Opting for a loyalty program is highly crucial for your business. In a market where hundreds and thousands of businesses are competing in the same industry, it often becomes hard for restaurants to attract new customers or retain the old ones.
Although customers are attracted to a unique experience, they are also looking for convenience and discounts somewhere down the line. If there’s a restaurant that’s offering them long-term benefits, then they will be more obliged to purchase from them rather than eating at a whole different restaurant.
In this post, you will learn about loyalty programs, how they function, and, more importantly, how restaurants can benefit from them. Keep reading to take your business to the next level.
Loyalty Program – What Is It?
As suggested by the name of it, it’s a form of reward-based marketing strategy to gain customers’ loyalty towards the brand.
It is human psychology to be attracted to rewards, and businesses using this trick can gain more profits and customers. This strategy is focused on retaining customers, attracting new ones, making customers purchase, and increasing brand engagement.
Using a rewards/loyalty program saves you from spending thousands on the marketing budget yet still getting excellent benefits over it.
How Does a Loyalty Program Help?
From small to big businesses, everyone can benefit from a loyalty program. Customer loyalty means more sales, which is all a brand needs in the long run. So, if you’re ready to implement a loyalty program at your restaurant, then here is how you can benefit from it.
Ensures Customer Retention
Not to brag, but retaining customers should be more important than attracting new ones. Your old customers are the living advocates that can help you gain more customers if they are treated right. With the help of a customer loyalty program, you can gain loyal customers that will help you grow your business in the future.
Loyalty programs aid in keeping the marketing costs low and driving more profits and as per an estimate, retaining an old customer costs 5x less than attracting the new one. So, make your call!
Gathers Data to Make Data-Driven Decisions
Loyalty program saves customer data that can be used by businesses to improve their services. Restaurants can track sales, gather customer information, check retention rates, and much more using this one platform.
Once you have identified the problem, you can use this information to reshape your marketing strategies and create a more targeted approach. You can gather information regarding customers’ preferences that can help you provide them with a customized experience at your facility.
Don’t make assumptions, but make data-driven smart decisions to offer a personalized customer experience. Put customer loyalty programs in action to improve your business strategy.
Helps in Sending Out Targeted Promotions
A lot of businesses waste their marketing budget on targeting the wrong customer group. It’s important to segment promotions according to different customer groups for excellent conversions.
Here’s an example. You can target luxurious products to high-spenders and create a separate email list for time-sensitive deals. Sending tailored promotions saves you from wasting your time and money on the wrong items. The more you target them with what they are looking for, the more are the chances that they will become your loyal customer.
With a loyalty program in place, you no longer have to do it manually as the program does it. A loyalty program is a perfect software to help small businesses get an edge over their competition.
Different Types of Loyalty Programs – How to Make the Best Use of It
Expensive, but it works like a charm.
A rebate or a cashback program is the one where the customers are given back a percentage of their spending after reaching a dollar or time limit.
Most restaurants and businesses opt for this type of loyalty program to attract customers. Although it’s effective, it still does not offer instant gratification. Such programs are also termed as ‘refund programs.’
Companies usually return the amount through a credit card or check. Usually, only the most loyal customers benefit from this type of reward program.
It helps businesses get more sales and build a strong consumer base. If you’re new in the restaurant business, it might be a little expensive for you, but trying won’t hurt!
Another type of rewards program is the frequency program. You might have heard the ‘Buy 3, get one free’ type of deals at a restaurant. Restaurants need to have paper punch cards to check if the orders are marked correctly to implement this program.
Although it’s a good way to get customers to purchase more from you, often people still won’t buy if they don’t need it. It’s a low-cost rewards program but does not promise any success in the future.
Also, using this program, you can’t track customers’ information, which is crucial here. It also comes with a risk of fraud, so it’s better to opt for tricks that have less risk and more profit.
In this type of rewards program, customers are given points on their purchases. It’s one of the most common rewards programs. Once customers have enough points in their account, they can use it to get cashback, freebies, perks, and other gifts as well.
Restaurants can also give points to customers for posting about them on social media or by leaving reviews on their pages. In short, you’re not only gaining a customer but also getting free marketing as well.
It’s one of the most common and easily understandable rewards programs where customers are given a discount on the product’s original price. It’s implemented all around the world, and businesses make excellent profits out of it as well.
It further gives an impression to customers that your products are over-priced or probably yours is a luxurious brand. If you’re new to the market, you can offer a discount to attract customers or make use of special days to give discounts to people.
Your customers might not be interested in monetary rewards only. There’s more to life than saving money, so another best idea is to implement non-monetary rewards. You can send notifications or emails to your customer telling them about the latest services or upcoming products.
You can offer them special birthday rewards, incentives for posting about them on social media or encourage them to donate to a charity of their choice.
All of it helps you in gaining customers’ loyalty. Whether you’re a small business or a big one, anyone can implement this program to gain benefits from it.
It’s another type of loyalty program to encourage customers to dine in with you or order products online. You can offer customers a voucher with an expiration date that can motivate them to order while they have time.
It’s a good type of surprise promotion. You can also give your customers a voucher for birthdays since most people dine out on their special days. You will have a great chance of creating a regular customer at your restaurant.
Should Restaurants Get a Loyalty Software?
According to reports, about 83% of customers said they are more likely to do business with companies offering loyalty programs. Loyalty programs offer instant profits and promise the future success of the restaurant. If you’re new to the industry, the best way to gain customers is to prioritize value over everything else.
If you’re to put a few loyalty/rewards programs in place, then make sure they add value to your customer’s life. It helps in customer retention and sends out a positive brand image that is hard to maintain in a competitive industry.
If you’re looking for the best CRM for restaurants that come with loyalty programs, then there’s nothing better than MenuCRM. This loyalty software for restaurants is designed specifically to assist small businesses in gaining profits.
Finding the right customer retention strategies for restaurants is a tough job, but with this software, you don’t have to worry about it. The software gathers all customer information that can be used to improve the business strategy. The data can be used to send targeted promotions to customers to get their attention.
It’s one software that does everything for you, so you don’t have to do the leg work or hire more staff members. Use the rewards program for small businesses to get more customers in no time.
The software is designed by a restaurant, covering everything that new businesses are looking for. We conducted more than 1000 interviews of restaurant owners before assembling it, hence, the software everything that you’re in search of.
Try out our customized free demo trial on the website platform to see if the software is according to your business needs or not. You can also get in touch with us to discuss your restaurant’s needs in detail.