Building Customer Loyalty Using Your Restaurant POS System

If you’ve operated a restaurant for more than 20 minutes, you’ve probably learned that in order to keep living your dream, you’re going to need customers to spend money. They can’t just be one-and-done customers, either. According to one study out of Harvard, increasing repeat customer numbers by as little as 5% can boost your profits between 25 and 95%.

But how do you do that?

While it’s important to serve up great food, employ friendly staff who delight your customers and create an environment that people enjoy, there might still be one piece of the puzzle missing. A loyalty program may not be the first thing that comes to mind, but it’s proven that converting first-time visitors into fans makes a huge difference for your bottom line.

Establishing a Restaurant Loyalty Program 

Before we jump in, it’s a good idea to understand what a loyalty program is and how to integrate it into your restaurant POS system. In simple terms, a loyalty program is a great way for restaurants to engage with their customers in various ways, ranging from discounts and coupons, to free meals and other rewards – just for being a fan! 

Several restaurants have done an amazing job with their loyalty programs (Starbucks is arguably doing the best), but the process of building, cultivating and, ultimately, cashing in on these repeat customers boils down to a few simple thoughts.

The program needs to be easy to sign up for. It might seem like slam dunk to just grab a stack of wallet-sized loyalty cards and your favorite hole punch and go to town, but if your restaurant point of sale includes a loyalty program built into it, use that instead 

One thing a digital loyalty program has over its traditional cousin is that it allows you to collect data from your customers every time they make a purchase, helping you provide them with a personalized experience that a punch card could never provide. 

It should be obvious, however, that the days of a one-size-fits-all approach to loyalty are dying, if not already dead. Digital loyalty programs maintained and curated by your POS system allow you to offer up exclusive coupons and discounts on special days or events, like a customer’s birthday, and lets your customers track their progress either through your site or mobile app. 

It might seem like a great idea to offer discounts and coupons to everyone who downloads your app or signs up for your program, but some people are only in it for the free birthday meal or discounted coffee when it’s convenient for them. In cases like this, offer small discounts and benefits to these returning customers because everyone likes to feel special, but be selective with your customers. Try to keep your exclusive offers and best deals for your ideal customers; you know, the ones who come in every day and are constantly spending money supporting your business. 

Why Having A Restaurant Loyalty Program Makes Sense 

Thanks to growing competition in the industry, picking and choosing how to implement a loyalty program and maintain it are gaining more attention from savvy restauranteurs. Paul Rubin, PAR’s Chief of Strategy, says the trend likely isn’t going away soon.

Strong loyalty programs will create a balance between the needs of the business and the desires of the guests,” Rubin said. Programs that do not offer value to the customer will become obsolete, as customers will not find engagement in these types of loyalty programs. Similarly, programs that have no benefit to the business will not last either. Sources of big data statistically show that customers are willing to give their loyalty in exchange for value.

The rise of cloud technology also makes instituting a reliable and smart program possible. The right cloud-based POS software can tailor rewards and promotions to specific customers based on their preferences, order history or location.

But a good loyalty program shouldn’t give up the farm to its customers without a little something in return. For the most part, customers are willing to trade a little bit of their time or information in return for the value your brand provides. When you think about it, it’s a lot easier to get someone to tell you something when you have something to give back.

Thanks to your POS system, all the valuable data you’re collecting can be used to tailor your brand to your audience, build a better rapport and turn a larger profit. Are you seeing that your loyalty members are purchasing a certain product more often at certain times of the day? It might be worth offering your best customers a discount on that menu item at that peak time.  

By having the right data in your hands, it’s possible to see where your biggest winners are and spend more time pushing the workhorse items on your menu. 

Big DataThe more data we have on a customer — where they live, demographics, birthday, purchase history, etc. — the more the program can optimize for that customer’s preferences,” Rubin explained. While there will always be a thematic component to the marketing campaigns driven through loyalty programs, the rest of the content can be tailored for each customer to keep the program interesting and of value. This, of course, keeps the restaurant’s brand interesting and relevant for each customer. 

It’s no secret that customers who love your brand will tell their friends, family and others about you. These all-important repeat customers have a vested interest in you, so they’re more likely to provide you with honest feedback, participate in surveys, and can market your menu better than any marketing agency out there.

And to think, all this powerful information and advertising power are harnessed right on your countertop. Pretty cool, right? If you’ve got a loyalty program that still uses paper punch cards, consider your options in the cloud. If you’re already using cloud-based POS software, see if it has built-in loyalty features like PAR’s Brink Loyalty. If it doesn’t, check out some of the amazing third-party options available. 

No matter what you do, loyalty programs are just another way of making sure the customer is number one.