Operations – Loyalty Programs

You should keep a close eye on your most loyal customers and ensure that you are coming up with enticing promotions to keep them coming back. Loyalty programs can do this effectively. They make your customers feel cared about and special. Having a loyalty program encourages direct orders, increases your retention rate, increases overall customer spending and allows you to track customer information used to get them back through the door.

Reasons to Implement A Loyalty Program

Encourages customers to place orders directly
Although third party will often still be used to increase visibility, this discourages them. With third party delivery, you lose the opportunity not only to gain the entire profit from the sale, but also from building relationships with your customers.

Increases customer retention rate
Did you know an extra 5% of customer retention can increase profits by at least 25%, and it costs five times less to keep a current customer than to land a new one. According to the leading CRM software company HubSpot, customer loyalty program members are 75% more likely to make another purchase after getting an incentive.

Referrals from word of mouth
If your customers are impressed with your loyalty program, they will most likely tell their friends and family about it, which is the most trusted form of marketing.

Can help to increase overall spend
Customer loyalty brings higher spending –especially if they are visiting more frequently because of your enticing promotions to get them back in the door.

The ability to track customer data
If you choose a POS system, the right one can capture valuable customer data that can be used to create an effective loyalty program. With this information, you are able to create incentives that are relevant to your top customers.


Where to Begin

Choose a relevant name.

Decide on a reward structure. There are two types: rewarding for the number of visits or rewarding for the dollar amount spent.

Online or offline based? Do you stamp or punch out a physical card or do you have the resources to integrate a POS system to streamline customer data?


The Keys to Successful Implementation

Simplicity   The key to a good loyalty program is to make it simple. Customers that find a program complicated will most likely not follow through.

Awareness   Create a buzz around your new program by using signage or flyers in your restaurant. Take it a step further by using a QR code on your promotional material that brings them directly to the form to sign up.

Track sales correlated to promotions  By tracking sales, you are able to tweak your program as needed

In combination with email marketing tactics  Monthly email blasts can provide an easy and effective way for you to share your newest offerings with customers and ensure that your most loyal customers are always the first to hear about exciting new promotions or limited time offers.


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