Why Every Restaurant Should Have a Customer Loyalty Program

How many of your guests are familiar faces—those who return time and time again? If you’re like most restaurants, approximately 40% of your business is from repeat customers while the remaining 60% is from people you’ll never see again. One way restaurants are increasing repeat business is by implementing loyalty and rewards programs to engage with customers and pull them back in. If you haven’t given such programs a look, now is the time. drmg loyalty program

Loyalty research firm COLLOQUY estimated in their most recent study that total loyalty enrollment currently sits at 3.8 billion memberships worldwide, growing by double-digital margins each year. Today’s restaurant-goers are more tech-savvy than ever. Armed with smartphones and familiar with the potential benefits of loyalty programs from brands such as Starbucks, Walgreens, and giant restaurant chains, getting them to opt into a loyalty program and participate won’t be a challenge.

With a loyalty program tied to your POS system, customers can enter their phone number or email address join your program. From there, you can offer them coupons, reward them for purchases, and more. The great news is that not only will you create more engaged customers who benefit from participation, but you’ll more than pay for the cost of such a solution.

Benefits of restaurant loyalty programs

For example, loyalty program vendor Fivestars has an ROI calculator on its website. Using modest numbers ($500,000 in annual revenue and getting 10% of your customers to join your loyalty/rewards program), you can bring in an additional $20,000 of sales in 12 months. That’s on top of creating happier, repeat customers. Use the calculator with your own sales figures to see how you’d benefit financially.

A fringe benefit of a loyalty program is pushing out surveys to your members. Not only can you ask about past dining experiences, but you can use the collected data to make menu adjustments (e.g., “Do we offer enough healthy choices?”), learn if your customers like you enough to recommend you to a friend, and more. This type of information is priceless and can help you identify ways to improve your business and retain customers.

Shopping for a loyalty program

If you’re ready to implement a loyalty program, the first thing to do is check with your POS vendor to see what reputable loyalty integrations are available. Look for programs that provide intuitive opt-in methods (phone number or email is a good start) and give you options when creating your program.

It’s good to be able to choose between points-based rewards, coupons, special holiday promotions, time-sensitive campaigns, and other unique promotions. Additionally, integrated marketing automation tools will allow you to engage with customers on even deeper levels. Also, ask about reports and analytics that will allow you to make informed decisions about your program and customer behaviors. Finally, select a reputable vendor that can share best practices and lessons learned from other restaurants like yours.

With a little work, you’ll have your loyalty program off the ground and providing returns in no time.

 

Image courtesy of drmg.com. 

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