The strategy is simple: Give high-paying customers an incentive and they’ll come back and buy more.
That way, you boost sales, find new customers through referrals and lower your costs of marketing and customer acquisition.
So how do you accomplish this? By figuring out who your best customers are and what motivates them to buy. Once you know that, you can add incentives to make it worth their while to buy more.
What you need to realize regarding loyalty programs is that while they do decrease your earnings in the short term, they will increase them in the long term. When a loyalty program is put into place, you will find that the number of bums on seats will go up.
I have seen many restaurants with Loyalty programs and discount offers trying to entice new entrants to their market base. But why do we reward the newest customers? Why don’t we introduce rewards to give our regular customers better deals to reinforce the loyalty?
I don’t object to giving a meal away or buying a drink for a customer, the emphasis is that I (the owner, manager,) will participate in the offer and explain why I value the customer and explain the reward that I’m sharing. This has far more impact on the relationship with the customer as opposed to a frequent Diner Card, which represents a transaction and eliminates all personal contact.
The best form of advertising is keeping your loyal customers happy, they will introduce many of their friends and family. Word of mouth is the most powerful tool you have.