Whether you’re running a franchise with several locations across the country or a sandwich food truck in your hometown, you will need loyal customers in order to survive, and thrive, in the restaurant industry. Even if you don’t have the resources to run huge ad campaigns, that doesn’t mean you can’t gain the attention of the people who are eager to find their new favorite dinner spot.
Having a customer loyalty program is a must in our day and age. If you want your customers to become regulars, you have to provide memorable dining experiences that go way beyond the mere enjoyment of the food you serve.
Why is loyalty important for restaurants?
Loyal customers are valuable because they foster a restaurant’s growth. There are many advantages to having returning customers, as they spend more when they purchase and recommend your restaurant to their friends and family (free marketing!).
Benefits of a successful loyalty program
A successful restaurant loyalty program can boost your restaurant’s profits. Loyal customers who are given a personalized experience eventually become a source of passive income for your restaurant. Serving repeating customers will also help you save on operation costs, as it costs more to serve new customers than returning ones.
Research published by Bain on the value of online customer loyalty affirms that someone who has been a regular at a business for about 3 years is inclined to spend 60% more than the amount of money they did when they were a new customer (source). Loyal customers are bound to spend higher amounts of money more often, while also providing your restaurant with word-of-mouth exposition.
How have loyalty programs evolved?
The earliest record of loyalty program ideas in North America goes back to the 18th century, where retailers would give customers copper tokens they could use to redeem products on later purchases. In the 21st century, a digital loyalty program can offer clients personalized rewards based on data of their preferences.
The first modern loyalty programs were based on stamp collection programs. The most common rewards program strategy of the 20th century consisted of printed coupons, which could be redeemed under certain conditions. The latter half of the century, in particular the ‘90s, saw the rise of card-based restaurant loyalty schemes. Cards were easier to monitor than coupons and could fit in a wallet, making them ideal for loyalty programs.
The current age saw technological advancements at an accelerated scale and alongside them the birth of the digital restaurant loyalty program. E-commerce, digital payment options, and many other perks of the information age allow restaurant owners to manage key areas of their business from the comfort of their preferred devices. There is no point in carrying cards around when we have our phones.
What is next-generation loyalty?
The loyal customers of the future will engage with their favorite brands in digital ecosystems. Personalized rewards and all kinds of perks can be offered to customers, with advanced AI solutions being able to predict and implement strategies designed to maximize their enjoyment.
Today’s customers are tech-savvy and dynamic. They can easily switch between different devices, websites and channels when they are shopping. Loyalty programs need to reflect this dynamism and develop partnerships with companies to offer customers different experiences, products and services to better meet their needs.
In the future, we can expect businesses in the hospitality industry to partner with companies in different sectors in order to create joint loyalty programs in order to improve the customer experience and gain a competitive advantage.
Why do customers return to a businesses’ online platform?
Having a customized ordering app and website for your restaurant is a great way to keep regular customers coming back for more thanks to an integrated loyalty program which offers them exclusive offers, unique benefits and promotions.
Bain & Company’s research shows that the profitability of an online business can be positively impacted by loyal customers by a large amount (source). According to this research, there are four main reasons why customers start returning to a businesses’ online platform.
1. Order fulfillment
It is very important for customers to feel satisfied with their purchase. If your users feel like they didn’t get the exact items they ordered, had a bad experience with delivery, or feel like they didn’t receive the right pricing information when paying, this could negatively affect their customer experience. Restaurant owners interested in having better delivery options can count on UEAT’s ordering system.
Your customers must always feel like they’re getting a good deal. You don’t have to offer the lowest prices in the business to get loyal customers. Instead, you have to make them feel like your menu items are really worth the price they will pay for them. Offering discounts, promotions, and rewards is a great way of catching people’s eyes and upselling products, while also getting customers acquainted with the different items on the menu.
3. Customer service
Research shows a correlation between customers who claimed to be satisfied in surveys and customer retention rates. In the study, a scale from 1 to 5 was used to measure satisfaction, and the results showed that for each point increased there was also an increase of at least 5% in customer retention rates (source).
4. Platform functionality
A whopping 66% of online customers drop their purchases and abandon brands because they have trouble navigating their online ecosystem (source). That means that the majority of people will only buy online if they have a clear understanding of the payment options, the layout, and the functionality of the platform they are using to make their purchases.
How can restaurants stand out to make their loyalty programs valuable?
Use a state-of-the-art online ordering system
Having your own AI-powered online ordering system comes with many benefits. Customers who interact with an app of your own will have your logo and the colors that characterize your brand displayed to them, in contrast to the generic interface prevalent in third-party apps.
UEAT’s online ordering system is intuitive and extremely easy to use. Customers just need to get a hold of the app to start purchasing, without the need to go through the hassle of creating an account. It only takes a customer a short three-step process to order food, and there are no commission fees when a purchase is made.
Reap the benefits of Artificial Intelligence
AI is one of the best companions to any modern enterprise. Working with artificial intelligence is like hiring an employee who never needs to sleep, is always alert, and is able to keep tabs on the needs and desires of every customer. For restaurants, this means providing your customers with their own personal butler.
Artificial Intelligence is able to keep a record of the behavior of your customers and create a personalized experience for them every time they interact with the platform. Personalized offers and rewards can be customized. Basically, your AI teammate knows what menu items to show customers and how to upsell the right way.
Organize contests and giveaways
Contests are the perfect opportunity for your brand to get some extra recognition. Even if not every customer can be the lucky winner, the connection your customers feel with your restaurant will be stronger. Since having more people playing can up someone’s chances to win, contests are also a great way to get people to talk about your place to their friends and online community.
Join the conversation on social media
If you don’t have a social media presence already, then it might be time to get started. Not only does it work as a great way to promote your restaurant and any digital restaurant loyalty program you want to launch, but it is the perfect place to engage and interact with your customer base.
Creating social media posts about your promotions will increase your outreach, plus it will create a fast and easy way for others to share your restaurant’s information. If you’re ready to get in on the fun, others will follow, and together you can promote content that will put your brand on everyone’s screens.
Get the best out of smart marketing tools
A digital restaurant loyalty program can be improved with the use of smart marketing tools. A gift card management system or rewards program can be easily linked with UEAT’s platform, so your customers have access to all kinds of goodies without leaving the app’s ecosystem.
Not only can your customers get the best deals delivered right to their phones, but as a restaurant owner you also benefit from the data solutions provided by UEAT. Integration with Google Analytics and Tag Manager means that you can track and increase the performance of your strategies. You also have access to detailed reports of changes to customer behavior, current online restaurant trends, and much more.