Operations
How to Build and Grow a Restaurant Referral Program
5 min read
Jun 6, 2024
5 min read
Jun 6, 2024
Word-of-mouth marketing is still the most effective way to reach new customers. In fact, 61% of diners turn to friends, family and coworkers to discover new restaurants.
While it might seem a little old school, nothing beats a personal recommendation from a diner who knows and loves your restaurant — not even social media influencers or review sites. Only 22% of diners turn to influencers for restaurant recommendations and even fewer visit Yelp (15%).
But there’s a way to make word-of-mouth recommendations even more powerful — incentivize them through a restaurant referral program.
Keep reading to learn about the benefits and best practices of referral programs.
Creating a restaurant referral program isn’t just a smart marketing move — it’s a mutually beneficial way to turn diners into your biggest advocates.
You get more guests, and your guests get rewards — what’s not to love? Here’s how to create a referral program that builds a community of supporters who promote your restaurant both online and off.
Clear objectives guide your program's structure and help measure its success.
Common goals include:
Even if your goals include all of the above, it’s important to quantify them. Measurable goals will help you evaluate your program’s success. For example, 50 new guests each month or a 20% increase in repeat visits in six months.
It’s also important to set key performance indicators (KPIs) to track your program’s success:
While you can set up a referral program on your own, using software like SevenRooms streamlines — and automates — the process. This means team members won’t have to manually create links, track referrals or reward guests.
When selecting a program, look for essential features like automated reward distribution, easy integration with your existing POS, CRM and email marketing software and detailed analytics.
For example, SevenRooms’ software lets you create a referral program in minutes. Once you’ve set up your program, including choosing Perks like early reservation access or a kitchen tour, your work is largely done.
When participants sign up, they’ll automatically receive a personal link to share with friends and family. (This is also how you’ll track guest participation.)
Now comes the fun part — choosing rewards. They should be enticing enough to encourage participation but also sustainable for your business.
Monetary rewards like discounts aren’t your only option — experiential rewards can also be motivating.
Before you settle on the right rewards for your program and guests, consider these best practices:
Instead of assuming what your customers want, why not ask them directly? This ensures your rewards are attractive and makes participants feel valued and heard.
Email your customer base to ask guests what types of rewards would motivate them to participate in a referral marketing program. Pay attention to overlap — if the majority of guests want the same rewards (or similar), add them to your program.
Use a customer relationship management (CRM) system like SevenRooms that connects referral data to guest profiles. This provides insight into diner behavior and preferences. It also enables you to segment customers based on demographics, spending habits and visit frequency so you can understand what drives customer behavior.
For example, high-frequency diners might be more motivated by rewards that enhance their dining experience, such as exclusive menu tastings, priority reservations or personalized service. While value seekers may be more enticed by loyalty points or gift cards.
Offering a variety of rewards that speak to different types of diners widens your program’s appeal and effectiveness.
Guests can’t sign up for your referral program if they don’t know about it. Promote it everywhere possible for the best results.
Drum up excitement about your referral program on social media. Craft engaging posts and stories that showcase the benefits of joining the program and feature top participants. Nothing is more persuasive than showcasing an actual customer redeeming their reward.
Create personalized emails that explain the perks of your referral program and provide clear instructions on how to participate.
Use guest data to identify high-value guests so you can send them personal invites to your referral program. For example, SevenRooms' CRM lets restaurant owners create custom tags like "Regular” and "Positive Reviewer" to easily define and segment these guests.
Use this information to create customized emails that address guests by name and feature targeted perks. For example, if a guest has attended your wine tastings in the past, let them know they’ll get a bottle of their favorite red upon referring 10 guests. This can be highly motivating and encourage more participation from your most valuable guests.
Dedicate a page on your website to your referral program so you can highlight rules and rewards. You’ll also be able to direct guests here if you use a QR code on promotional materials. Use clear language so diners understand how to sign up, share referral links and redeem rewards.
Consider partnering with neighboring businesses to promote your program. Ask to put flyers in store windows or at cash registers to reach new customers.
Influencers can also be beneficial. Look for those with an engaged following that aligns with your target market. Content that shows influencers redeeming rewards, like special menu items and gift cards, can entice their followers to sign up for your program and refer friends, too.
A customer referral can turn into a customer for life. Invest in a restaurant referral program to incentivize your biggest fans to keep customer retention high and a steady stream of new business flowing into your restaurant year-round.
Learn how SevenRooms’ Referral Program, CRM and Marketing Automation software can help you reward guests and create highly targeted offers that foster loyalty and retention. Book a demo today.
SevenRooms’ Referral Program gives you the option to reward referrers and referred guests, ensuring your program benefits both parties. For example, existing customers might get a gift card for referring guests, while new customers get a complimentary welcome cocktail. This creates a memorable experience, helping to ensure both guests return.
