Cheers, where everybody knows your name. Iconic American sitcom from the 1980s, set in a bar called Cheers, where a core group of patrons are as loyal as they get.
Although the world has changed significantly since the 80s, personal service remains one of the cornerstones of keeping your customers coming back to dine in your restaurant, time and time again.
IBISWorld reports that there are 22,993 restaurants in Australia, with revenue expected to grow at an annualised 2% from 2014-2019 to reach $18.8 billion. Busy lifestyles and reduced leisure time have increasingly led consumers to dine at restaurants, allowing them to combine dining with leisure and to avoid spending time on food preparation. Consumer demand for quality food and dining experiences has fuelled revenue growth.
The report further revealed that the industry is highly fragmented and dominated by small, individual businesses; characterised by a low level of market share concentration, with no player accounting for more than 5% of revenue in 2018-19. Barriers to entry are low which makes it easy for new restaurants to open, which together with the low level of market share concentration spells fierce competition among operators. Restaurants typically compete based on price, menu offerings and customer service.
Given the competitive landscape, the fight to get customers through the door is raging on, and with so many choices on the table, keeping customers loyal to your restaurant is all the more challenging.
It has been reported that it costs five times more to acquire a new customer, than to retain an existing one. Keeping your existing customers happy and coming back costs you much less and you have the added benefit of their positive word of mouth. It has also been found that returning customers spend more in a restaurant than new customers, which highlights the importance of a customer’s lifetime value, rather than just a single transaction.
The question is, how do you keep your customers coming back for more?
You have one chance, and one chance only to make a positive impression on a new customer. Their experience begins even before they set foot through the door, starting with how they decided to dine at your restaurant. It may have been word of mouth, advertising, social media or your website, so making sure your brand is professionally and consistently presented across all channels will make a good impression.
Look at each touch point and make sure it’s the best you can offer – parking, greeting on entry, seating at their table, server taking their order, time taken for food to arrive, washroom cleanliness and bill preparation to name but a few. If you map out each aspect as if you were a customer yourself, it will help you to identity and maximise every opportunity to wow your customer.
How you serve your customers is just as important, if not even more important than the quality of the food you serve. With so many options to choose from, how you make your customers feel from the moment they walk in to the moment they walk out, has the potential to make you stand out head and shoulders above the competition. Your customer should feel valued and respected each step of the way, your servers should be friendly and efficient, and food should be served within a reasonable amount of time after placing an order.
When a customer finds a favourite dish, it should be consistently as good as the first time they ordered it. This can be challenging to achieve with different chefs on shift and seasonal changes in ingredients, but it’s worth putting effort into. This also applies to levels of customer service, which requires all your staff to be trained to the same standards and thereafter monitored to ensure those standards are upheld. Knowing what they are going to get is one of the many reasons a customer remains loyal.
Implementing a rewards or loyalty program will provide additional incentives for customers to return, as well as give you the valuable opportunity to gather data about your customers’ preferences. Sending your customer a complimentary dining voucher for their birthday may encourage them to bring family and friends along to celebrate the special occasion, resulting in a bigger bill and also exposing your restaurant to potential new customers.
If you have a loyalty program in place you will be able to gather data about your customers which will give you insights into how to better serve them. Information about dining preferences, habits and patterns could be used to personalise offers, tailor your marketing and to make improvements to your business.
Regular communication with your customers will keep your restaurant top of mind, assuming they have opted in to receive it. You can keep customers informed about special offers, new developments and relevant news, using channels such as email marketing, social media, mobile apps or loyalty programs.
As you focus on keeping your customers happy, you will reap the rewards of their repeat business, along with the added bonus of their positive word of mouth.
You invest so much time, money and effort in your business, so we want to make sure your restaurant is protected. Ryno Insurance will work with you to customise insurance cover for your one-of-a-kind restaurant.