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Why Restaurant Loyalty Programs Work

Menu for Success

“Where do you want to eat tonight?” may be a popular question asked among couples and families, but it may be one that is already answered before being asked. How can this be? Simply because so many customers are already loyal to particular restaurants that they enjoy eating at. In fact, a staggering fifty-four percent of restaurant customers say that they are loyal to a particular restaurant. If you are in the business, you certainly want to have a strategy to engage new diners and to foster their customer loyalty.

Loyal customers are not only great for the revenue that they produce themselves, but also as unpaid marketers for their favorite restaurants. The vast majority of loyal customers say that they would recommend a restaurant to their friends or family. They do this because they like the service and the food that they receive while they are there.

State of Customer Loyalty — Restaurants


The Power of Repeat Customers

On occasion restaurants may lose customers due to a variety of factors. When asked, customers most often said that the expense of the food was their reason for leaving. However, becoming bored of eating at the same place all the time also became a factor. Fortunately, there are ways in which a restaurant can win back those wayward customers. This usually starts with a customer win-back strategy that is integrated into the restaurants overall customer loyalty program. Afterall, it is a lot easier and cheaper to win-back a lapsed customer than it is to acquire a new customer.


A small business in particular relies heavily on customer loyalty as they attempt to compete with the big boys and stay afloat. It is not easy to be in the business environment when you are just starting out, so try to do as much as possible to encourage customers to return frequently to your establishment. In the Deloitte study, Second helpings: Building consumer loyalty in the fast service and casual dining restaurant sector, reported:

“We found that the overwhelming majority (71 percent) of the 26 percent who said that their most-visited restaurant offered a loyalty program both joined that loyalty program and used it more than any other loyalty program. What such a high conversion rate means is if you will build it, they will come. Even more promisingly, our survey results suggest that a restaurant’s best customers who belong to and actively use its program are more satisfied with the restaurant than those who do not. We also found that they are more apt to evangelize the brand to their friends and family. And membership in and usage of a loyalty program offers an additional benefit that is as important as any other—a way to track the behaviors of all of the customers who use it, whether or not they are a restaurant’s best customers. Loyalty membership databases are overflowing with information about customer demographics, purchase behaviors, and profitability, and such information can help restaurants shape individualized product offerings and heighten customer engagement.”

Keep Them Coming Back

Your loyalty program does not have to be complex to be effective. Here are a few tips:
  • Create a loyalty program that’s unique to your brand, one that your competitors can’t copy.
  • Focus strategically to generate incremental visits, and build profitable customer loyalty.
  • Use social media to advance your restaurant’s value proposition and to drive foot traffic.
  • Use personal recognition and rewards to create aspirational spending and passionate brand loyalists. Even a small gesture—such as a free beverage or dessert can help garner goodwill and drive brand affinity.
  • People can’t join a your loyalty program or you it if they don’t know about it or the value to them personally. Create an integrated communications plan across all touch points to ensure that customer’s know about the program and understand the value in participating.

Building Customer Loyalty in Your Restaurant

Why wait? Call today and learn how Customer Insight Group can help you turn your customers into your biggest advocates and most loyal fans. There is no obligation. 303-422-9758.