At the beginning of every new year, restaurant operators receive an endless number of lists from “trend watchers” that supposedly spell out what consumers will want to eat, drink and do at restaurants in the new year.
However, consumers repeatedly demonstrate that there is no “average” customer – meaning restaurant operators need to focus their attention on what their individual customers actually want.
That is true now more than ever with the overall number of restaurants in the U.S. falling and overall traffic for 2014 essentially flat.
The Challenge, The Answer, The Solution
If you aren’t expanding by adding new locations, how can you grow your business?
The answer: increase year-over-year sales by increasing the frequency of purchase and expanding your customer base.
Repeat customers usually only make up about 15% of a restaurant’s customer base, but they typically provide at least 1/3 of the revenue. Researchers at Harvard have found that if repeat visits increase by 5%, profits will also increase anywhere from 25% to 125%.
You’re probably thinking, “But wait, traffic is stagnant – so how am I supposed to increase the frequency of purchase and expand my customer base?”
In order to boost the frequency of visits by regular customers, simultaneously grow your customer base and effectively utilize various marketing strategies, you must know who your customers are, where they are and where more of them can be found.
Getting to Know Your Customers with Customer Analytics
The best way for restaurant operators to discover who their customers are is through enriched customer data that goes beyond loyalty program data, email lists and transaction records.
By leveraging customer data, it’s possible to create unique customer profiles based on the customers within the trade area of each individual restaurant location.
This 360 degree view of customers will also help operators understand what their customers want and create seamless strategies in terms of pricing, targeted promotions and additional menu offerings.
But that’s not all.
Customer profiles and analytic solutions allow restaurant operators to:
- Optimize store renovations and other major initiatives
- Develop marketing campaigns that hit the right customers with the right messages in terms of dayparts, price points and regional preferences
- Identify and target untapped customers in existing markets
- Track customer lifetime value and measure that value against ultimate customer value potential
The Bottom Line
The bottom line is that the restaurant operators who know what their customers want and provide the experience customers desire will have the greatest opportunity to optimize and maximize growth.
Want to find out how customer analytics can help your brand come to the table with a competitive edge? Pull up a chair and find out.