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Guide to Restaurant Customer Acquisition Part 3: Retention

Oct 29, 2021
min read
Written by
This article outlines:
How to use restaurant data to inform your customer retention strategy
The benefit of analyzing data with cohorts and customer segments
Tips for building a healthy customer base long term

ow that we’ve broken down the fundamentals of restaurant customer acquisition and shared some winning strategies to test, it’s time to shift focus to retention.

Once you’ve found and attracted new customers, how do you build a healthy customer base with high CLV? The answers are in your restaurant data.

Four Questions To Ask When Analyzing Restaurant Data

As you start to analyze, consider these four important questions, which should serve as the basis for your customer retention strategy and inform future acquisition efforts.

1. Who have you acquired, when, and how?

2. How are your guests progressing through the customer lifecycle?

3. What characteristics do your customers share?

4. How can you influence behavior to mirror the actions of your most valuable guests?

In order to keep restaurant customers coming back, you first have to take the time to learn who they are, along with their preferences, motivations, and behaviors. Within your data, you can find out what initially drove customers to your business and why they keep coming back—or why they’ve stopped returning—by looking at things like location, visit frequency, average spend, preferred method of ordering, time and day of visits, marketing engagement, feedback, acquisition campaign/channel, etc.

Focusing Retention Efforts With Cohorts and Segments

Rather than attempt to boil the ocean when it comes to retention, some brands analyze their data by cohorts, or groups of customers acquired at the same time, to evaluate repeat purchasing, churn, spending, reliance on customer acquisition, and other trends over time. By doing so, they can uncover when exactly customers become brand-loyal and why, and create retention campaigns specifically designed to move them forward in the life cycle.

For example, you might discover that once guests reach the four-visit mark, you’ve retained them for life. And so, the challenge then is figuring out how to move cohorts from 1-2 visits to 2-3, and beyond.

Additionally (or alternatively), you can analyze your restaurant data by customer segments based on shared characteristics, such as guests with high CLV, website visitors, online orderers, on-premise guests, weekend warriors, WiFi signups, catering orderers, and more.

To ensure that each segment becomes more valuable to your restaurant brand over time, you should be thinking about ways to influence their behavior in a positive way. For example:

  • Giving weekend warriors a reason to also visit during the week, like Happy Hour or live music
  • Encouraging email subscribers to sign up for SMS messaging for insider perks
  • Inviting on-premise guests to skip the line with online ordering
  • Directing online orderers to download your user-friendly restaurant app for quicker service
  • Incentivizing churn risks to return with an enticing offer

Tips For Building a Healthy Customer Base

To build a healthy customer base with high CLV, start with these 5 winning restaurant customer retention strategies. The article is filled with frameworks you can use to increase guest engagement, encourage reorders, solicit feedback, and keep your restaurant top of mind across channels.

Note that no two cohorts or segments are exactly the same, so impersonal, mass communication isn’t going to cut it. The best restaurant brands leverage data to retain guests by personalizing the experience at every touchpoint—from social ads and email to interactions at the host stand or counter—based on individual behavior and preferences.

Ultimately, every restaurant brand is challenged with testing different retention strategies to find out what works for their customer base. The best win-back campaign for your churn risks may be a free appetizer, or it might just be a perfectly timed email with menu recommendations based on their order history.

By studying your data, you can identify cross-selling, bundling, or promotional opportunities that you may not have previously considered, and use that intel to create irresistible campaigns to meet your goals.

Series Wrap-Up and Next Steps

As we close out this series, remember that the best customer acquisition strategies are rooted in guest data generated by an integrated tech stack, utilize highly detailed customer segmentation, and take an omnichannel approach to find and attract the right people at the right time on their preferred platform. But customer acquisition doesn’t end with the first visit.

To build a healthy customer base that keeps coming back, restaurants need to regularly leverage their data to identify trends, monitor progression through the customer lifecycle, and develop retention strategies that meet individual customer needs and preferences as they evolve over time. Furthermore, by unlocking customer lifetime value and studying the behavior of high-value guests, brands can positively influence behavior and strengthen engagement across their entire customer base.

For more data-driven retention strategies for your restaurant, request a demo.

Photo by Taha Samet Arslan, Pexels