Did you know that the top 10% of your customers often spend over 30% more than your infrequent guests (bottom 60%)? Do you know who your VIPs are, how many times they come in every month, what their average check amount is, and if their visits are increasing?
If, as a restaurant operator, you don’t know this critical information, you’re leaving money on the table or, more likely, never getting it to the table. Ensuring your VIP and core guests return through loyalty programs, targeted marketing strategies, or exceptional service should be a priority.
Fortunately, today, a restaurant’s world is awash in data. Internal and external data sources abound with the point-of-sale (POS) system leading the data analytic charge. After combining, organizing, and cleaning, this data can be used to recognize risks, spot emerging trends, determine their cause, and take proactive measures to increase profits and guest satisfaction.
How to Use Data Analytics to Improve Customer Retention and Spot Customer Trends
Data analytics gives restauranteurs the competitive edge they need in an increasingly tight-margin industry. By understating their customers better, operators can adjust their offerings and marketing agenda, ensuring they’re appealing to their VIPs. Here are just a few of the many benefits derived from delving deep into your customer profiles.
Recognize growing risks.
You or your data partner spot a 10% decline in the number of VIP visits from last month. Your team members gather to share some possible insights: Perhaps the menu has failed to keep up with shifting consumer taste trends or a competitor recently opened a few miles away.
The first step in successful operations is knowing the right question to ask. Only then can you use experiential and analytic processing to reveal the answer. A restaurant at risk of losing its VIP customers requires fast action from the team. Using analytics to recognize risks at an early stage increases the likelihood of catching a decaying trend before a substantial loss occurs.
In any business, vision becomes obscured due to the day in and day out repetitive nature of operations. Beliefs and habits are born that sometimes require a little nudge in a different direction or a good shove. Data is that voice and vision that removes the blinders and sets restaurants on an accelerated upward trajectory because of actions driven by data and insights.
Offer VIP service to your VIP customers.
Tracking orders, payments, lifetime spend, and visits, enables restaurants to provide great customized service to their most loyal guests. Integrating a data analysis platform with the POS allows restaurants to track this information and more, including your VIP’s and core customer’s favorite meals and drinks.
Sharing this information with servers who then use it to customize recommendations and recall a guest’s customary order can make your VIPs feel like they’ve found their home away from home. “Would you like a glass of your favorite wine?” “I believe our special is one you’ve enjoyed before.” It’s this type of service that distinguishes two similar concepts.
One survey revealed that 7 out of 10 customers spend more for great service, while another found that a one-star rating increase in Yelp correlated with a 5-9% increase in restaurant revenue.
Develop a targeted marketing strategy.
Understanding the lifetime value of your guests and their preferences allows you to send targeted offers based on a guest’s preferences and the days and hours they are likely to visit. Developing enhanced customer profiles helps to achieve this goal. The more you know, the more you can customize your communications.
Tools to Help You Succeed in The Data Analytics & Customer Retention Game
Combine the best-in-class restaurant analytical tools with EMERGING’s result-focused data science and Intelligence Briefs.
EMERGING, collects the raw data your restaurant creates and turns that data into actionable insights that illuminate trends, reduce risks, and increase revenue. This data-driven approach helps operators determine the key factors creating possible disruptions, such as what’s driving your VIP guests to the competitors.
Free monthly EMERGING Intelligence Briefs use your POS data to track and analyze customer spend and frequency. By creating VIP, core, and infrequent customer profiles, the Intelligence Brief reveals weekly visits by each group, the rise or fall in activity, the average revenue per visit, and the recaptures. Compare this data by the week or month, and by one or all locations, to gain perspective and recognize and unravel the bigger picture.
Do you know who your restaurant’s most valuable customers are and what they are worth to your business? EMERGING’s Intelligence Brief helps you retain and attract VIP customers to increase top-line revenue.
Sign up for your free monthly EMERGING Intelligence Brief HERE.