Stimulating Customer Loyalty

Promote Your Business Restaurant Industry By American Express November 6, 2015

Stimulating Customer Loyalty

Loyal customers are crucial for a restaurant’s success. Not only are they responsible for the majority of sales – some report 70%+, they are important because they refer customers via great word of mouth. While many restaurateurs focus on creating lasting relationships to stimulate loyalty, some are also using mobile technology to manage and track customer data, eliminating paper and plastic cards, making it seamless for the customer to participate.

Building lasting relationships: Van Eure, Owner, The Angus Barn, Raleigh, NC, estimates that 60% of guests are regulars and some are second generation. “We spend our marketing/advertising dollars in-house on things that ensure our guests have a great experience when they are with us and will return.” Our Wild Turkey Lounge regulars have their names engraved on brass plaques placed above the bar; cigar bar regulars have their names engraved on the tin ceiling; and a few tables even have plaques with customers’ names engraved. Van adds, “Servers have their own business cards to give to guests and some of our most loyal guests request their favorite server each time they come in.” Guests who are celebrating birthdays are invited to decorate their cakes in the kitchen. ”We also pay special attention to children, inviting them into the kitchen to decorate their ice creams and letting them choose something from our toy chest. In fact, they are some of our most loyal customers, and when their parents ask where they would like to go out to eat they often say, ‘The Angus Barn’”. . .Karim Guedouar, Service Director, Restaurant Daniel, New York, NY, also believes that building relationships is key to creating loyalty and the reason that Restaurant Daniel has so many regulars who have been with them for 20 years. “Whether you call it loyalty, relationship, friendship, attention to detail, or caring, we go the extra mile to show our guests that we care and ensure that they return.” “For example, he says, noticing that someone is left handed and re-arranging the glassware, sending notes and birthday/anniversary cards, and more and more we’re advising and booking restaurant reservations for our guests abroad.”

“The little touches make a difference, making guests feel special and develop loyalty.” – Karim Guedouar, Service Director, Restaurant Daniel, New York, NY

Loyalty programs:“As our restaurants increased in number to 24 this year, it became clear that we needed a system to track and understand who our guests are, so that we can acknowledge them and that’s why we created LDV Lifestyle,” explains John Meadow, Founder, LDV Hospitality, hq New York, NY. “We have 12,000 VIP members in the New York market alone, who account for one-third of our New York revenue. These people are putting their social life and social existence in our hands – hosting business dinners, holiday parties, dinners with friends, etc. – and technology gives us a means to understand them.” John says that having a human relationship with VIP members is key and to do that there is a staff of three who manage members’ reservations and requests, follow up with them after they’ve dined, and check in every couple of weeks. “There is no recipe for who is invited to join. We keep it genuine and simple. If someone gives their card to the maître d’ or pulls a server aside to tell them they had a good experience, the information is passed along to the Lifestyle team who then sends an invitation card with a questionnaire about preferences.” John adds, “It’s only worth the human effort put into it. When we started tracking data numbers for Lifestyle members against productivity, our managers were reluctant, as it required more paperwork. Once we began including percentage of sales derived from the Lifestyle program in the weekly reports, they saw how much these members contributed to our bottom line, and it peaked their interest and involvement in providing information.”

“We’re in a human business and needed to figure out how to scale genuine human connection when scaling our business.” John Meadow, Founder, LDV Hospitality, hq New York, NY

According to Jim Howard, Director of Marketing, Patxi Pizza, hq Sausalito, CA, as Patxi’s grew, it too reached a point where a system was needed to keep track of loyal customers, as they had been able to when they had only a few units and knew customers by sight. Patxi’s uses Thanx technology that tracks spend – dine in, take out, and delivery – tied to the customer’s credit card. “Tracking is seamless, there are no cards to carry, and rewards are automatic,” explains Jim. Customers receive an alert when an award (for spend or simply because it’s Thursday or Patxi’s receives an award, etc.) is sent. Since the program began two years ago, Jim reports there are nearly 12,000 members, of whom 5,000 are very active, having made purchases in the last two or three months. He notes that the system also automatically reaches out to members who have lapsed. “If someone hasn’t been in for 90 days on the 90th day, a $10 off reward is sent. Not only do we have customers return and use the $10, but they come back a second, third and fourth time. That little treat puts Patxi’s back in the customer’s restaurant rotation.” Jim says that the program has been in place for six months and has brought in well over $100,000 in revenue from customers who had lapsed and hadn’t been in for three months . . .Scott Wise, owner, Scotty’s Brewhouse, hq Indianapolis, IN, says recently it was time to simplify their VIP loyalty program. ”We had a lot of bells and whistles on the loyalty program that we’ve used for 10 years and it became too complicated for our customers and our staff to use, so we have just moved it to mobile technology and simplified it.” Our 100,000 VIP members now access the loyalty program on an app, along with mobile pay, and a social shouting option. To sign up all you need is a mobile phone number,” he says. Now perks like “kids eat free on Tuesdays and Fridays” are automatically credited when members pay, and members receive a free meal on their birthdays and free dessert on their anniversaries. Scott says they can do segmented marketing, too, via the VIP program, i.e., send a lunch freebie to someone who only comes in for dinner. “Being able to easily and quickly contact our VIP members means we can send them perks and stay top of mind,” explains Scott. “Not only do are these people our most frequent and loyal guests, on average they spend $5 to $8 more.