How to Increase Profitability by Building Customer Retention

Jenny Day
Jenny Day
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Anyone in the restaurant industry has felt the satisfaction of seeing your loyal customers walk through their doors – it’s the feeling of appreciation and gratitude. Those feelings are well-placed because those return customers spend an astonishing 67 percent more than a new customer during a visit!

Why is it important to increase customer retention?

Building a customer retention program is important for improving the lifetime value of current customers, which can make up a large portion of your restaurant’s revenue. Customer retention statistics show that 65% of a company’s business comes from their existing customer base. And as an added bonus, customer loyalty helps bring in new customers since happy customers are more likely to recommend your product or service to others.

What is a good retention rate in the restaurant industry?

Looking at the average customer retention rate by industry, the restaurant industry isn’t one of the top examples. These are taken by media (84%), insurance (83%), IT services (81%), telecom (78%), banking (75%), and retail (63%).

The restaurant customer retention rate sits at about 30%, which also means that more or less 70% of customers don’t come back to the same restaurant after visiting it once. This is why customer we need customer retention strategies for restaurants specifically.

82% of companies agree that customer retention costs are cheaper than new customer acquisition. Once you have conquered getting the customer through the front door, customer retention management seems like a no-brainer, especially with these customer retention examples:

Make sure your restaurant offers a consistent, high-quality experience

STAT: Prompt customer service and quick remedies to problems play a role in consumers sticking to a brand. 82% of them remain loyal to the brand when these standards are met.

Consistency is king in customer retention. Make sure your customers are receiving the same experience and products that they received the first time they visited your restaurant.

More times than not, customers return to a restaurant to quench a craving. If that item was enjoyed the first time, most likely the customer will return for that very same item and experience again. This means ensuring that you keep popular items on your menu and are enforcing adherence to the recipe. However, less obvious factors should not be overlooked. You should also maintain the presentation of the dishes, the cleanliness of the venue and the quality of service.

Make sure all restaurant staff is properly trained

STAT: 89% of businesses claiming that customer service is a leading factor in their company’s retention rates.

Chances are you have had an awful service experience in a restaurant or bar. Perhaps the bathrooms were dirty. Or your server was unfriendly. Or the food took unusually long to come out.

These instances can be very detrimental when it comes to getting your customers to return. You should take the time to make sure that employees are properly trained, and that you clarify your expectations on customer engagement, cleanliness, and ticket times. Teach them to leave their baggage at the door and to come to work with a positive attitude. Staff that appears knowledgeable and effective will, without a doubt, be recognized by your customers.

Create loyalty programs, incentives, and special deals

STAT: To continue their purchases with a business, 83% of consumers think that signing up with a rewards program can help. 75% of consumers say they favor companies that offer rewards.

Incentives and loyalty programs are becoming increasingly popular, especially amongst the millennial crowd. As this crowd’s lifestyle is cultured around social media and technology, many incentive programs can be done simply through e-mail or text messages.

Punch cards, coupons, point systems, and even exclusive products can also keep your customers coming back. Incentives and loyalty programs are relatively inexpensive in relation to the cost of acquiring new customers through marketing and advertisement.

Be Seen

STAT: 43% of customers are likely to leave a review after a positive customer experience.

As restaurant owners and managers, engaging customers is a hhuge part of customer satisfaction. Customers like to see who they are giving their money to. Don’t let burdensome paperwork keep you in the back office when you could be conducting table visits.

Customers remember these small gestures. It may take a moment or two out of your busy day, but the results of that gesture can be extremely valuable the next time those customers are deciding on where to eat out or suggest to a friend.

Support your community

STAT: Community involvement is an easy and effective way to increase brand awareness, establish a positive reputation, and grow repeat business.

Giving back to your community among the top customer retention strategies for small businesses because it is a great way to grow your brand by showcasing your business values. You can find ways to get involved in community events, donate to nonprofits, provide free services to schools and local charities.

Aside from donating and sponsoring, you can also look internally and promote socially responsible business practices such as purchasing supplies from local vendors or giving employees paid time to volunteer.


The ability to attract new customers and retain loyal guests can be a struggle for operators. That’s where Restaurant365 can help. We’ve been in your shoes.

We know that it takes more than technology to run a successful restaurant. Many of our staff has worked in the restaurant industry and have seen first-hand the type of service, attention to detail, and experience it takes to satisfy customers’ evolving needs.

Our back-office management solutions cover accountingpayrollschedulinginventorymanager logbook, and more to give you the insights and intelligence to identify what’s working and what’s not. You can see which recipes are most profitable. You can optimize food usage and reduce waste. You can figure out which servers are outperforming on upsell—and who might need a little nudge.

Find out how Restaurant365 can help you use technology to deliver on customer expectation.

Schedule a free demo of Restaurant365 today.