Outside Insights | December 2012 | By Steve Baxter

The Effect of Customer Loyalty

How to identify, improve, and maintain a positive experience in your restaurant.

Fast food customer loyalty programs boost the overall brand experience.
Steve Baxter is the general manager of Global Midmarket Solutions for Satmetrix Inc.
Bookmark/Share this post with:
Email this story Email this story
Printer-friendly versionPrinter-friendly version

Read More About

Nothing is more critical to the success or decline of a restaurant establishment than what customers think or say about its food and services. With the holidays upon us, restaurants will experience an influx in traffic during one of the busiest times of the year. With more customers coming through the doors, the holidays are the perfect time to keep your eyes open for customer feedback—both positive and negative.

As a rule, restaurant owners and managers who understand and appreciate the significance of customer loyalty are the ones most likely to thrive. Those that don’t “get it” generally experience challenges that can seep into multiple areas of operations, including overall sales as well as recruitment and retention of loyal customers and employees alike.

Restaurants that deliver a customer experience that drives engagement and generates strong recommendation behavior on all levels will get a higher return. Customer experience directly impacts referrals, repurchase, renewals, and reputation. Today’s competitive market, combined with word of mouth through the Web, amplifies the impact customer loyalty has on financial performance at a restaurant, particularly so with establishments that are part of a chain or larger system.

Restaurants that deliver a customer experience that drives engagement and generates strong recommendation behavior on all levels will get a higher return.

Net Promoter Score is one of the most widely adopted customer loyalty metrics today. However, it’s become increasingly important for restaurant owners and managers to go beyond just “knowing their number” to analyzing and understanding the feedback they receive and use it to improve their establishment. Loyal customers have a profound effect on those around them, so it is important to have a way to identify and mobilize advocates, as well as close the loop and address customers who have gone negative. Knowing what customers are saying about your food and service, and being able to segment drivers or aspects of that sentiment, creates insight that you can act upon to help improve customer experience or maintain customer loyalty. With so many customers coming through your doors to dine during the holidays, this is a perfect time to start measuring and addressing feedback so changes can be made in the new year, if necessary.

If your restaurant is part of a chain, the systems’ intricate structures and hundreds or thousands of locations can make it difficult to thoroughly measure, understand, and address customer loyalty feedback. But new software approaches that deliver Net Promoter are making this possible, moving from being a packaged commodity to a complete system that delivers insights and actions that drive success. For example, Satmetrix software, NPS Go+, pulls feedback and survey responses from across the entire restaurant system using varied sources such as call centers, training groups, implementation teams, and social media conversations, and provides segmented reporting and detailed analysis. The software helps restaurant owners and managers identify promoters and detractors and implement better strategies, based on that feedback, to improve customer loyalty.

Results are achieved by recovering detractors and mobilizing promoters, allowing you to contain or increase revenue. Alert management and reporting by segment lets you take specific action and extend it to improve operations. Mobilizing new promoters and reducing the detractors allows restaurant owners and managers to do that quickly. NPS Go+ delivers quickly by delivering insights and routing alerts to the appropriate people throughout your system. This results in making improvements in operations that directly impact and improve customer experience, and getting a return on your investment faster by delivering more revenue through retention, renewals, and upsells. NPS Go+ can be up and running in less than a week.

Promoters are those who recommend your food, service, or restaurant as a whole, both in person and online. They tend to provide stronger value not only in their own purchase behavior, but in the effect they have on others. Detractors are those who view your food, service, or restaurant as a whole negatively, and it is important to be able to act quickly and address these at-risk customers as soon as problems emerge. Closing the loop with detractors not only minimizes negative business impact, but real attention paid to such customers often fosters loyalty and transforms a detractor into a promoter. Satmetrix software solutions offer real-time feedback allowing restaurant owners and managers to identify at-risk customers or segments that require action. Shortly after negative feedback is received, restaurant owners or managers are alerted about the issue and can immediately respond, and when appropriate, put a recovery plan in place.

Role-based dashboards and homepage reporting make it easier for the most appropriate employees in every unit to monitor and address customer loyalty by unit. Restaurant establishments are able to track loyalty by team, department, region, product, or survey program, making it easier to identify and implement specific tactical process improvements that improve customer experience. Satmetrix software can be integrated into the workflow that a restaurant system already uses with its front line, such as Salesforce or Outlook, making operations efficient and reducing administrative overhead. Reports describe what customers are actually saying and are tailored to each role and each employee. Your business grows by leveraging relationships with promoters and closing the loop and recovering detractors.

The influx in traffic during the holidays, as well as the high potential that you’ll be servicing first-time customers, make this an optimal time to start monitoring and responding to customer feedback. Understanding customer feedback across the entire restaurant establishment and being responsive to both negative and positive customers provide a complete picture of your customer world, generating much higher return and success for all facets of the brand.

 

Steve Baxter is the general manager of Global Midmarket Solutions for Satmetrix Inc., the co-creator of the Net Promoter Score concept. He has designed, created, and implemented Net Promoter Score solutions used by thousands of companies. He can be reached at (678) 231-1951 and steve.baxter@satmetrix.com.