With the continued collapse of restaurant chains in the UK, it seems even the industry’s key players are struggling to stay afloat and retain loyal customers.
The future isn’t looking too bright with forecasts suggesting that even more restaurant chains and independent brick-and-mortar stores will issue profit warnings and closures in the coming months.
A few of these businesses are now launching or restructuring their loyalty programs in order to increase customer retention and give people a reason to return. But the question is whether customers really will show brand loyalty at a time when each business has no shortage of competitors.
As seen on Casual Dining Magazine, research by Como for the UK market reveals that loyalty programs do work. The figures show that loyal customers redeem a gift on average every 9.4 days, and it takes a loyalty program member an average of 59 days to complete and redeem a digital punch card. With punch cards usually requiring 10 purchases before a reward is offered, the method could bring customers back at least once a week.
VIP Members Spend 153% More. The data, which analyzed customer behavior in more than 400 stores across the UK, revealed that 6.45% of loyal customers qualify as “champion” members, spending 153% more and visiting 30% more often than other customers, on average. They also facilitate a staggering 14.3% of overall members sales.
Como’s data also showed that Monday was the slowest day of the week in June, with sales down 41.7% compared to the daily average, while Saturday was the busiest day for sales, up 79.3% on average. Over the last three months, average visits were 112.4% higher during the weekend compared to weekdays.
Como also reveals that UK customers show complete loyalty to a business where they are members of their program. Overall, 94% of members are loyal to just one location of a chain, meaning just 6% are buying from a business in more than one of its locations.
“A lot of people are still under the impression that loyalty programs don’t work, that they’re just another piece of plastic taking up space in your pocket. But our internal data proves that loyalty do work, and consumers are rewarded on average every 9.4 days. Retaining customers in the digital age of fierce competition is even more important than winning new customers as they bring in more value and revenue and it requires a mix of exclusivity, personalization, and engagement.” – Liran Mayost
This research is based on the Business Insights feature, available from Como’s recently revamped dashboard. The Business Insights feature and newly added Recommendation Engine uses machine learning technology to automatically explore any business information, enabling the business to gain top data highlights and smart recommendations that are tailored to their specific needs and goals.
Como is a customer engagement tool that integrates with your POS system to provide restaurants and business chains customer insights and omnichannel engagement tools. Start engaging with your customers on a more personalized level for to increase brand loyalty, customer retention, and sales growth.
Want to learn more about how Como delivers actionable insights and personalized engagement tools for your business? Contact us or request a demo to get in touch with our team.
Additional References to Como Research: