Customer Loyalty by the Numbers
It’s no secret that improving customer loyalty provides a tremendous boost to profitability. But how do you get people who come in once a month to come in twice or three times? External-marketing devices – ads, offers, discounts and the like – get people in the door. Then, your internal marketing needs to take over. Train your entire staff on the importance of providing exceptional service that sets you apart from your competition. You and your staff should learn and use guest’s names, and create special offers just for regulars. Remember, what you do to get people in the door isn’t nearly important as what you do internally to get them to come back.
The Bad News about Customer Service
Here’s the bad news: if someone has a bad experience in your restaurant because of poor or indifferent service, statistics show they’ll tell 10 to 12 other people — who weren’t there — about how bad it was. Those 12 people will tell six others, and those six will tell three more people each. Total it up and that’s 300 people who hear about that bad service experience through negative word-of-mouth advertising. You may have lost a potential 300 new customers per day by making one customer angry enough not to come back and tell a dozen of his or her friends not to, either. Add social media sharing and online reviews into the mix, and one bad experience could end up at the fingertips of thousands of your potential customers.
And if that wasn’t bad enough, take a look at these other statistics about customer loyalty:
- Only about 4% of dissatisfied customers complain. 96% just go away. (Harris Interactive Customer Experience Improvement study)
- It costs 6 times more to attract a new customer than it does to keep an old one. (Ruby Newell-Legner)
- A 2% increase in customer retention has the same effect as decreasing costs by 10%. (Emmet Murphy and Mark Murphy)
- The probability of selling to an existing customer is 60-70%. The probability of selling to a new one is 5-20% (Marketing Metrics)
The Good News about Customer Loyalty
Don’t worry, there’s good news, too. The restaurant business is show business, and that means you have multiple opportunities each day the stop negative customer experiences before they happen. The key to customer loyalty is a training program that focuses on providing exceptional service and ensuring every guest leaves happy. A guest is likely to give you a second chance even if they didn’t enjoy their meal as long as the service wows them. Great service can save a bad meal, but a good meal cannot save bad service.
Never miss an article. Subscribe to RTO’s Blog