Building customer loyalty is the ticket to creating a steady flow of business. Many cafe business marketers underestimate the importance and value of their loyal customers. Others recognise the importance but struggle to find a way to track customer loyalty and reward their loyal customers. When you have a solid customer base, you will be able to scale your business and thrive. Acquiring new customers is great, but the critical step is figuring out how to keep them coming back.
So, let’s look at the numbers. According to studies, sixty-six percent (66%) of customers switch brands because of poor customer service. Likewise, fifty-eight percent (58%) will never do business again with a company after a bad experience.
Next, we need to look at spending power. There is a strong argument that marketing focus should be towards millennials because they pay more attention to user-generated data vs. older generations and are also in tune with technology. Their high usage and accessibility to devices that allow them to purchase whatever they want when they want it is another factor.
On the other hand, baby boomers should not be disregarded as they continue to play a large part in spenditure. Compared to generations that preceded them, Baby boomers are retiring later, holding on to more debt and maintaining budgets for travel and other discretionary treats.
Keeping the aforementioned in mind, there are several strategies that you can use to build customer loyalty; here’s 10 we’d like to share with you.
Knowing your customers is important. If you have a restaurant or cafe, consider the demographic of the neighbourhood you are in and expand from there. Use this as a baseline for your marketing strategy, special offers and loyalty programs. Figure out what will resonate with your target demographic. This will require a lot of trial and error at first, but try different things and take note of what does well and build your strategies around that information. At this point,you can create a customer persona that will lead us to our next strategy.
Create a customer funnel
Once you have identified your ideal customer, you can now create a funnel to drive returning customers. Here’s an infographic from upserve.com to help you create a customer funnel.
Create a dynamic loyalty program
Loyalty programs can be anything from a punch card that gets you a free cup of coffee or dessert with your 10th purchase to a points system that earns you various perks upon accumulating a specific number. Once you have identified what works best, you can build your loyalty program to make sure that your customers feel that it is worth coming back for. Some important things to keep in mind when creating your loyalty program:
- Keep it simple- Make sure that the rules are clear and easy to understand. Limit the conditions and do not over complicate things.
- Keep it top-of-mind- Make sure you market your loyalty program well. Train your employees to mention it to all customers. Use social media, SMS and email.
- Make it dynamic- Give your customers a reason to keep using your loyalty program. If you have a day in the week that consistently seems slow, offer something special, like double points for example. You can also offer holiday exclusives, etc.
Contactless ordering and delivery
Due to the global pandemic, restaurants and cafes have had to pivot towards providing contactless ordering and delivery services to survive. Providing this service is a great way to build customer loyalty because it lets your customers know that their safety and convenience is a priority to you. This is also a great way to test new products or menu items, with less risks. If you aren’t quite ready for delivery, other changes within your business such as QR code menus and cashless payment could be a good jump-off point.
Restaurants, cafes and other hospo businesses often play a special role in communities. There will be those who have significant memories attached to your establishment, first dates, reunions etc. While we are still living through the pandemic, you can support your community through food drives, community pantries etc. You can also find a charity or organisation with advocacy that is close to your heart and find ways to support them. 81% of consumers want to see businesses provide food or supplies to community organizations, events, or service providers. This is an opportunity to make real connections with your customers and community.
Be visible online
Having a strong online presence is a great way to keep loyal customers. It will help build and keep a sense of community and connectedness. It isn;t enough to put up a website and create social media pages. Make sure that you are constantly updating and engaging with your audience too. Not only will you be able to publish updates about your business, but this is a great way to stay connected with your customers.
Here are some crucial statistics about referrals that you need to know:
- When referred by a friend, people are 4x more likely to make a purchase.
- Referred customers' Lifetime Value is 16% higher when compared to non-referred customers.
- Customers acquired through referrals have a 37% higher retention rate, and 81% of consumers are more likely to engage with brands that have reward programs.
- Referred customers have an 18% lower churn than customers acquired by other means.
- You can expect at least 16% more in profits from referred customers.
Referrals are an important part of building customer loyalty. Word-of-mouth is great, but how can you build on that? You can incentivise referrals, for example, add a bring a friend incentive onto your loyalty program. You can generate a personalised code for your loyalty program members to give to their friends, etc. A referral strategy can be powerful in both generating new customers and building loyalty.
Asking for online reviews can be tricky. You will not be able to guarantee that 100% of your reviews will be good because they will always be subjective. However, they can also be a powerful tool in building customer loyalty. You can highlight good reviews on your online profiles and address bad ones. If you get a bad review, always try to spin in in your favour by responding to them.
One sure way to keep your customers coming back is to give them experiences that they will treasure. If someone is celebrating a special occasion, you can give them a free dessert or a special perk. You can give a free slice of cake to your loyalty program members on their birthday. Once it's safe again, you can host game nights, or dress-up days (come in your pajamas and get a free coffee).
Creating unique experiences for your customers is a great way to drum up business and keep them coming back for more.
It's always a great idea to collaborate with other businesses. Everyone wins in these cases and, by doing so, you open yourself up to new opportunities and get the word out to people who may not have known about your business and vice versa. Be aware of other businesses in your area and think of ways to work with them. For example, you can have a voucher for a free dessert at a local ice cream shop after your customers have dined at your establishment and the ice cream shop can give out a voucher for a free appetiser if their customers have purchased a certain amount at their store. The opportunities are limitless.
Before making any plans, be sure to assess:
- Your staff- Make sure you train them well, provide the tools they need and be clear about the kind of customer service you need them to provide.
- Your product- Make sure you have the best suppliers and that they provide the best quality goods.
- Your goals- Be clear about what your goals are and build strategies around how to reach them.
Loyal customers are not just a promise of repeat business, they can also be your mouthpieces and advocates. Ultimately, it's not about rewards and gimmicks but about the quality of service and product you provide.