How Your Restaurant Loyalty Program Impacts Revenues During a Shutdown
Although the signs of a post-pandemic recovery were promising over the summer, sparks of uncertainty are returning. Headline news of possible supply chain collapses, slower vaccination rates, and rising case numbers have some restaurant owners wondering if there are more shutdowns ahead. Recent trends show that diners are still erring on the side of caution, often choosing to eat in places with outdoor spaces or ordering takeout or delivery for off-premises dining.
According to data provided by OpenTable, 62% of customers prefer delivery, a 10% rise from the pre-pandemic rates, and this upward trend is expected to continue through 2023. Most restaurant sales come from repeat customers, so building these relationships is important, especially during a pandemic. A restaurant loyalty program can engage diners, encourage repeat business and ultimately increase your market share.
The Basics of a Restaurant Loyalty Program
Loyalty programs can operate in different ways, but every restaurant loyalty program can help increase market share. Here are a few types to consider to help you meet your specific business goals:
- Rewards based on the number of visits: One of the best programs for quick service restaurants is one that offers rewards based on purchases. A local bagel shop may offer “buy ten iced coffees, get one free” or “buy ten bagel sandwiches, get one free.” This loyalty rewards program encourages repeat business but is most effective when eligible purchases are roughly the same price or value. A customer whose repeat purchases will be rewarded at a certain bagel shop will be more likely to patronize that business over one that doesn’t offer a loyalty program.
- Rewards based on dollars spent: A restaurant loyalty program that rewards a customer based on their spending might give them, for example, a point for every dollar earned. These customer loyalty solutions tend to encourage higher dollar value purchases. Certain days may be promoted as “double point days,” which draw in more sales because customers can earn two points for every $1 spent. For example, Burger King’s loyalty program rewards customers with 10 “crowns” for every $1 spent and offers members perks like the option to upsize their drink or fries. Customers can earn double crowns during their birthday month and redeem the crowns for menu items.
- Tiered program: A tiered loyalty solution rewards people for the amount they spend at a restaurant. Customers start at the lowest level and receives some rewards and incentives, then as they spend more throughout the year, they can advance to higher levels with greater rewards. Tiered programs reward the biggest spenders, who are often your most loyal customers.
The Value of Loyalty Program Data
Although any restaurant loyalty program can help maximize each transaction, it’s not unusual to see restauranteurs missing out on their program’s full potential. When customers sign up for a loyalty program, some data is required, which can be used to learn more about customers’ preferences and purchasing habits. Age, gender, and birthday can help you offer custom rewards that will generate foot traffic.
Additionally, a restaurant loyalty program can be integrated into the POS system to collect important data points. These translate into more meaningful promotions based on the time of day they order, preferred items and which loyalty rewards and promotions are redeemed. This information gives restaurant owners insight into their loyalty program, so they know what’s resonating and what should be changed. In addition, these analytics can be utilized to provide a more personalized level of service and build relationships by sending out promotions people will use.
Build Relationships
Gathering data to engage customers through tailored promotions is one of the easiest ways to generate higher sales and repeat business. Some programs may give gift cards as rewards, which encourages future orders. A restaurant loyalty program can also help restaurant owners develop an emotional connection by supporting charities or causes that coincide with certain times of the year or community needs.
Personal connections can be lost when pandemic-related fears mean fewer in-person diners, but a loyalty rewards program can help your business overcome this. Communicating with people through the program, app, mailer, or email will keep them informed about different coupons and promotions when they call or order online for delivery. In fact, some loyalty software and apps will prompt sales by reminding people they have a reward available or a promotion, then allow them to place an order and pay, using their available incentives.
Reach Out to Focus POS for Advice
If loyalty programs are a mystery to you, Focus POS can help. Focus’s customer loyalty solution for POS is part of the myFocus Cloud Solutions and includes cloud storage, card or cardless accounts, multi-store, promotional coupons, email functionality and text-based marketing. It gives restaurant owners a choice in what type of loyalty program is right for them: points, sales-based, “around the world,” and tiered programs. For more information about how to keep customers engaged throughout the pandemic, please visit https://www.focuspos.com/contact-us/.
