The Basics of Building and Maintaining a Loyalty Program

Customer retention experts say that there is a 70% chance that customers engaged with a loyalty program will make a repeat visit to a business. This is particularly important for the restaurant industry as they are heavily dependent on repeat visits by loyal customers. Experts say that the restaurants should focus on setting up loyalty programs to keep bringing the customers back.

Small businesses are always competing with big brands for business and therefore, it is important for small businesses to build their loyalty programs so that the customers keep coming back. Restaurants are already good at communication and therefore it is comparatively easy to build a loyalty program. Even if the word of mouth for a restaurant is strong, a loyalty program is one extra reason for the customer to come back and it changes the table turnover rate as well as the average ticket size.

The restaurants which have set up such a loyalty program have seen a meaningful increase in repeat business from loyalty customers.  Everybody enjoys freebies and everybody enjoys free food even more. In case of restaurants, the most popular items on the menu make for an enticing reward.

Restaurants should focus on offering an item which can be given away quickly. It can also be coupons or a bag of goodies. Ideally restaurants should offer a reward when a customer makes their third visit. It can be anything such as a free coffee, desert, drink or appetizer. Restaurants should up the ante on the next few visits and the reward can go up to a free entree or something of similar value.

The most important aspect of a successful loyalty program is staff training. It is important for the staff to be trained to promote the loyalty program.  Without adequate staff training, the loyalty program is not going to have a chance to be successful. Once the staff has been completely trained, the data provided by the loyalty system can be used to track each customer. This data supplied by the loyalty system also helps in taking marketing decisions such as whether to focus on retaining existing customers or whether to focus on acquiring new customers.

The most important metric for making an investment is the return on investment and in the case of loyalty programs; the return on investment is always high if implemented properly.