CORRECTION: FAIL TO LIVE UP TO THEIR TRUE POTENTIAL
Yesterday, I wrote about our failure to combine our restaurant customer acquisition program and loyalty software.
However, I didn’t go deep enough to explain each program’s path and why loyalty programs tend to fail. And when I say FAIL, I mean they never reach their full potential.
Let’s do some math.
The image above shows what buckets the customers who walk into your restaurant fall into
– 1,000 customers who visit monthly, meaning individuals who do business with you at some point.
– 200 customers who visit monthly, whose data you have.
– 150 customers who visit monthly who are a member of your loyalty program.
Think about that; that means that 800 or so people spending money with you are GHOSTS regarding your planned marketing programs.
CUSTOMER ACQUISITION FOR LOYALTY?
This is where our restaurant customer acquisition program comes into play—or at least I thought it did. For years, we could easily gather 500 of those 800 customers’ data and drive 30-40% of them into the restaurant with an irresistible promo. So when we acquired Repeat Returns, I thought we could mix the two programs much more easily than we could.
My game plan was to take our acquisition program and funnel those customers into the Repeat Returns system, thinking the more, the merrier.
Well, what I failed to realize was the importance of “dating your customers first” before asking to marry them with your loyalty program.
As the image below shows, your customer journey is just like getting married. You don’t typically meet someone and jump right into marriage; heck, many times, there’s a long process inside the “intro” phase before you enter dating mode.
So, we have learned that we are fixing the marketing programs we run because we can’t speed up the process. We can’t skip dating, which we tried to do with our revised customer acquisition program in 2024. We ran marketing campaigns online to get customers to raise their hands and then threw them into the loyalty funnel. It still worked, but not at the level it could have. We saw customer conversion rates go from 30-40% to 15-25%.
THE FIX
I’ve learned over the past 25 years of marriage that you never stop dating your spouse; the same goes for marketing. But more importantly, you also can’t SKIP the dating phase.
The fix to this problem is to realize that you must have programs for all of your customers, not just a few, to have a successful marketing program.
Our acquisition program is an attention-getting program that applies to everyone, and once they use their first promotion, we’ve started “dating.” Next, it’s up to us to WOW them along the way, and then, and only then, once they’ve visited many times, can we ask for their hand in marriage, I mean loyalty:)
