There’s No Such Thing as a Free Appetizer (Ep. 171)

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(Photo: Alexander Baxevanis)

(Photo: Alexander Baxevanis)

This week’s episode of Freakonomics Radio is called “There’s No Such Thing As A Free Appetizer.” (You can subscribe to the podcast at iTunes, get the RSS feed, or listen via the media player above. You can also read the transcript, which includes credits for the music you’ll hear in the episode.)

It was inspired by an e-mail from a listener named Larry Tingen, a college math instructor:

My fiancee and I are avid listeners and lovers of Freakonomics. We were at a Mexican restaurant this weekend and the first thing that happens is we are given chips and salsa — even before drink orders. Kelli asked me why I thought so many restaurants serve you free food (e.g. chips and salsa, bread, etc.) prior to taking your order? I couldn’t come up with a good reason. To me, it seems to go against the restaurant’s financial interest because most people will “fill up” on the free food, then order a smaller/cheaper meal. … Does the free food make customers more likely to order meals that have a better profit margin? What’s going on here?

Good question, Larry! We spend this podcast trying to answer it. Are we successful? Hard to say. We discuss a number of theories, but perhaps the most persuasive answer is — well, we’ll get to that in a little while.

Helping us sort out the question are:

Among the theories we entertain:

  • Free food at the start of the meal may actually encourage people to eat more, by priming the pump.
  • Free food (especially bread and chips) encourages diners to order more drinks, which have a high profit margin.
  • Free food gives servers and the kitchen time to deliver the meal without the customer getting cranky (or, as one person calls it, “hangry”: i.e., “hungry” + “angry”).
  • Free food might make diners less likely to order dessert, which may be in the restaurant’s best interest if they are trying to turn tables quickly. (This point, we should note, is disputed by those who feel that turning tables is overrated, and that dessert can be perfectly profitable.)
  • Free food might make diners feel warm and fuzzy toward the restaurant, and think that they should reciprocate by not being cheapskates.
  • The “free” food we’re talking about here isn’t really free at all, but rather is baked into the menu prices. In other words, there’s no such thing as a free appetizer.

Finally, Andrew Haley suggests that free appetizers in restaurants may in fact be little more than a historical artifact:

HALEY: Before there were restaurants, there were taverns. Taverns served a set dinner at a set time for a set price. And the accounts we have of these tavern meals suggest that bread … was part of the meal. And this made sense after all. When you went to one of these taverns, you were paying for the meal with a single charge. And it was in the interest of the tavern owner that you filled yourself up with bread so that you would eat less of the expensive fishes and meats.

One last note: there’s no such thing as a free podcast either. We are, after all, a public-radio project — which means  we are supported by your contributions. So please visit our donation page and help us keep doing what we do. Depending on the size of your donation, you can take home a signed copy of Think Like a Freak or Freakonomics; a Freakonomics Radio t-shirt or mug; AND — this is new — you’ll automatically be entered to win a 13″ Macbook Air, donated by our friends at Tekserve in New York.


caleb b

I thought the podcast did a great job of highlighting the variety of reasons that free food might be given out. A lot of them are great reasons, yet it is so complicated that it is clear why the data are hard to come by.

Having worked in the restaurant business many years, I can tell you that bread does wonders to keep people satisfied. Unlike Europe where it takes 2.5 hours to eat a meal, folks in America show up to the restaurant HUNGRY and they want to eat right away. If you offer a nice bread, they get to eat a little something...it actually gets the appetite rolling a little, it buys you time to get their orders in...and it fills them up enough so they feel full faster...helping to turn that table. Many people would never order bread if you made them pay for it, but just having it keeps them happy.

The argument against table turning doesn't hold water because 80% of your business is IN CRUNCH TIME, or for dinner between 630-830pm. You absolutely need to turn those tables as fast as possible. As mentioned, there are many dining options, so folks typically walk out if the wait time is too high. Many won't come back and the 80/20 rule definitely applies in the restaurant business. Remember, restaurants lose money most of the week and make money on Friday and Saturday nights. The entire capacity of the restaurant is used then, so every table is critical in this situation. As a waiter, the LAST thing i want is someone ordering desert. It adds maybe $6 to a meal to which I could be starting a completely new table! If you want to highlight your deserts, make them half price after 9pm....

So given that it is ALL ABOUT the weekend nights AND the 80/20 rule, the NUMBER 1 thing that successful restaurants do is make sure that people have a good experience (timely, friendly, comfortable) and have that good experience consistently. In fact, it is number 1-3 and the number 4 thing would be the quality of the food. Need proof? The Olive Garden is still in business.

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Stephen Marsh (Ethesis)

I'm glad you mentioned Olive Garden. They used to have extremely good bread sticks. Ones worth buying some to take home. That changed many years ago and they never went back.

The breadsticks are for decoration, not for eating, they are part of the ambiance, like the wall art, not part of eating there.

B Wint

Who were the advertisers/supporters for this episode? I can't seem to easily find them with a web search or a search within the freakonomics.com domain. Where can I find a list of freakonomics advertisers in the future?

Mark

Hi freakonomics Steves

I like your shows, and look forward to many more topic-tackling.

But I noticed a discrepancy during the appetiser Podcast. Or an inconsistency. I hear the statement that the bread service is in fact not free, as it is calculated in the price. So basically, advertisements that offer something free, are not really giving something for free. Or that's how I interpret it anyway.
So how does that relate to the trunkclub advertisement offer 'send the rest back to trunk club at no cost' (22:51)? It would seem that the subscriber does pay for that service, in the same way that we pay for the free appetiser.

I found it strangely dissonant to hear something being offered at no cost, while that was exactly the topic being discussed, where the conclusion was that there was a cost for the consumer.

Could you explain where my thoughts have strayed, or, if they haven't, how you see this?

Kind regards from the Netherlands
Mark

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Stephen Marsh (Ethesis)

A free appetizer is really like getting a free chair to sit on or a free table to sit at ...

Michael C Trachtenberg

We used to live in Zurich. Bread served before the meal was often accounted for on a piecemeal charge basis when the bill came, as was every pad of butter.
We used to stuff our kids with bread to reduce their costed food order - ha, were we fooled.

Voice of Reason

I've also seen bread or salsa/chips as a perk for the customer or a cost of doing business to get them in the door. It's the same reason that restaurants have appealing décor on the walls, polite and attentive waiters, and restrooms (ignoring the fact that most states have rules requiring restrooms available for customers). They're all costs that are provided for you regardless of which food you order, but improve the dining experience and make customers more likely to think of that restaurant the next they dine out (or more likely to discourage a customer from going if it is not provided and all of the competitors do provide it).

Julie

One of the biggest differences in dining out in Australia compared to the US (other than the fact you call the main meal the entree!) is the free appetizer. It's extremely rare in Australia to be given free bread or chips before a meal. I think only really fancy restaurants do free bread, and obviously I don't go to a lot of those places!

Kim Etzel

I went to Outback Steakhouse one night for dinner. The wait was an hour for a table. But I nowhere to be so I decided to wait. 10 minutes later, a staff member walked around among all the poor waiting souls and gave out free Tasmanian Chicken appetizers. I thought it was such a nice gesture. Turns out it wasn't just nice; it was also a brilliant marketing strategy because as soon as I got a table, I immediately ordered a plate of Tasmanian Chicken.

Nemmcot Post

If the act of serving bread before the meal dates back to the early days of restaurants, there could also be a religious element to the origin. In Judaism, a meal is traditionally begun by making a blessing over bread to give thanks for the coming meal.

At Kosher restaurants even today you will often see a basket of bread placed next to a public hand washing station as it is traditional to wash one's hands before a meal and then not speak until the blessing is made and bread is eaten.

Margaret

At least part of the reason for this must be cultural. Aussie and New Zealand restaraunts just don't do it. The only place I have really encountered this is North America.

svend w.

Actually, I would like to make a distinction between bread and other appetizers. I think most europeans would consider the bread at a restaurant something you use to soak up and enjoy sauces or even salad dressings while eating one of the courses, not something you start to eat before anything is served. If you start eating the bread,you are signalling real big hunger or very slow service.
Some restaurants "over here" will bring you a small snack, maybe olives, cold cuts or something similar, and those are then the real "amuse bouches", to keep your mouth happy.

Isabel

It does seem like there is a lot of cultural variation here- in some places restaurants tend to provide free bread, or similar, and in some they don't. So wouldn't the best approach, if you really wanted to know why, be to try to identify the relevant differences(s) between free-bread and non-free-bread cultures?

mikemikemikemikemike

I was annoyed by this episode. I'm not sure what it was, but it's the first Freakonomics episode I've ever been annoyed by, and I'm pretty sure I've listened to every episode ever made. First, I felt like this was beating around the bush TOO much when the fundamental principle was a la carté vs all-inclusive. I think the thing that might have been annoying was the over-use of the typical jazz music that plays in most of the podcasts.

... maybe I'm just in a bad mood or something : (