Restaurant Marketing 101 – Loyalty Marketing

Loyalty Marketing For Your Food Business

As promised the first and one of the most important items in my Local Store Marketing guide is customer loyalty programs.

Loyalty programs are any means a business uses to grow sales and customer base through repeat business from existing customers. This can also be used to gain new customers but once they step into your establishment hopefully they become repeat or existing customers.

Start by offering the customer an incentive to use your services rather than your competitor. This incentive must be strong enough to outweigh the convenience of a nearer competitor or even a competitor with a superior or better priced product.

This normally takes the shape of a deal that allows a customer to gain a reduced price, an addition product, or other long term incentive. The trick to any loyalty program is to make that incentive available after several visits to your establishment.

The most successful loyalty program for the restaurant and QSR business in my opinion is the “Buy 10 get one free” or “Buy 5 get one free”, it doesn’t matter what the amount is but it does matter that your profit margins on the program should still be healthy and that any loss for the give-away is more than matched by the increase in sales on a daily basis. This is particularly suitable for coffee shops, bakeries, fast food or any business where the price of the main item is between $1 and $10.

Take a coffee shop for example. Average price for a coffee is about $4 depending upon where you are. Most working people in reasonable sized cities have a coffee at least once a week, some have several a day. The customer walks or drives by many coffee shops on their way to work every morning and many large office buildings have their own coffee shops. So how to you compete with all this choice?

A Loyalty Card.

The best way to handle the mechanics of this program is to get cards printed with your logo and a place for the customer’s name and email address as well as room around the outside to punch 10 holes. You should have a unique hole punch made that is only found at your business. I have had a custom hole punch made for less than $40. Make the design of the hole something to do with your logo or something unusual. Many coffee shops are using a hole punch in the shape of a coffee cup so try to stay away from that design. Be sure to have the place for the customer’s contact details.

The collected information can be used in many ways, emails with new offers or products, contacting them if you haven’t seen them for a while, (you or a team member may have upset them) additional loyalty programs for your best customers; for example a draw of used cards for “Free Coffee For a Week”.

When the customer places an order the server asks if they have a loyalty card. If they don’t they ask if they would like one and explain the offer. The customer orders a coffee and the server punches a hole in the card.

When the customer has all 10 holes punched the server can tell them that their next one is free when they bring back the fully punched card. How you handle it is up to you – it may be that you wish to give them their 10th coffee free. Fully punched cards are then collected and a new one given to the customer.

Note: The cards should be small enough to be carried in a wallet or purse ( business card sized) and if a customer has more than one card with, lets say, 4 holes on one card and 6 on the other, then you must honor the 10 holes. Also if you see a customer with two or three cards, offer to consolidate the number of punches onto a new card and discard the old ones.

The coffee shop idea can be adapted to many different types of businesses and is not exclusively for low ticket average products. I know of higher end restaurants that use it too. Office workers will offer to get coffee for their co workers so they get a free one for their trouble. And I know of more than one boss that buys his/her entire team coffee on a Friday and enjoys his free one with his spouse on the weekend.

Be creative in your local store marketing, look at what your competitors are doing and how they are making their customers more loyal to their business. Adapt ideas that you see, not only from the food industry but from any type of business and get started.

With Back -to-School around the corner, next week I’ll talk about some ways to get your product out in front of the students and kids…

 

Coffee Drinks For Summer-Recipes!!

Its summer and the schools are all out for the holidays and it is time to start thinking about how you can capitalize on the season by adding summer beverages to your menu. They are easy to make, have a high profit factor and can bring a whole new customer base into your business. You can introduce one or two to start with or look at a whole range of new cold beverages.

Coffee can be made several ways as a base for cold beverages, the two best are using shots straight from an espresso machine or cold filtered with a long brew in cold water overnight.

If you already have a blender then the variety of beverages is almost endless. If you don’t have a blender and don’t want to spend the $1500 – $2000 for a top of the range commercial model then check out some of  used equipment websites on the net or if local health and safety laws allow it, head on down to your local Walmart or appliance store and buy a good domestic model. Don’t forget to order spare blades, o-rings and have at least two blenders on hand. One for milk based products and one for juice based products. Label one “Dairy” and the other “Non Dairy” You have to be careful not to mix them up for your lactose intolerant customers.

Coffee based cold beverages are always a favorite while the Italian sodas and fruit juice based smoothies are hot items on any beverage menu.

Check your local supplier for flavored syrups including Mocha, chocolate powder both sweet ground and white chocolate and cookies and a few of the tiny candy bars that can be blended with the milk based beverages to add that WOW factor.

Some of the flavored syrups that you should think about are:

Caramel

Vanilla

Strawberry and any other berry that you think will do well in your market

Lime

Orange

Hazelnut (make sure it does not contain any actual nuts)

Anything else that will appeal to your customers 

Be creative and try combinations that you believe will work. Test them on your team and family.

Here are a couple of easy recipes that are standard throughout the world to give you a start. You will have to play around with exact measurements dependant your glass size.

Italian Soda

A shot of flavored syrup over ice and top up with soda. Garnish with lemon slice, parsley or mint

Iced coffee

Shot of espresso or double amount of cold filter coffee over ice and top up with milk

Vanilla, Caramel or Coconut iced coffee

Add a shot of the appropriate flavored syrup

Iced Mocha

Make iced coffee as above with ice to almost the top of the glass and pour into blender add a tablespoon of sweet ground chocolate powder and blend till smoot and no ice chunks left. Pour into original glass and sprinkle with chocolate powder.

Oreo Smoothie

As above but add one or two Oreo cookies and blend till smooth

Fruit Smoothies

Use only high quality pure fruit concentrate made especially for the beverage market.

In a glass quarter fill with water another third of fruit puree and heap the rest with ice. Pour into a blender and blend till smooth and no ice chunks left. Pour into the original glass and garnish with fresh fruit if necessary. Mix and match to liven things up or add fresh fruit to make a healthy option.

A couple of tips:

  • For carryout use clear plastic cups with lids that allow whipped cream to be added above the cup line.
  • Have chocolate sprinkles and chocolate powder in shakers for the customers to add themselves
  • Make whipped cream an option, free of charge if possible or build it into the price and advertise “Free Whipped Cream”
  • Daily or weekly specials on a chalkboard is always a good way to advertise and gives it that “Fresh Daily” feel.
  • Most chocolate powders are pre sweetened as are the fruit smoothie puree’s but the iced coffees and real fruit smoothies are not so think about sugar packets or simple sugar syrup as a sweetener.

Good mixing and don’t forget to be creative.

QSR Customer Service Index 2011

The American Customer Service Index for this year has just been released and a few surprises jump out at me.

For many years Starbucks has been in the decline in store numbers both here in the US and in many other countries around the world with local opposition beating them in both service, price and coffee quality. Some would say that is not a hard thing to do but it seems their customers are happy with their offering, with a 2.6% increase in customer satisfaction over last year. That’s two years in a row of happy customers.

I am also happy to see Pizza Hut finally doing something right and again it is two years of increased customer satisfaction with this year being a whopping 3.8% over last year.

In fact the majority of fast food did quite well in the rankings with McDonalds beating the rest at 7.5% over last year.

The concepts that did not do as well are the ones that you would expect and I am a little sad to see KFC flat this year. They seem to have lost there way a bit recently. I certainly have noticed a downturn in product quality, service and cleanliness recently.

If you are interested in seeing the full list by industry here is how you get there.

http://www.theacsi.org/index.php?option=com_content&view=article&id=18&Itemid=115