Did you know that it costs five times more to acquire customers than it does to retain existing customers? If you’ve been focusing all of your marketing efforts on seeking new customers, consider also dedicating resources to restaurant customer retention strategies.
After all, regulars aren’t just familiar faces; they’re also your best customers. Loyal customers spend more money than other guests and tell others about their favorite restaurants.
Sure, social media is one of the most popular strategies for staying top of mind, but it’s not necessarily the most effective for getting diners to keep coming back. This guide to retention marketing will cover tactics that go beyond social media. You’ll learn:
- Exactly what retention marketing is
- Why restaurant customer retention is so important
- Six customer retention strategies to try at your restaurant
What is retention marketing?
Retention marketing refers to marketing efforts aimed at keeping existing customers coming back, rather than attracting new customers.
For example, while handing out samples of your pastry chef’s best desserts on the street is a good way to attract new customers, sending existing customers incentives for their next online order is an example of a restaurant customer retention strategy.
Why is retention marketing important for restaurants?
Retention marketing is critical for restaurants because consistent, repeat customers sustain the industry. Why?
First, loyal guests spend more than occasional customers. According to findings by the Harvard Business Review, a 5 percent increase in customer retention can increase profits by as much as 95 percent.
Second, loyal restaurant customers serve as your word-of-mouth marketing street team. A study by Bain found that repeat guests will tell three people about a business they like.
Finally, as we already noted, it’s easier – and five times cheaper – to retain consumers than it is to attract new ones.
The top 6 restaurant customer retention strategies
Use as many of these customer retention strategies as possible to maximize results.
1. Use data to your advantage
Customer data is the key to successful retention marketing. The more you know about your customers – like their order history, dietary preferences and birthday – the better you can target your marketing efforts.
Look for a platform that lets you own your customer data and use it. Find restaurant management software that comes with both a CRM and marketing automation software. That combination will let you collect guest information from reservations, online orders, on-premises dining and use it to inform automated, yet highly personalized, marketing messages.
2. Personalize your marketing efforts
Marketing to the masses is no longer the most effective customer retention strategy, for the restaurant or any other industry. Customers want to feel like one in a million, not like just another member of your mailing list.
Personalizing your marketing efforts will make guests feel special, help you send the right special offer at the right time, and make guests more likely to return. By personalization, we don’t mean just using the customer’s name in a marketing message. We mean understanding what they like and want and anticipating their needs.
Personalization means contacting a customer before their anniversary to offer a free glass of champagne if they celebrate at your restaurant, or offering their favorite dessert on the house to celebrate their birthday. It also means thanking a guest for visiting for the first time and inviting them to dine with you again or to place an online order. Marketing automation software that integrates with your CRM can help you execute this flawlessly and automatically.
3. Stay top of mind
Nurture your relationship with existing customers to keep them coming back.
While having an active social media presence is one way to do this, it’s far from perfect. You still have to convince people to follow your social media accounts and hope that the algorithm works in your favor so that your followers see your posts.
Email marketing is a more effective restaurant customer retention strategy because there’s no algorithm standing between you and the recipient. If you have the right email address, your guest will receive the email.
Stay top of mind by sending “we miss you” emails to diners you haven’t seen in a while. You can even offer small discounts or value adds (like complimentary appetizers or dessert) to provide an extra incentive for them to visit you again.
When California-based Tartine Bakery started emailing its customers coupon codes via SevenRooms’ marketing automation tools, they not only surprised and delighted their customers, but also saw an increase in sales. The bakery generated $123,000 in incremental revenue in its first two months of using this marketing tool, accounting for nearly 4,000 additional orders.
Marketing automation software makes staying top of mind a piece of cake. With SevenRooms you can start with pre-made email templates, or create your own, and use them to send customers reminder emails at intervals that make the most sense for your business (i.e., three weeks after a visit, or one month after an online order).
4. Keep customers engaged
Another way to keep diners coming back is to encourage them to engage with your restaurant after a meal. Email feedback surveys after every visit or order to stay on consumers’ radars and gain valuable information, without being intrusive.
The survey could be as simple as asking guests to provide a star rating out of five for their overall experience.
Marketing automation software simplifies both sending and responding to surveys. Diners will automatically receive a survey in their inbox after a meal, and will receive automated responses depending on the rating they give. Automated responses buy your restaurant staff time to follow up with a more personalized response, when needed.
5. Recover customers
Monitoring and responding to feedback from unhappy customers is another restaurant retention marketing tactic. It’s an opportunity to make things right, wow customers, and turn them into regulars and promoters.
Beyond just reviewing direct feedback surveys, you should also monitor customer feedback on review sites like Yelp, TripAdvisor, and Google.
A study by Harvard Business School found that just a one-star increase in a Yelp rating could increase an independent restaurant’s revenue by between 5 and 9 percent. One of the most effective strategies for increasing your Yelp rating, and retaining customers, is to respond to these reviews. ZenBusiness found that nearly one third of customers reversed negative reviews on public review sites after receiving a response from the business.
A review aggregator makes keeping track of and responding to public feedback easy by curating reviews from every major review site into one dashboard and sending you a daily email with the highlights.
6. Incentivize loyalty
Implement a customer loyalty program to incentivize and gamify repeat business. Think of a loyalty program as a digital punch card: the basic principle is that customers collect points every time they make a purchase. When loyalty program members earn enough points, they can redeem them for discounted or free food, merchandise or exclusive experiences.
Fortunately, you don’t have to learn how to code to build a digital loyalty program for your restaurant. There are many available on the market. We recommend choosing a loyalty program that is made specifically for restaurants and integrates with the rest of your tech stack, so you can have as much data as possible about your customers to inform the rest of your retention marketing efforts.
The bottom line: Retaining customers will sustain your restaurant
While you may have become a restaurateur to create memorable dining experiences for guests, you also need to focus on marketing. We’re talking about much more than just posting updates to social media. Attracting repeat customers will keep your restaurant in business.
Hospitality and marketing have more in common than you might think. They’re both about paying attention to your guests and making them feel special. When you engage with diners after a meal through feedback and reviews, send them personalized offers they can’t resist, and pay attention to their likes, dislikes and behaviors, you can better serve them.
Need a hand implementing the restaurant customer retention strategies we suggested? SevenRooms has all of the marketing automation, review aggregation, and feedback collection features you need to keep guests coming back for more. Request a demo today.