3 Takeaways From SevenRooms’ Conversation with Former Yum! Brands CEO Greg Creed
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Customers love the convenience that delivery affords them, especially when they can’t leave their house or don’t have time to whip up a home-cooked meal, with 63% of consumers agreeing that it’s more convenient to get delivery than to dine out. Though delivery can help increase profits for your restaurant, particularly while dining rooms are closed due to COVID-19, to make it a viable revenue stream, you must take the time to foster direct relationships with your customers that will keep them ordering with your restaurant for years to come.
The best restaurant brands know that staying top of mind with guests through personalized and engaging marketing efforts is the only sure way to keep customers coming back to order with them time and time again. So how can you get more orders, more often? Read on to learn how brands across the U.S., including Fleming’s Steakhouse, Marea, Mexicue and Urban Grub, are leveraging their delivery offerings to boost revenue and increase guest loyalty.
One way to stay top of mind for guests is by creating a delivery or pick up offering that is only available on a certain day of the week — whether Taco Tuesday, Margarita Monday or in the case of Fleming’s Prime Steakhouse & Wine Bar, Tomahawk Tuesday. Offering guests a 3-course dinner for two to enjoy at home, Fleming’s is tying their offer to a specific day, drumming up excitement by only offering it once a week. Known in marketing circles as ‘scarcity marketing,’ this specific tactic plays into “consumers’ fear of losing their freedom of choice. Simply put, if a product isn’t [widely] available, it suddenly becomes more attractive.”
So why is this so powerful? That answer is two-fold. Guests want what they can’t have, and by making this offer only available one day per week, operators are guaranteeing a pop of orders when it becomes available. Plus, by naming your day of the week with something catchy, you’re keeping this offering top of mind when customers think about what they can order on a Tuesday night.
Offering discounts is one of the oldest tricks in the book to drive consumer engagement and generate more delivery orders for your restaurant. Best of all, it works, with 74% of consumers saying that promotions and offers can influence where and what they buy. When used effectively, offering discounts can boost your likelihood of a sale by 8 times.
Take Altamarea Group’s Marea, a Michelin-starred restaurant in the heart of NYC, for example. By utilizing robust guest data to accelerate their email marketing efforts, they are able to craft targeted discount offers for their customers that are used time and time again to drive more revenue to their bottom line. Offering 25% off their reserve wine list, and upwards of 50% off their regular wine list, they’re creating a new way to engage with guests outside the dining room through special promotions. Best of all, the numbers don’t lie, with Marea averaging 24+ orders per day at an average order value of $138. That accounts for several thousands of dollars a day in earned revenue, even with their dining rooms closed.
By taking advantage of relaxed regulation related to alcohol delivery due to COVID-19 restaurant closures, Marea is able to offer a higher margin item for guests at a steep discount, while still benefiting their business by boosting revenue and depleting existing wine stock. Consumers love to feel like they’re getting the best ‘deal,’ and discounts are a low-risk, high-reward way to do so.
Consumers are barraged with an endless stream of marketing messages. It’s hard to break through all the noise. That’s why, as a restaurant brand, you need to think about what truly drives people to your brand and makes you stand out from the crowd. Why do your guests visit your restaurant time and time again? And how can you capture those same guests and convert them into loyal delivery customers? In a world where it’s 7 times more cost-effective to retain an existing customer than acquire a new one, the answer may lie in value-added marketing.
As a business, you love to bring value to your guests. Whether they’re dining in or ordering out, understanding who your customers are can help you shape value-adds that will increase orders for your restaurant. Mexicue is one such brand, fusing Mexican and BBQ flavors topped off with a smoky margarita or two. With nearly 14,000 followers on Instagram, and a loyal contingent of customers across NYC, DC and Connecticut, they were able to boost online sales by offering something none of their customers could refuse: free margaritas for placing a delivery order.
By understanding who their guests are and the reasons they would typically dine with them (i.e. their margaritas), they were able to successfully pivot to offering delivery, while still providing value to their loyal customers through free drinks. With value-added marketing, you can ensure loyalty by turning your customers into advocates for your brand. Whether offering something big or small, this type of marketing can have a huge impact on your bottom line.
When COVID-19 forced the closure of restaurants throughout the world, many hospitality operators were left figuring out how they could leverage their existing food and beverage offerings to drive more demand with their customers. With selling excess inventory top of mind, several brands moved away from the dining room, and into selling fresh produce and house-aged meats. Tapping into their existing database of loyal guests, restaurants were able to leverage their exclusive offerings to drive demand. According to Impact, “When your product or offer is exclusive or limited, so are its benefits. Being one of the few to have access to these benefits puts you in an elite group…” This exclusive offer is what can help drive further sales for your business.
Urban Grub in Nashville, TN, is a casual fine dining spot featuring a diverse menu of fresh seafood, house-made pasta, and in-house dry-aged steaks. When they were forced to close due to the current health crisis, they still had many of these dry-aged steaks, ribs and cured meats sitting in their restaurant waiting for hungry customers. So, as part of their delivery and pick up offerings, they decided to create a Butcher Shop — offering exclusive access to their prime meats to loyal customers and locals alike. Offering exclusive products that can’t be found anywhere else creates a sense of urgency with guests to place an order. These offerings to customers are what can make a restaurant brand stand apart from their competitors when it comes to consumer choice.
Interested in more ways you can minimize the impact of COVID-19? Read our recent blog post for more best practices and tips for driving revenue to your restaurant.
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