Ever wonder if you can simultaneously increase the restaurant profit margin and customer retention? Well, it turns out you can!
Over the last several years, the restaurant industry has been combining some stellar features with innovative restaurant technology. As we have seen repeatedly, loyalty and rewards programs are just a couple of them.
Before learning about why a restaurant loyalty program is a great solution, let’s discuss the basics.
Customer Rewards Program: Definition
A customer rewards program is a system where people can receive rewards based on spending habits. In many cases, it’s in the form of a point system. So, every purchase would equal one single point. After so many, customers can earn different perks.
Customer Rewards Program Software
One of the best features of customer rewards program software is that they often integrate with the restaurant POS platform. When a POS system integrates with other types of restaurant tech, it helps to streamline restaurant operations.
10 Reasons to Create A Customer Rewards Program
There are so many reasons to create a customer rewards program. However, we’ve narrowed it down to a top ten list. Keep reading to learn more.
1. Increases Revenue
From a general perspective, experts will tell you that customer rewards programs are effective solutions for boosting the ROI of an eatery. The ROI meaning refers to the amount of money that a business generates based on its investments.
There are numerous reasons to implement a customer rewards program. However, it’s safe to say that they all revolve around revenue goals. From customer retention to marketing assets, there are many ways to make a rewards program work for your business.
2. Attract New Customers
Everybody loves a freebie or discount. In fact, they can allure customers to a new eatery.
There are probably people who know about your restaurant but may never have had an incentive to visit. Launching a rewards program might just do the trick to get people to stop by.
Research local competitors and find what they do and do not offer customers. Use this information to develop product differentiation with customer rewards that’ll work for your restaurant.
3. Retain Existing Customers
A customer rewards program can create a domino effect. The more people dine at your restaurant, the more rewards they’ll receive. And the closer they get to a perk, the greater the incentive will be to return.
If someone is debating between your eatery and another, but they can redeem a free dish, they’ll likely choose yours. Or, if somebody is just a point or two away from a freebie, they can sway toward the business offering perks.
In any business, customer retention strategies are vital. It’s what will ensure loyal customers who keep the eatery profitable. Plus, it’s a way to avoid slow seasons.
4. Access to Customer Data
Upon signing up for a customer rewards program, people will have to provide certain information. Such data points can include email addresses, phone numbers, and home addresses.
This information can be beneficial for outreach, such as an email marketing strategy or SMS alerts. In doing so, customers will engage more with the brand. And once this happens, there will be much more insight at your fingertips.
5. Offer Exclusive Perks
Creating a sense of exclusivity is ideal for enticing people to visit your eatery. Restaurant managers can implement this tactic by offering certain perks to members only.
By offering great perks to reward members, other customers won’t want to miss out. Before you know it, more and more people will sign up to become members.
6. Enhance Customer Satisfaction
Elevating the customer experience is ideal for retention and sales. It’s no secret that people enjoy perks, so a rewards program can quickly make your business a fan favorite.
Sometimes, customers might not even expect a reward. In these cases, it’ll be a pleasant surprise when they receive a free dish or a discount on the bill.
With this idea in mind, it’s even more important to utilize customer rewards program software. Using automation to track such data will benefit both the customers and wait staff.
7. It’s A Marketable Selling Point
A customer rewards program is a great product to promote online. Plus, you might notice that constantly posting content about menu items can be redundant.
Content that features information about perks and discounts can easily generate awareness. Consumers are often drawn to freebies, so it’ll make for interesting posts and graphics.
If you’re serious about promoting major selling points on social media, learn how to calculate the social media ROI. This metric will determine if online efforts make a difference. Restaurants can also promote their rewards program on their website, in print ads, and via restaurant SEO tactics.
8. Offer A Built-In Referral Program
Why not reward current members for getting their friends and family to join the fun? Referral programs are effective strategies to generate more sign-ups.
Allow customers to receive the ultimate reward when someone uses their referral code. This perk could be a large number of points, a free dish, or even a major discount on the bill.
You want to make sure that the rewards you offer don’t impact the profitability of the business. However, you do want to ensure that referral rewards are the most exclusive perks. After all, they’ll help grow the entire customer base.
9. It Encourages Positive Reviews
Word-of-mouth marketing is one of the most effective forms of restaurant promotions. Naturally, people put a lot of trust in what their peers and the public have to say.
As customers experience the benefits of being a rewards member at your restaurant, they’re bound to talk about it. Plus, you can go the extra mile by offering “bonus” rewards for members who leave customer reviews.
As you collect positive reviews, they’ll serve as passive marketing assets. Just be sure to always deliver the best customer service to keep up with the feedback.
10. It Cuts Costs Over Time
Customer acquisition is expensive, even for restaurants. By having a program that provokes customers to keep returning, you’re lessening costs over time.
It also helps to attract new customers more than any other marketing tactic. Plus, once they sign up for rewards, the domino effect of redeeming perks will continue.
Frequenting Asked Questions About Creating A Customer Rewards Program
Customer rewards programs entail many benefits. Keep reading to learn more about the basics and impact they have on all types of businesses.
How Do You Set Up A Rewards Program For Customers?
First, determine the rules and perks for your rewards program. The next step would be integrating the appropriate features, inputs, and app integrations into your POS system. Then, you should be able to track and redeem points as customers add their information.
What Are Examples of Loyalty Programs?
An example of a loyalty program would be if a customer receives one point after every meal. Then, after ten points, they can receive 10% off their bill. Or, they can redeem their points for a free item from the dessert menu or a list of drink specials. Regardless of what you offer, loyalty programs should always include a tally system and perks.
What Makes A Good Rewards Program?
Exclusive and valuable rewards are what make a great rewards program. Businesses need to offer customers something to feel excited about. So, it’s vital that perks are sought-after.
Why Are Customer Rewards Programs Important?
Customer rewards programs are important because they incentivize people to visit and return to your business. These factors are key for customer retention and maintaining high profits.
How Can A Customer Rewards Program Be Improved?
A customer rewards program can be improved by listening to what customers have to say. Simply ask customers on social media or conduct surveys to find out what people would like to receive from their membership.
It may be a surprise to see how simple the changes need to be. You can make major improvements by letting customers voice their thoughts.