Building customer loyalty is the key to long term success. There are lots of ways to try to build loyalty, but not all of them will work for you. Marketing campaigns can be expensive, so you’ve got to measure your results to know which to keep investing in.
We have lots of sophisticated “metrics” to measure loyalty (Net Promoter Score, Customer Loyalty Index, Customer Engagement Score) but they’re
- More complicated, and
- Less accurate
than this simple way to measure your customers’ loyalty.
Building Customer Loyalty: what to look at
Loyalty is simple: your customers keep coming back month after month, season after season. You help them for years. You get to really know each other. There are easy ways to measure which of your customers are loyal to you, and which marketing activities help you build loyalty best.
- Repeat business: the simplest measure. When you own a Pizzeria and the Smith family orders a pizza every Friday night, they’re demonstrating that they like your product, your service, and the value you offer.
- Upselling: or simply “selling more.” If the Smith’s start placing orders for other nights than Friday, that’s a measure of success.
- Add on sales: If the Smith’s always order pizza and start adding on a side salad or dessert, that’s another good measure of success. Keep suggesting new add-ons.
- Cross Marketing: here’s where more profits can be made: you know the Smith’s will order a pizza. But your profit for your Supreme Pizza, or Chicken Parmesan, is twice as much. Giving them a reason to switch their order to a premium menu item broadens your appeal, and gives them even more reasons to stay keep ordering from you (being loyal). Let customers know that you have more to offer. Congratulations.
You can measure them
It doesn’t take much to capture this kind of information, to keep track of your customers. And the benefits that knowing your customers better far outweigh the cost.
Most Pizzerias Miss the Boat
Think about your Pizzeria. They may actually recognize you when you come in to pick up your pie. But that’s often as far as it goes. Friday is their busiest night of the week, and the line (in my town) is often “out the door.” So they work on efficiency rather than hospitality.
They miss the opportunity to build loyalty in any of these ways, and others as well.
Other opportunities missed
Here are 5 more ways to build loyalty. When you see them, you can measure them, and that means you can improve them.
- Referrals: nothing beats a personal referral. When the Smiths recommend your pizzeria to their neighbors, its better than any other advertising you have.
- Social Media: when your customers post on your Facebook or other Social Media sites, their friends and family see it, and it can help you attract more business
- Loyalty programs: can be as distinctive as a “punch card” that hangs on a keychain. It motivates your customer to only buy their pizza from you, and others see your name and logo, and are influenced to buy their pizza from you next Friday.
- Get Personal: everybody likes to be recognized, and feel special: at the very least, you’ll see their name when you “run” their credit card. Why not just say “Thanks for coming back, Mr. Smith”?
- Use data: when you collect data about your customers, you’ll know their buying patterns and frequency. If they only buy on Friday nights, offer a special coupon for a “Mangia Monday” Special: 15% off your total order. It’s a win-win opportunity, because it opens the possibility of seeing the Smith’s in your pizzeria on other days of the week.
All businesses need loyal customers
This isn’t really about Pizzerias at all. But since Pizza is America’s fourth most popular food it was easy to use as example. Actually this was all about your business, food or non-food.
Try the easy marketing ideas first.
Some of these ideas are easier to use than others. You can hand out coupons for “Mangia Monday.” You can SMS text many of the phone numbers that call you. You can offer discounts when you ask for email addresses and send menus and coupons and specials, and you can “upsell,” “cross market,” and promote other ideas with your messages on hold.
The secret is to try one or more of them. Today.