How to increase customer loyalty in restaurants
If you’re looking to increase revenue and build a loyal customer base, you’re in the right place. The relationship between customer loyalty and profitability is well established, with studies showing that retaining just 5% more customers resulted in reported profit increases of between 25 and 125. Loyal customers not only visit your venues more often but also reduce marketing and operational costs for your business.
At Access Hospitality, we’ve helped countless restaurants maximise customer loyalty and revenue, and we’re excited to share our expertise with you.
In this article, we’ll explore the power of customer loyalty and provide a five-step guide to increasing loyalty in your customers, including how to leverage technology to support your efforts.
Why customer loyalty is important for restaurants
Customer loyalty is crucial to the success of restaurants, providing a wide range of benefits that can make the difference between success and failure in a highly competitive industry.
Check out the business benefits of increasing customer loyalty in your restaurant:
- Increased revenue: Loyal customers will visit your venue more often, spending more money with you and in turn, increasing your revenue.
- Cost savings: Acquiring new customers is more expensive than retaining existing customers reducing your marketing activity spend and helping you create more streamlined and effective targeted marketing campaigns.
- Brand advocacy: Loyal customers can become advocates for your restaurant, recommending it to their friends and family and sharing pictures and posts on social media. This can help to generate new business and increase your restaurant's visibility.
- Competitive advantage: In a competitive industry, customer loyalty can give your restaurant an advantage. It can help you to stand out from the competition and build a strong reputation in the community. Loyal customers are more likely to join reward programmes and create a virtuous circle of loyalty generation.
- Feedback and improvement: Loyal customers are more likely to provide feedback to help improve your restaurant. They are also more forgiving of mistakes, giving you a chance to address any issues and retain their loyalty.
Customer loyalty is crucial for the long-term success of restaurants. By focusing on building strong relationships with your customers and providing excellent service, you can increase customer loyalty and drive business growth. In the next section we will look some more general tips for creating a positive relationship between you and your customer.
How can restaurants keep customers happy and build customer loyalty?
Keeping your customers happy is the key to success of any restaurant. There are several ways that restaurants can keep customers happy and build loyalty:
Provide excellent customer service
Make sure your staff are well-trained to provide exceptional customer service. Be friendly, attentive, and responsive to your customers' needs. Customers also appreciate timely service so responding quickly is important. This applies to communications outside of the restaurant too so make sure you are monitoring your social media channels and other channels so you can engage with and reply to your customers.
Personalise the customer experience
Personalise the experience for your customers by addressing them by their name or remembering their favourite dish or drink. This applies to marketing as well. Emails that address your customer by name or promotions that take in personal factors such as birthday offers make your customers feel special and valued.
Consistency in quality
Customers like to know what to expect on their visit so don’t implement changes without giving them plenty of thought and, where appropriate, letting your customer know of any major changes in advance, perhaps by email.
Be transparent
Be transparent about menu items, pricing, and any special promotions or deals. Customers want to feel that you are delivering value and being honest, which builds trust.
Address customer concerns
Even with the best set up and staff, not everything will go exactly to plan. Always address customer concerns quickly and professionally. Take customer feedback seriously and make changes as needed.
By implementing these tips, you can keep your customers happy and create a positive experience for them. These general principles apply both inside and outside your restaurant. Clear, timely, personalised communication will make your customer feel at ease before they even step inside your restaurant. Happy customers are more likely to return and recommend you to others, which is essential to driving revenue.
5 ways to improve customer loyalty
1. Provide an experience
Today’s consumers, particularly of the younger generations increasingly value experiences over traditional transactional dining experiences. Just look at the wealth of pop-up cinemas, themed restaurants and bars and activity-led venues in your local town or city to see the impact of experience-led dining.
Another way you can provide a memorable experience is by creating something more personal and tailored to your guest. That could be as simple as looking at your current offer – a bottomless brunch is a great shared experience for a group of friends, or a birthday party, or an intimate tasting menu with finger foods and candlelight to elevate a date night experience.
Creating a memorable experience will help you build loyalty and have your guests keen to recreate their positive experience.
2. Utilise customer data
From signing into the Wi-FI, booking a table online, to ordering through the EPoS or order and pay system – your customers encounter various technology touchpoints throughout their experience. Each of these points offers you an opportunity to collect customer contact details so you can retarget your customers in the future to encourage return visits.
Connecting all these technology touchpoints in one place helps you to analyse your data, segment your audience and create actionable insights for your marketing activity.
3. Offer a customer loyalty programme
Customers love loyalty programmes. According to a 2018 YouGov survey, 72% of Brits think they are a good way to reward customers and 77% are members of at least one such scheme. Our own Access Hospitality survey revealed that 40% of consumers said that they would want to use a mobile app loyalty programme to strengthen customer loyalty.
Rewarding customers for their repeat business with a loyalty programme that offers discounts, free items and other incentives encourages them to keep coming back and builds a sense of loyalty to the restaurant.
Read our guide on customer loyalty programmes for restaurants, where we showcase a variety of customer loyalty programmes and provide a seven-step walkthrough on how to set up your own customer loyalty programme at your restaurant.
4. Make it personal
According to a survey by Accenture 91% of consumers say they are more likely to shop with brands that provide offers and recommendations that are relevant to them. This statistic holds true with hospitality too.
We all want to be recognised as individuals so any loyalty scheme that rewards customers in a more personal way stands a greater chance of success.
Connecting your EPoS solution to your restaurant CRM enables you to collect details of when customers visit and what they buy, which can help tailor promotions accordingly. For example, if a customer always orders a steak when they visit your restaurant, why not offer them a free side to accompany it on their next one, or suggest a wine that would complement their favourite dish.
5. Listen to feedback
Invite your customers to share their feedback in venue, after their visit and periodically to get a full view of your customer’s opinions. And then take them seriously. Use customer feedback to make improvements and demonstrate that their opinions are valued. Getting specific with your feedback survey questions can help you get relevant insights – for example, if you are noticing a downward trend in order value, you might include a question that asks customers about whether they think your menu provides value for money or if they find it expensive – which in turn will help you develop your menu to suit your guests.
Implementing these strategies will help you improve customer loyalty, keep your customers coming back and establish your reputation locally.
Summary
In this article, we have explored the importance of customer loyalty beyond just repeat business and how it is crucial for the success of restaurants. Providing great service and experiences, along with personalized marketing campaigns and loyalty programs, can help generate loyalty in customers. To further build brand loyalty, Access Acteol, our hospitality CRM, enables businesses to gather insights about customers' needs and preferences.
Find out more about our loyalty and rewards solution, as part of our CRM
