This blog post intends to look at the one night stand trap: restaurant diners customer lifetime value.

Restaurant diners can vaguely be split into two categories: one night stands and long term relationships.

The one night stands are only interested in their meal that night. They come along to your restaurant for a good time, not a long time, and tend to eat, drink and spend.

restaurant diners customer lifetime value

Long term relationships are customers who are known to you and your restaurant staff. They dine in your restaurant fairly regularly and have a favourite dish. They choose to come back to your restaurant because they know you and rate you and appreciate the familiarity.

The one night stand trap

There’s a good chance one night stands make up the bulk of your customer base so it’s understandable why restaurateurs tend to focus on them instead of the long term relationships.

Restaurateurs are also guilty of falling into the trap of chasing new one night stands instead of trying to turn the ones they’ve already had into long term relationships, or nurturing the long term relationships they already have.

And it is a trap. Because long term relationships are a lot more meaningful to your business, and can make you a lot more money, than you think.

Restaurant customer retention

According to the Gartner Group, 20 percent of existing customers will be the source of 80 percent of future profits and increasing customer retention rates by only 5 percent will increase profits by 25 to 95 percent

The next time you wave a one night stand out the door of your restaurant, think of these words: customer lifetime value.

Customer lifetime value of your restaurant diners

Customer lifetime value refers to the net profit from the entire future relationship with a customer.

So if a customer comes into your restaurant and spends £100 then comes back once a month for twenty years – that’s a potential customer lifetime value of £24,000.

Instead of putting £100 in your till that night then turning your attention to attracting tomorrow night’s guests, a bit of effort nurturing a relationship with the guest who just left could pay dividends.

Online feedback

So how do you go about building a long term relationship with your restaurant customers?

The obvious answer is to give them an excellent personalised customer service experience that will make them want to come back.

Another important factor of building a long term relationship with your restaurant customer is to monitor their feedback and respond to it. Reviews of your restaurant on TripAdvisor, Yelp, Twitter, etc, are a valuable resource of your customers experience. Did someone have a great time at your restaurant? Thank them personally. Did a customer have a valid complaint? Respond to it, take their criticism on board, and use it to make improvements to the way you run your business.

Responding personally to your customers online allows you to build a relationship of trust and loyalty.

How simpleERB can help

simpleERB makes it easier for restaurateurs to manage their online reviews and analyse their customer feedback.

We give you the option to add a link to your customer confirmation email which allows the customer to submit their thoughts to you after their meal.

This allows you to read your feedback directly from the customer and means you can respond to and deal with negative reviews before they reach review sites.

The features also encourages customers to share positive review on Yelp, Trip Advisor and Facebook (you’ll need to be logged into simpleERB to see).

simpleERB builds a complete record of all your customers and their preferences, ensuring that if Customer A is gluten intolerant and Customer B likes a seat by the window, you’ll be aware of this before they arrive at your restaurant and an create a personalised customer service experience.

simpleERB can help you boost boost the customer lifetime value of your restaurants diners.

Because while one night stands are fun, long term relationships are ultimately a lot more satisfying (and profitable).



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