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What Is Happy Hour?: Happy Hour Meaning

By
Brad Johnson
Table of Contents

Whether you recently opened your establishment or have been open for a couple months, there’s no doubt you’re learning how to increase restaurant sales. Winning customers is not easy in the US hospitality industry, which sees over 13,000 new restaurants and 1,800 new bars open every year. 

In order to stand out from the competition, you need effective restaurant marketing strategies. Your restaurant profit margin won’t grow on its own. You need creative outreach ideas that real people connect with. 

One such idea is the classic happy hour. If executed well, happy hours drive significant profits for your business when it would otherwise be falling behind. 

So, what is happy hour? Let’s take a closer look. 

What’s Happy Hour?

Happy hour is any event, promotion, or discount during bar and restaurant slow hours that encourages people to stop by and make a purchase. Restaurants’ and bars’ slow hours are between 2pm and 6pm when most people are still at work or school. 

Think about it: when do you normally go out to eat, or grab a drink with friends? If you answered lunch, dinner, or late at night, you’re spot on. These time blocks are when most people make social plans. 

So what about the rest of the day? That’s where a happy hour comes in.

Why Do Bars Have Happy Hour?

Happy hours are a marketing strategy for the low-activity transition between two high-sales periods: lunch and dinner. It is a common and valuable limited time offer, or LTO (see LTO meaning). And it's a big part of how to improve customer satisfaction in restaurants.

Running a happy hour for the first time may feel confusing or daunting. It’s important to fully understand your goals as a restaurant or bar owner so you can make the most of them. You should also read about what time is happy hour so you can optimize your resources.

What Are Happy Hours Used For?

The purpose of a happy hour is primarily to attract new customers and secondarily to boost bar profitability. Achieving both of these simultaneously is even better. Hospitality businesses tend to have low profit margins as is, so whenever customers aren’t buying food and drink, net profit slows down or disappears for a while. 

This is why regularly implementing happy hour ideas is so useful. It encourages patrons new and old to stop by, it’s a great way to liven up an atmosphere, and it offers a great reason for coming back. 

The reason happy hours shouldn’t have the primary goal of making money is because promotional pricing is rarely profitable upfront. Use the timeless buy one get one offer as an example. If all you’re doing is offering a free item whenever someone buys the same product, you would only break even.

One way bars combat this is by offering a lower-priced item for free once a customer purchases one higher-priced item. This keeps your profit margin intact, inventory fresh, and sales coming in. 

Another way happy hours are effective is when someone wants to check out your bar and brings their friends. They may be looking for happy hour drinks, but the whole group ends up buying some food. This means you just landed more sales for the day; well done!

Pulling off a successful happy hour is something to be proud of, and it often means your supply will dwindle faster. If you need a simpler way to stay on top of inventory, we have you covered.

BinWise is an all-in-one bar inventory management system that eliminates tiresome manual counting. We also offer BinScan, a high-performance inventory scanning app that scans more than 100 bottles per minute. Our platform’s POS integrations, streamlined invoicing, and reporting tools provide the information you need at a glance. Book a demo now to learn more about BinWise.

What Are The Most Popular Happy Hour Ideas?

Happy hours are easier to accomplish when you have a concept and budget ready. Here are five of the most popular and effective happy hour ideas:

  • Menu options exclusive to happy hour
  • Flights of four or more beers on your drinks menu
  • Easily shareable dishes (incentivizes people staying longer)
  • Value-priced items (a great fit for bar beer pricing)
  • Trivia, video game, and themed competitions

The best part about most of these ideas is they only require a little tweaking of your existing business operations. You may need to invest in flight trays and some menu engineering, but this can be done in a few days or less.

Think about which promotional idea would fit your establishment and what marketing materials you’ll need. Then talk with your staff about it, get a date on the calendar, and make it happen!

Another Name For Happy Hour: Happy Hour Names

Happy hours are also called cocktail hours, coffee breaks, afternoon drinks, or even sober happy hour. After all, not everyone who enjoys going out is always going to pick up an alcoholic beverage. 

Because there are so many happy hour names, it’s a good idea to have multiple drink types available. Though most people go to happy hours for alcoholic beverages, you increase the likelihood of a purchase with more drinks to choose from. 

You can also combine drinks for even more ways to attract new patrons. Coffee liqueurs, Bloody Marys, and mimosas are examples of beverages that are just as popular as straight alcoholic drinks. 

Happy Hour Is The Best Hour

Happy hours are a low-cost, measurable way to increase engagement and sales at bars and restaurants. Consumers who haven’t heard of your establishment before now have a great reason to try it. People who love their experience will share with family and friends, and word of mouth is still one of the most effective marketing channels. 

A happy hour is particularly useful for restaurants and bars without large marketing budgets. Instead of dropping significant money on digital ads that may not resonate with customers, you’re providing a low-pressure, open-ended experience. Test a few happy hour ideas until you find one that your primary customer base loves.