When a restaurant owner like you sign up for my monthly magazine (and get a gift from me), I will ask the following questions in the registration form:
As a restaurant owner/manager, what is your biggest challenge? Here are the top answers for a large number of restaurant owners per month:
Bring new customers to my restaurant.
Sounds like a logical answer, right? Who doesn’t want to let a lot of new people come in? However, if I continue to run my restaurant, the marketing method I know today is my wish/challenge will be different. It would be like this:
I hope that my current customers will return to my restaurant again and again.
Does this mean that I don’t want new customers? Of course, new customers are new opportunities to become loyal customers, but guiding your marketing efforts to get new customers should not offset most of your costs or efforts. So what should you do?
I will introduce you to a hypothetical exercise:
Imagine we have two restaurants with similar capacities. We call them Restaurant A and Restaurant B.
For the sake of simplicity, we assume that the following parameters are common to both restaurants:
- The average price per meal is $25.
- The profit margin of food is $10.
- The marketing investment for both is $5,000.
The differences are as follows:
A restaurant invests once every $5,000 to attract new customers. They put money into a very successful event and made coupons, letters, etc. When they spent $5,000 on marketing, they brought 1,000 new customers to their restaurants. Very good, right? $5 per customer is a very low investment to attract new customers.
Restaurant B does things differently. They spend the same amount ($5,000), but instead of spending the full budget to attract new customers through advertising, they decide to put all their money into existing customers and come back again and again. They also motivate their friends and family so they can also enter and try their restaurant.
Will you do better? We will make numbers.
Restaurant A invested $5,000 and brought in 1,000 people, each of whom will make a profit of $10. As a result, their total profit is $10,000 and their return on investment is 50%. not bad.
Restaurant B focuses on serving existing customers through a formal recommendation system. They gave them 100 best customers four gift vouchers: one allowed them to come back, the other three, so they could give them to their friends and family so they could try their own restaurant. These vouchers allow them to enjoy a 50% discount (Wolt Rabattkod) on all food items.
Keep in mind that, as mentioned above, the average meal for restaurant B is only $15, as the remaining $10 represents a profit. If it offers a 50% discount (Wolt Rabattkod), the cost per meal is $7.50.
Also, when you offer someone a gift certificate, it may not go home alone. Most likely, they took the company to eat. Suppose he gives up every $12.50 (50% of the average food price) and returns two people. The cost per person is now $3.75. Wow! It is even better than the initial investment. But this is not all, there are three things happening here:
If people don’t use gift certificates when they eat, they won’t lose money, making this investment a safe investment.
New visitors will tend to love you; after all, your restaurant has always been recommended by trusted sources, more than any other restaurant critic: your friends or family will give you a gift certificate. If your restaurant offers quality food and service, they are likely to come back because they feel that they not only have discounts (Wolt Rabattkod 2019), but also give them a gift certificate and three gift vouchers. Other people are their friends. Prove your location.