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The Four Questions You Must Answer to Understand Guest Loyalty

post_helenHelen Baptist, Fishbowl’s Vice President CRM, is an experienced practitioner of CRM and loyalty solutions across multiple industries.  In previous positions within the ecommerce, travel and food businesses, she developed customer engagement strategies based on loyalty best practices, designed acquisition and retention programs that drove double digit sales increases, and launched award winning Loyalty Programs.  When Helen joined Fishbowl, she leveraged this experience to drive forward Fishbowl’s Loyalty Analytics solution, a combination of software and services built on various CRM methodologies.

Helen knew from the beginning that Fishbowl’s solution had to be based on the proven data-driven system employed in the ecommerce and retail industries, in which merchants use prior purchase behavior to drive recommendations, messaging, and sales.  “The whole point,” she says, “is to leverage customer engagement, insights, and metrics to drive strategy, revenues, and marketing efforts.” But where do you start?

We had Helen walk us through the process of systematically engendering loyalty through guest purchase and marketing performance data analytics. Designing a loyalty solution, to her, is essentially mapping out a guest journey and then quantifying and delivering the net revenue lift potential against current guest performance.  She begins by asking restaurant marketers four questions:

  1. Do you know if your guests behave in your restaurant the way they say they do through customer research? 
  2. Do you know what levers to pull to change their behavior to get more from them?
  3. Do you know what percentage of your revenue comes from a specific guest segment?
  4. Can you track revenue contribution and performance of your marketing efforts at the individual guest level?

loyalty_1For every restaurant marketer, the first question is a matter of urgency. You have to understand your guests’ behavior today.  At Fishbowl, we define baseline guest behavior as how recently your guests have been in your stores, how frequently they visit, and how much they have spent in the last 12 months.  This data is the basis for guest segmentation and the point from which to measure net lift in comp store sales.

 

loyalty_2Once you have a basic understanding of your customers, you can segment them along those parameters – by recency, frequency, and spend along with other factors such as how they responded to prior 1:1 marketing efforts. “The goal is to build marketing programs that foster meaningful relationships for each segment,” Helen says.  By engaging guests in a dialogue based on preferences, you have the opportunity to change their behavior – to proactively drive increased visits and incremental revenues.

loyalty_3

 

As you market to the segments you’ve identified, the guest data you collect should be used to drive your next marketing efforts – it’s like an ongoing learning loop that you continue to refine and optimize. Though the initial steps are important, it’s the continuous engagement through marketing, measurement of results and optimization of both that builds guest loyalty.  The Fishbowl solution gives you the opportunity to prioritize how to best engage all of your guests in the most optimal way possible, whether they are members of an eClub, a loyalty program, or other lists of guests you have permission to market to on a 1:1 basis. This is how you reach the holy grail of predictable revenues.