Using CRM for Restaurants to Increase Customer Retention

It’s a busy night in your restaurant -all the tables are booked and more customers are lined up while waiters are occupied serving meals and clearing tables. The kitchen is firing on all cylinders. Managers are working the floor making sure things are running smoothly. At the end of the night, the coffers have been nicely filled, waitrons have earned great tips and happy satisfied customers have strolled out the door. It was a good night for business.

But, how do you keep the momentum going and have more profitable nights like this with a constant stream of customers? How do you ensure those satisfied customers eat at your restaurant regularly?

Using CRM for Restaurants to Increase Customer Retention
Clear understanding of customer expectations
Let’s face it, the restaurant industry is tough. There is some debate on the statistics, but, it is estimated that between 60 – 80% of new restaurants fail within the first year. Around 70% of those that make it past the first year are likely to close their doors within the next three to five years. These are scary statistics for restaurant owners. For those that do last, life is still not easy - competition is around every corner. Customers are spoilt for choice. How do you get a leg up to help you stand out above the crowd that are all clambering to get their feet through the door?

Relationship building is key, it can make the difference between a one-time customer and those that return on a regular basis. These days there are plenty of CRM solutions out there that cater specifically to the restaurant industry and have changed the game significantly in this highly competitive arena.

5 ways a restaurant's CRM initiative can turnaround customer churn:
1. Build a customer database 
The first thing a CRM system does is gather information and help the restaurant owner get to know their customer.

1. Customer contact details
2. Frequency of visits
3. Preferences on meals
4. Average spend per visit


When linked to the restaurant’s point of sale software, it can provide valuable reports and analysis on:

1. Most popular menu items
2. Items that are not selling
3. Busiest days/ nights and help identify the reasons why
4. If it is a nationally franchised or chain of restaurants, it can provide the franchisor with information on which regions are performing better than others.

This becomes the basis for communication with the customer, helps track customer trends and feeds into marketing plans.

2. Menu engineering
At the heart of a successful restaurant is its food, the options available on the menu too should match customers' tastes and preferences and its quality should be superior.That’s pretty obvious, isn’t it?

However, even if food is good quality, every restaurant has meals that sell phenomenally well and those that don’t. The restaurateur needs to be clued up on this in order to be more profitable. A Cloud CRM Software which is linked to the point of sale software and any other system will generate sales information on the menu products in four ways:

1. Popular and highly profitable items
2. Profitable but unpopular items
3. Popular but unprofitable items
4. Unpopular and unprofitable items

The first and last points are a no-brainer. Popular and highly profitable items should remain on the menu – don’t fix what’s not broke. Unpopular and unprofitable items need to be scrapped from the menu. The challenge is in finding creative ways to improve the two in the middle. For popular but unprofitable items, this could mean substituting one or two ingredients with a cheaper alternative without compromising quality and taste. For profitable but unpopular items, more aggressive marketing may increase sales or tweaking the recipe could make it more appealing.

This type of information can also lead to product innovation. Assessing the type of meals that are popular can lead to designing new menu products.

3. Strategic marketing campaigns

So, you now have a CRM system in place and you’ve gathered information about the customer and scrutinized the menu. What’s next? Marketing is the next logical step. Armed with the insights your CRM solution provides, you can start developing strategic promotional campaigns. In addition, CRM enables you to segment and target specific groups of customers such as seniors, adults, students and kids.

You can identify quiet days/ nights and run a special to help attract customers. With the help of your CRM software you can communicate directly with the customer via email or text message.

Don’t only offer discounts, but look at adding value to the customer. For example, offer a free dessert one night of the week or run an in-store competition. Send a coupon or voucher via text message that the customer can redeem on their next visit. Promote a theme evening with small giveaways and freebies. Competitions and theme evenings create a vibe and are a lot of fun. This makes your restaurant not only a place to eat at, but a place to enjoy an experience! Why do kids love going out to eat? Because it’s more than just a Happy Meal, it’s a fun adventure.

4. Loyalty programs

Following on from point 3, loyalty programs use the data that has been collected and take marketing one step further. What does CRM stand for – customer relationship management. Loyalty and reward programs are what CRM is made for.

Loyalty programs can track the frequency of a customer’s visits using big data, their meal preferences, what time of the week or month they tend to visit, their average spend per visit as well as their total spend since being a member of the loyalty program. These provide the optimum platform to interact and engage with the customer. Special individual offers can be targeted for customers on the loyalty programme. Reward loyal customers with a free gift, send a birthday wish and offer a discount. Keep in regular touch with customers via email or text message. This makes the customer feel special and they love that they get something out of the deal!

5. Customer retention

What is the ultimate goal? To make the customer’s experience with your restaurant a unique one that keeps them coming back! In addition to all the advantages a CRM solution gives you mentioned above, it will also provide a couple of other useful functions to promote a positive relationship with the customer.

1. Customer feedback and suggestions: Rather than just a one-sided conversation, i.e. the restaurant communicating with the customer, this is a tool for the customer to speak to the restaurant.
2. Customer complaints: Don’t lose a customer over a badly handled complaint, most people are quick to spread the word about bad service to at least 10 or more other people.

Be quick to respond while they are still in the restaurant, and use the Cloud CRM Software to follow up in a few days or to send a voucher/coupon, for example, which invites them back. Dealing promptly and efficiently with a dissatisfied customer usually calms them down and will make the difference in losing that customer forever or having them give your establishment another chance. When they do come back though – make sure the problem does not occur again!

So, up your artillery in the battle of the restaurants and invest in a future-proof CRM software to ensure enhanced customer experience. The long-term benefits will be well worth the investment and ensure better word-of-mouth advocacy.



2 comments:

  1. Hi Deevra, sound good. The real problem is how to get customers information and how to track their behaviors. How does your solution address those problems.

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    Replies
    1. It's hard to collect customer information for traditional restaurants, unless you offer some mechanism to get that information, thus the value of online ordering. Loyalty programs work great, but chances are the customer is already an existing customer. Online ordering fills in the gaps, and can provide you a mechanism to collect customer info. You most likely need at least an email address or phone, or probably both to order online. Therefore you can now collect customer information and begin to analyze the transaction. Http://ez-chow.com can help with implementing pos integrated online ordering, allowing restaurants to take the next step in growing their customer base and ultimately their profitability.

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