For some time, restaurant marketers have lagged behind their peers in retail and ecommerce when it comes to performance marketing. They can’t “connect the dots” between their marketing programs and the revenue these efforts generate, nor do they have the data to refine campaigns for optimal return on investment. This is largely because the restaurant industry has lacked two things: the “plumbing” and the playbook. Fishbowl’s VP of CRM and Loyalty Analytics, Helen Baptist, talks about the lessons learned from the ecommerce and retail experience and how to apply them to the restaurant industry.
“Restaurant chains need to put the right ‘plumbing’ in place to understand their guests,” Helen says. “At one level, marketers need to track offers and redemptions to know whether they have the right couponing strategy and to determine campaign ROI. At a broader level, they need to combine member, demographic, and transactional data to get a comprehensive view of guest behavior. Since most of that data is in silos, the latter is the ultimate ‘connect the dots’ challenge.”
Connecting the dots requires more than having the right plumbing. To drive predictable sales growth, restaurant marketers also need a playbook that helps them understand how to use their data to make better decisions about their programs. Helen emphasizes that performance marketing requires a focus on all guests, not just eClub or loyalty members. For example, if you know how many of your customers dine with you just once a year, you can develop a strategy around frequency.
“Preliminary Fishbowl Loyalty Analytics data has revealed some common themes,” Helen says. “ To take one metric, 75% of all guests dine only once per year in the casual dine category. These diners represent 52% of total sales. Think about the implications of that – half of your total annual sales are driven by one time guests. Can you afford to ignore them or how do you find them again next year?”
“Now look at our data on eClub members and other guests for whom we have contact information and can communicate with on a 1:1 basis. Those numbers are 60% and 42% respectively. This confirms that marketable guests are more valuable and suggests that marketers need to focus on building meaningful relationships with guests. There is an opportunity here to gain greater frequency and less risk of losing sales if you do that.”
“Performance marketing has long been tablestakes in the retail and ecommerce sectors,” Helen notes. She points out that some of the problems that flummox marketers today – particularly the challenge of establishing the ROI of various channels or being able to measure customer life cycle value – can be solved with a performance marketing infrastructure and strategy. Marketers can leverage their knowledge of guest performance to build and refine segmented marketing programs. And once they understand their guests’ behavior, they can influence it to drive more revenue across the board.