Why Boosting Customer Loyalty Is A Restaurants’ Secret Weapon

But inaccurate data is making it impossible for restaurants to cultivate relationships with their customers.

ByTim Glomb,VP of content and data for Cheetah Digital

The coronavirus pandemic has changed how people eat. In particular, the pandemic changed how consumers choose the restaurants they want to dine in.With rising food prices and the overwhelming fear of economic inflation as the world recovers from the pandemic, restaurant owners are concerned about reaching their customers. For those establishments that survived the coronavirus pandemic, even after months of closures and reduced dine-in capacity, the road to recovery looks more daunting in this new world of dining.

Consumers are choosing the restaurants they prefer based upon three key factors, according to our recent research. Restaurant goers want a personalised experience, loyalty-based programs that keep them coming back, and clear communication from brand to consumer.

STUDIES SHOW RESTAURANT-GOERS WANT TO FEEL LIKE “REGULARS”

The study shows that 73% of restaurant-goers want a personalised experience in the form of recommendations.They want to receive offerings or product recommendations based on their past purchases.This requires restaurant brands to understand the unique desires of each consumer.

Are consumers’ expectations reasonable? Think of it this way: the personalised experience, unique offerings, and informed recommendations are all elements a customer would experience if they frequented a local restaurant for decades.The restaurant staff would know them and treat them like family; servers would provide recommendations based on the other meals they’ve consistently ordered and enjoyed—they would be offered the unique benefits of being a “regular.”

Consumers want to feel like they are “regulars” at the restaurants they frequent. Unfortunately, large-scale restaurant brands struggle to offer this experience to their customers—even if those customers regularly visit the restaurant. According to the study, 64% of consumers are willing to pay more to dine at a restaurant they trust. But many restaurants are sorely lacking in the trust department with 24% of consumers saying they are not loyal to a restaurant brand simply because the company did not attempt to cultivate that loyalty.

If restaurants hope to succeed in a post-pandemic world, loyalty is the key.

CULTIVATING LOYALTY THROUGH ZERO-PARTY DATA

The only way restaurants can cultivate loyalty is if they know their customers.This is significantly more challenging for large-scale restaurants that cannot have the face-to-face interactions with their customers that small businesses offer every day.That said, strategic marketing efforts make it possible for restaurant brands to reach customers, make them feel like “regulars”, and cultivate loyalty in the process.

The best news restaurants could hope for in this process is that customers are overwhelmingly favourable to communication from their favourite restaurant brands. In fact, 51% of guests have downloaded a restaurant’s app in order to communicate with the brand more directly. This communication is vital, but it’s more than simple notifications about new items or restaurant information.To make the most of direct communication with consumers, brands need to gather data.

The study also reveals that more than 50% of customers are willing to share their data in exchange for better service.The crucial step for restaurants, then, is that they must gather the right data without violating the consumer’s trust.This is where first-party data is essential. Different from background data gathering (usually called “third-party” data), zero-party data is directly communicated between the consumer and the brand. It’s the difference between introducing yourself directly to learn a stranger’s name, or asking a nearby friend to tell you the stranger’s name.

Zero-party data is essential to cultivating loyalty because it answers the critical question:“What exactly does the customer want?” It helps brands determine the products, services, or recommendations that the customer wants first hand. Zero-party data also makes the customer feel heard because their information is relayed directly to the brand of their own accord.

Restaurant brands must optimise consumer data to make personalised recommendations and offerings based on each customer’s unique preferences. This is how brands will generate loyalty and make their customers feel like “regulars”. Consumers are more willing to spend their money at restaurants they know and trust. Loyalty is the key component of restaurant success in a post-pandemic world.

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