Customer Loyalty

AIR meetings are great for me as I selfishly get to hear from a lot of restaurateurs at once, and these guys are very very busy people.

I won’t be able to get everybody’s name or position right so please bear with me.

I wanted to put down my thoughts on key takeaways from this very important topic or topics – loyalty, discounts etc. etc.

As from past AIR meetings there seems to be very much two school of thoughts with perhaps Tim (ex-Fortnum’s) best matching mine as a hybrid of the two.  I was marketing director of the Gate Restaurants from 2013 to 2017 which saw the reopening of the original site after a nearly 2-year refurb (instead of the promised 6 months), opening a second site on the other side of town while the first was closed and a third site in December 2016. There was special set of challenges awaiting us. Despite being open for over 25 years we only had a limited number of email addresses (not even held by us), a web site that didn’t work on mobiles and an ageing but loyal customer base and very little social of our own creation. So, leaving aside the practical issues of food consistency, how do you grow your audience without alienating your original customer base and with a very modest budget and a slew of younger rivals. Social engagement. (shameless plug - for anyone interested in the details of how we achieved this please email hello@socialdiners.com)

I also want to puncture some myths along the way:

1.     One school, let’s call it the old school, seemed to be demonizing the whole digital piece. So, let’s put it this way – social media is word of mouth turned up to eleven. With one extremely vital point of difference: YOU can take part and influence what is being said about you. It’s something to be embraced as it allows you to talk to far more many people in real time than you would have been able to before. Like anything else, it’s both good and bad, depending on what you do with it. But if someone’s talking about you, surely you should make sure it’s accurate, at the very least.

2.     Young kids aren’t loyal. This was the biggest canard by far the whole morning. This generation is loyal to brands, as loyal as the preceding generation but with the ability to influence the brand by praising the good stuff. Several excellent restaurants that started as street stalls or pop ups, have succeeded in no small part because of the loyalty of their fans – on social media and eating there often – Pizza Pilgrims, Big Apple Hot Dogs, Patty and Bun to name just three. But it’s not just social, people are showing their loyalty by putting their money where their mouth is (and then food into that mouth). Som Saa started as a food stall and when it came to opening a permanent site they raised £700k in a matter of a few days. I think every restaurateur in the room would kill for that type of loyalty. This generation has an emotional connection to brands which can work to your advantage if you let it. Or it can fail spectacularly if you screw it up. For some unfathomable reason, Pepsi hijacked the BlackLivesMatter campaign with Kendall Jenner as the face and that resulted in a huge backlash for all those involved, millions of dollars wasted and a whole marketing department publicly humiliated and junked.

Starbucks in 2016 removed Christmas trees from their coffee cups in a bid to be all inclusive and non-specific. Guess what – sales fell. (Though this did lead to Donald Trump calling for a boycott on Starbucks - Now this is somewhere I deliberately avoid, but that perversely kinda made me want to get a cup of sugar and milk.)  Don’t try to be what you are clearly not and more importantly, know your customer.

3.     “How do I do that?” Was a question from Kitty Fisher when Tim from Fortnum’s talked about the necessity for a hybrid approach. Well Kitty, you guys are already doing it. You may not accept electronic reservations but when it came to quiet time – January, you mailed a select group of customers news of an offer – let’s not call it a discount, let’s call it a loyalty bonus – and voila you were sold out. You also had a gem of an idea (which I may actually have to steal) about straws and free drinks. But how did you hear about the plastic curse in the first place…..

4.     Re loyalty, unless you have that warm welcome and the waiter remembering your favourite tipple then I agree, you have nothing; but it doesn’t start and end there. Loyalty goes beyond the four walls of your restaurant and lives online. Again, you just have to think about it in a different way. The music industry had a very (justifiably) rude awakening with web 2.0 and they had to change how they operate completely. If you can hear the music for free what have you got left? Well, you have everything. You give away your music for free, but you’ve built up your own audience through YouTube or spotify and now you charge people for the gigs, the downloads and of course the T Shirt. You can do gigs in people’s houses. Or you can charge for a meet and greet. All of these things engender loyalty. Acts put up stems (all the original parts of a song) for their fans to remix. Fans create their very own videos. Remember fans is an abbreviation of fanatical. They’ll now pay top dollar for a package that includes a CD/limited edition vinyl/artwork and MP3. These guys are fanatical about what they love.

That’s why fan fiction exists. There’s such a strong emotional connection with the book, film, record and yes restaurant that people feel part of the brand and that’s part of the engine that drives it. That’s why someone created a cookbook based on food described in the Harry Potter series from tips being shared on blogs, twitter and YouTube. 150,000 copies in hardback and counting. That’s why Temple of Hackney can start life as a food stall on Broadway Market and Instagram, that’s why Som Saa raised £700,000 in just 3 days, turning down big investors and raising it from customers instead. (Google ES magazine and Som Saa). People want to feel that the brand belongs to them too, and that’s why you win. You keep your fans/customers entertained and if it’s a great shot of your latest dish or your latest mix from soundcloud, this will be shared, and it will be shared by people who love your brand and remember your brand, however many times they come to eat. Music and food are inextricably linked (at least to me) and if music prompts the senses to make you remember that evening it will surely stimulate other appetites and make you want to go back. Kitty Fisher team were talking about locking in memories – and music is a great aide memoire.

5.    I don’t have time. I can totally understand this appearing daunting when you’re up against it with kitchens and customers but it’s not that time consuming. There are tools that can help you automate a lot of this and keep an eye on the comments so that you can react pretty much in real time.

TwitAdvisor (deliberate spelling)– Again, I can see why this is important for some restaurants, but I would advise, don’t over fixate on this. Yes, there are plenty of genuine reviews but there’s also a lot of noise. Counter this with generating your own content on your own platforms. I’ve been sending this link to a lot of people – a garden shed serving bleach and ready meals from Iceland became the number 1 restaurant in London on TripAdvisor.

Discounts

We didn’t really cover this in any type of detail but here’s my tuppenceworth.

If you are going to rely on Groupon or Wowcher then your restaurant will have a very short shelf life unless it’s somewhere that doesn’t inspire repeat custom – like the hellhole that is Leicester Square.

As in retail, restaurants have their own discounters equivalents of Aldi and Lidl such as Pizza Express, Strada or Zizzi’s to name but 3, but Aldi and Lidl are also wooing away Waitrose customers too. Why?

There’s always going to be a cost to customer acquisition – whether it’s an offer, leaflets through your door or whether you advertise in the local paper. Aldi and Lidl offer well known brands at a discount, and they’re getting customers. As they get more customers, they get more purchasing power, more sites (sound familiar?) and then they specialize. They start offering really good wines and cheeses (and winning medals for them) and then your Waitrose customer gets interested because their prosecco is beating everyone else’s in blind taste testing. And they’re really smart because they instinctively know the Waitrose shopper wouldn’t be seen dead in one of their stores so they order online and suddenly they’ve got your email address and they can retarget you because they know you’re not buying baked beans in bulk but quality booze. Someone mentioned segmentation in the seminar – don’t knock it, it works.

Then Aldi and Lidl do event shopping – Italian month for example. My very good Italian friend always tells me when this is on as she says the products are excellent – and they are. You guys do the equivalent of event shopping too – Valentines, seasonal changes, Mother’s Day, Christmas Menus etc. These events are all born and live (or die) on word of mouth or social engagement.

So, discounts are one very good way of acquiring customers but you then have two challenges. How do I keep them and how do I not annoy my existing customers.

Keeping them is what you guys are good at – whether it was Paul from the Jolly Fine Pub Group patting your dog or someone else giving them a little plate from the chef and as for not annoying your existing loyal customers well that’s where segmentation comes in. In the old analogue days you’d know your customer and their likes/dislikes but how would you convey a message to them. By making them feel special – again, Kitty Fisher’s said that they had two mailing lists and they mailed the smaller one telling them about their offering – once again customer segmentation and retargeting. Not scary words when you put them in context. But you keep the customers not only through their stomachs, but also through their hearts and minds by reminding them of you at suitable opportunities – whether it’s a great photo or a recipe.

Why not invite a select group of customers to test out some new dishes, talk to the chef and they feel special and you’ll also get that much needed genuine feedback, never mind that pesky 10% discount floating around the web. Film quick talking heads of the customers and why they liked those dishes and also of the chef interacting with them. More people will want in next time.

One of AIR’s members is famous throughout theatreland – how about they sponsor a bursary for unpublished playwrights – it’s not the cash as such, it’s the intention and the social fame around it. I’d be willing to bet an awful lot of their customers have family members who are budding playwrights…. You just must think beyond hospitality.

I’m not saying forget the passion all the good stuff that makes you great restaurateurs (to me that’s a given) but ignore the social landscape and you will go the way of the dinosaurs, and that’s a fact.

As I said at the top, social engagement is just word of mouth amped up. Don’t be the last to find out what everyone’s saying about you.

Vikas Malik was marketing director of the Gate Restaurants from 2013-2017. He now heads Social Diners Restaurant PR & Consultancy where they specialize in helping independent restaurants play on a level field by disrupting the traditional restaurant PR model.

+44 7973 266751

hello@socialdiners.com

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