Why Should a Restaurant Invest In Customer Retention?

4 min readAug 21, 2018

Customer retention is one of the most important factors in every industry that plays a vital role in business growth and profitability. Without loyal, repeat customers, it’s hard to succeed in any business. Similarly, in the hospitality industry, customer retention plays a significant role in the growth of a restaurant. Obtaining a new customer is 7–8 times more costly than retaining an existing one. An increase in repeat customers orders can increase profits rapidly.

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What’s so good about repeat customers?

According to a study from BIA/Kelsey, a repeat customer spends up to 67% more than a new customer. That means, having a repeat customer is much better than the new one. Thus, you need to also focus on retaining your existing customers along with working on bringing new customers.

A regular customer is a key to maintain a successful restaurant business. Repeat customers base brings many benefits to a restaurant.

Repeat customers keep your revenue steady and increase profit

According to the HBR study, a 5% increase in customer retention can raise profit by 25–95%. The repeat customers can arrive, eat on daily basis, and might be responsible for increasing bigger profits and keeping your revenue steady. That means you have a regular revenue stream that you can rely upon. You should use this revenue to bring in new customers and convert those to repeat customers to build a customer acquisition/retention flywheel effect. Thus, having repeat customers and new customer flywheel can significantly skyrocket your profit and business success.

The best advertising is word of mouth from your repeated customers.

55% of loyal customers tell their friends and family about your business. A customer who had a great experience in your restaurant will spread the words for you, which means you will get the best advertising without spending hard earned money. A happy customer will talk about your business to their friends and family, ask them to check out your place, suggest them to try your services or product, and share his/her experience. It means you will get the more new customer on your door. It will also help you to build a powerful positive relationship with your existing customers.

Repeat Customers are more likely to be loyal to your business.

A regular customer is always able to build a strong online reputation of a business. If you’re looking to improve your restaurant business, then you have to focus on customer retention as a regular customer will provide more honest feedback. Try to get feedback from someone who has tried your food several times rather than new customers.

So, what you can do to keep customers coming back?

Several things. Yes, you need to do several things in order to retain your customers and bring them back. Some restaurants just improve their food quality, or offer discounts or enhance a restaurant look and so on. No doubt, these play a vital role in the process of customer retention. But still, you need to make more comprehensive efforts for a long-lasting impact. Here are a few important steps that you need to perform to keep your customers coming back again, again and again.

Better Customer Service

There’s no rocket science, the best customer service is surely going to keep your customers coming back for several times. A good experience consists of numerous important things such as quality food at a right price, with a good environment and hospitality. Moreover, you need to understand your customers’ needs and provide them with the best services.

Build Strong Customer Relationship

To retain customers, it is important to build a strong relationship with them. A great relationship doesn’t just happen, you need to consistently add value to your customers’ experience to make those relationships grow. Make sure to improve your customer services and own any mistakes made along the way. Don’t skip, a loyal customer is your best salesperson. So, nurture your customer relationships and receive the rewards of loyalty.

Personalized Experience

Personalization has become an important part of the food industry as it helps to create great customers experience. Today’s customers demand personalization. In order to retain customers, boost loyalty, create more significant and stronger relationship, build brand awareness, personalizations plays a vital role. The very first thing that acts amazingly to create a personalized experience is storing customers’ information like name, order history, and preferences. Even, a customization like time-based activation, welcome message, select assistant accents, also a great way to serve customers extremely. This will help you to understand your customers better and offer specials based on their meals choices.

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Enticing Loyalty Programs

Do you know? 79% of consumers look for deals and rewards from loyalty programs before making a purchase! Yes, it is true. Discount offers and loyalty programs work well to make customers happy and loyal. And, Customer loyalty is also a common yet important factor to bring them back to your door.

Moreover, you can keep your eye out for the new technology that can help expand your customer retention by covering all these important factors. We at Voix are building first restaurant AI voice assistant which is built to provide best and personalized ordering experience for every single customers. Voix uses AI to have a personalized phone ordering experience to your customers, improve customer services with no call hold times, increase customer loyalty by offering specials and helps the restaurant to increase revenue. Learn more about Voix to see how we are helping restaurant owners to retain their phone customers.