyday   life   focuses   on   the   screens   of   our   computers,  tablets  and  smartphones.     “Push”  type  of  advertising  is  rapidly  losing  its  efficiency  as  customers  have  a  sheer  endless  variety   and  choice  of  goods  and  services  and  have  the  opportunity  to  evaluate  their  benefits  (and  drawbacks)   before   buying   them   simply   by   making   a   couple   of   requests   on   any   search   engine.   So   today   “pull”   advertising  is  the  name  of  the  game  whereby  various    advertising  technologies  allow  the  client  to  “pull”   information  on  your  offer  while  searching  for  something  similar.     At  the  same  time  don’t  be  too  quick  to  dismiss  existing  marketing  theories,  traditional  working   instruments  or  principles.  Most  of  those  will  still  be  useful  in  many  markets  across  Russia  in  the  next   several  years.   In  this  book  you  will  find  answers  to  questions  on  how  to  properly  combine  strategic  and  tactical   marketing   activities,   which   tools   are   most   effective   today,   how   to   manage   traditional   advertising   techniques   and   modern   communication   channels,   and   how   to   increase   profitability   with   simple   marketing  patterns.     While  constantly  repeating  “the  world  has  changed”  mantra  one  shouldn‘t  forget  that  this  process   is   constantly   ongoing,   and   with   the   pace   of   technological   development   we   see   today,   even   the   most   “modern”   today   may   become   “outdated”   sooner   than   you   think.   However,   I’ll   try   to   offer   you   a   reasonable   forecast   of   what   the   nearest   future   holds   for   restaurant   marketing.     And   all   the   latest   examples   of   innovative   marketing   technology   will   be   continuously   be   published   on   my   website   www.avrutskaya.com.  Here  you  can  also  ask  me  questions  and  receive  individual  consulting.     Battle  for  the  guest  is  not  primarily  a  fight  against  competitors;  it’s  mainly  an  attempt  to  excel   oneself.       The  future  has  come!