How Loyalty Schemes Can Increase Your Profits

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Chef & Young, How to increase your restaurant profits
Have you noticed the increased popularity in loyalty schemes? Some businesses have had loyalty rewards for years (think BA Avios points, Nectar cards, Boots cards, café’s with buy 10 get your 11th free) but what drives these schemes and why has the restaurant industry not yet jumped on the loyalty-bandwagon?

Research has shown that a fully engaged customer represents an average of 23% higher profitability, revenue, and relationship growth compared with a “regular” customer.

For the restaurant industry, a fully engaged guest makes 56% more visits per month than actively disengaged guests do. So we all want loyal and repeating guests but how do we keep them returning for more?

The question is how you get your guests engaged in an increasingly saturated market and with greater consumer sophistication (and choice of where to take their hard-earned money).

Delivering great product, service and environment is fundamental in delivering meaningful experiences but it is also crucial to connect with your guests on a more emotional level. This is how you do it:


  1. Implement a guest loyalty program to reward your best guests so they feel appreciated and can see a higher value perception from your competitors. Majority of customers spend more after joining a loyalty program so develop a wide range of opportunities where the guests can gain points and rewards and the higher engagement you will see. E.g. can you offer guests on the scheme the ability to use a few tables in the restaurant as working spaces for the less busy hours of the day? Perhaps get every 3rd coffee for free? Exclusive deals and discounts for members of your loyalty programme.


  1. Engage with your local community. Create loyalty discounts and offers in partnership with other businesses in your area to drive more business for the entire community. There are many loyalty schemes that span several businesses that independent restaurants can take advantage of to get a wider audience (Gourmet Society , Quandoo, and Swipii to name a few). These schemes only survive if more and more businesses make use of them, so be smart in selecting the ones to work with – ensuring their audience is your target market and that the pool of potential customers is large enough. Next, make sure that your offer is attractive enough to bring in these customers who are more likely to spend their money than a “regular” person.


  1. Initiate mobile ordering, payments and communication channels to ensure easy access to your brand. The easier it is to speak and interact with a brand the more likely guests will continue to come back. Implement instant messaging as it is the preferred communication channel by a growing amount of people and reduces the barriers for guests to get in touch. Millennials and Generation Y (people born in the 80’s and 90’s) want the ability to buy online and are also keen to book restaurants, hotel rooms and more via their smartphones so you should ensure to have an integrated mobile payment solution.


  1. Consistently measure and track your guest engagement. By doing this you can develop the right data based interventions to be able to optimize the guest relationships and gain the benefits of higher sales, profitability and growth.
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