Why Loyalty Matters for Restaurants

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Why Loyalty Matters


~2/3 of restaurant sales comes from just 25% of

customers

62%19%

14%

5%

TOP

2ND

3RD

BOTTOM

69% of loyal restaurant guests haven’t returned in

the last 4 months

SUPER LOYAL REGULARS

AT-RISK

W H A T W E K N O W A B O U T T H E R E S T A U R A N T I N D U S T R Y

M O D E R N R E S TA U R A N T G U E S T S A R E “ P R O M I S C U O U S ”


W H A T W E ’ R E S E E I N G A C R O S ST H E I N D U S T R Y

• The 80/20 rule is true and becoming more concentrated

• Nearly 70% of revenue comes from just 20-25% of customers – loyalists have other options and are mission critical for same store sales growth

• Millennials (18-35) are the largest spending demographic in US history and a force to be reckoned with

• Millennials spent ~$100B at restaurants in 2015

• Single largest growing spending demographic in US (passed Baby Boomers in 2016) and growing double digits annually

• On average, millennials spend 3+ hours per day on their phone and for 87% of them, their phone is within two feet of them for 24 hours / day

• Email is rapidly becoming a less effective channel

• Email open rates down to 4% (down 20% from a few years back)

• Click rates average 1.7% in restaurants and conversion to revenue even lower

• Poor mobile app ratings degrade overall brand value

• Majority of restaurant/retail apps are <3 stars = brand destroyer among younger demo


“C U S TO M E R R E T E N T I O N ” I S I N C R E D I B LY P O W E R F U L

F R E D R E I C H H E L D

Bain Fellow Founder of Bain’s Loyalty Practice

a 5% increase in customer retention produces a

100% increase in annual profit

“

”


B U T M O S T LOYA LT Y P RO G R A M S A R E FA I L I N G

Loyalty program memberships have grown to an all-time high…

2.6B3.3B

2012

2014 +26%GROWTH

Source: COLLOQUY

…But out of 29 loyalty program memberships per U.S. household, 59%(!) are inactive.

59%


AND EMAIL IS NOT A VIABLE LONG-TERM ENGAGEMENT STRATEGY

AVERAGE EMAIL ENGAGEMENT/CLICKTHROUGH RATE 2015

3.6% 1.7%(RESTAURANT - SPECIFIC)

0%2%4%6%

Q1 2013 Q3 2013 Q1 2014 Q3 2014 Q1 2015

Q1 2013 - Q2 2015 EMAIL ENGAGEMENT/CLICKTHROUGH RATE


Design and product teams made

up of alumni from leading tech

and data analytics companies

Founded in 2011 in San

Francisco with nearly $10M in

funding from elite investors

W E A R E C U S T O M E R E X P E R I E N C E A N D A N A LY T I C S E X P E R T S …

… W H O D I F F E R E N T I AT E O N R E S U LT S

99% renewals 2-6% same-store sales growth

>500% ROI

Focusing on multi-location

retailers and restaurants with

hundreds of clients in 40+ states


THANX WORKS WITH 1000S OF RESTAURANTS ACROSS THE U.S.

Watch our merchant partner video testimonials at thanx.com/customers

Why Loyalty Matters for Restaurants

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