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Food for Thought

New ideas and advice to help you improve the operation, turnover, and connectivity of your dining sites.

Core Customers: five ways to leverage technology to improve hospitality loyalty schemes

March 9 2017, by David Charlton

"Tailoring is important. The point is to fill empty tables, not reduce revenue from the full ones."

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We’re all familiar with the traditional loyalty card model: you shop, you swipe, you accumulate enough points and then you can spend the points on something you want. Unfortunately for hospitality businesses, what works for the weekly shop isn’t so immediate or clear cut when your customers are diners.

The difference in hospitality is when it comes to driving customer loyalty, it’s all about the E-word: experience.

Consumers don’t generally see dining as mere fuel; it’s about the overall experience from checking out an app or website to leaving with a smile on their face. And the more personal you can make that experience, the wider the smile.

We’ve got the numbers to prove it. In a 2016 survey by Go Technology, personalisation was the fourth most important factor in choosing an independent restaurant; location, quality and style were first to third respectively. That preference was across all groups from early adopters to mainstream customers, all of whom rated it as more important than value for money, authenticity or the availability of healthy options.

Game on

One way to personalise the loyalty scheme is to bring in gamification - that is, to reward customer behaviour in exactly the same way a videogame might do. If you’ve ever tried to tear a child away from Pokémon Go you’ll know how addictive such games can be.

By making a loyalty scheme fun, you can reap big rewards: for example, if you offer  rewards for a mix of behaviours including consuming content, shopping, posting to social media and creating content you can keep your customers involved and in the case of social media, even get them to help market your business.

The trick is to come up with rewards that are worth investing the effort for: if it’s just a few percent off the next purchase that doesn’t really stir the soul. The best gamification offers instant positive feedback, the ability to lord it over peers or friends, and rewards worth collecting points for. Just be careful with any social media element, as if it’s possible for well-intentioned hashtags to go wrong and do damage to a brand, it’s almost certain that they will.

Get your engine running

One of the simplest ways to personalise the customer experience is to offer tailored recommendations or offers. That enables you to offer things the customer will value, such as money off their favourite items or a fantastic deal on something they’ll appreciate. It’s important that the customer feels that the offer is specific to them, whether that’s in the form of an email sent to them during a quiet period offering a great discount or a brand new menu, or an offer in the app when they’re actually in the restaurant, and it’s also important to monitor the effectiveness of such offers to ensure you’re getting the return on investment you’re hoping to achieve.

Tailoring is important because you don’t want to offer discounts to people who’d be visiting your restaurant anyway. The intention is to fill empty tables, not to reduce the revenue from the full ones.  

Make everything easier

Speed of service is a common complaint among restaurant users, and that’s something your loyalty programme can help with too - especially if you’re using an app-based system for customers’ smartphones. Brands are increasingly using their apps to do much more than just show the menu or detail the specials; they’re enabling customers to pre-order their meal before they even arrive or when they’re seated, and to pay for their meal without having to wait for a member of staff. This is particularly appealing to younger customers, who appreciate yet more uses for their smartphone. Over-55s are less enthusiastic, preferring to deal with people rather than pixels.

Sell more stuff

If your app is offering ordering, payment or both, that’s an excellent opportunity to bring in your loyalty scheme. By placing tailored recommendations right there in the app at the moment of ordering, or the moment when diners ask one another “have we finished or should we look at the dessert menu?” and see a tempting discount, you can easily increase the initial order or keep the customer at the table for a little longer.

Offer something for nothing

One excellent way to capture loyalty-related data without a formal loyalty scheme is to offer free internet in-house, subject to a few very simple conditions: an email address and postcode, perhaps, or some other simple bit of data. That data enables you to develop a picture of the customer on subsequent visits, and it also enables you to deliver time-sensitive marketing messages: most such wi-fi systems have a branded homepage that the customer sees before they can get online completely. Tailoring offers by combining the time of day with other factors, such as targeted discounting or time-limited special offers, can be an excellent way of maximising your per-cover revenues without appearing to have a formal loyalty scheme at all.

Points to remember:

  • The trick is to fill empty tables, not to discount ones you'd normally fill anyway
  • Gamification - offering rewards for a mix of activities -  can make loyalty schemes feel fun and exciting
  • The best gamification offers instant gratification and something worth saving up points for
  • Apps make it easy to cross-sell, up-sell and offer personalised deals.
  • Customers aged 55+ prefer people to pixels

Primed for Change? Find out more.

Topics: Industry Research