What is CRM and Why is it So Important to Restaurant Businesses and Customer Retention?

CRM – What is It?

Before we delve into why CRM (customer relationship management) is such a powerful tool to help restaurants retain customers, we’ll explain exactly what it is. CRM, or (crm 系統 in Hong Kong), is a tech system that manages all of your customers and their interactions with your restaurant. A typical restaurant CRM system will help with contact management, sales management, customer data management, loyalty programs, productivity and more. 

The Main Goal of CRM is to Ensure that Your Restaurant can Achieve 4 Key Things:

1. Stay connected with customers – even after they leave your restaurant

2. Streamline all your restaurant’s customer-related processes

3. Boost profitability by giving you an in-depth understanding of your customers

4. Most importantly, achieve a higher rate of repeat customer visits

Why is CRM so Important to Restaurants?

The key reason that CRM is incredibly important to restaurant businesses is because it helps bring customers back. Repeat business is something that restaurants strive to achieve, but without a good CRM system, most restaurants fall short of the mark. 

70% of restaurant customers don’t return after their first visit. This means that only 30% of customers are the biggest revenue generators and driving higher margins for restaurants. This puts a lot of pressure on restaurants to retain that 30% of customers. 

Fortunately, a solid restaurant CRM system can help boost those numbers significantly. 

5 Ways CRM Can Help Drive Business and Bring Back Customers

Let’s take a look at a few of the key ways in which restaurant CRM can actually encourage repeat customers and help drive your restaurant’s profits. Remember, increasing your repeat customer rate by just 5% can boost profits by up to 25%, or even higher!

1. Customer Data Organization and Storage

Having information about your customers is super important for a restaurant. A CRM system helps you keep track of things like a customer’s name, their phone number, email address, birthday, anniversary date, company details, dietary requirements and much more. By building up a strong profile for each customer that visits your restaurant, you can offer them the best service and make their visit extra-special. Customers that have a great time at your restaurant are far more likely to return.

2. Keep Track of Guest Visits and Purchases

Knowing when your repeat guests visit and what kinds of purchases they make is another key element in building up your CRM profile for each customer. If you know their average spend and the types of items they usually order, your wait staff can make tailored suggestions that these guests might enjoy. This kind of relevant, personal treatment is a great way to also ensure repeat business.

3. Targeted Marketing

The data collected through your restaurant’s CRM can help with targeted marketing. If you’re having specific promotions or are pushing new items, it’s far more effective to email customers with items that will appeal to them. For example, if you know the dietary requirements of your customers, you can push new vegetarian options to customers who are vegetarian. Being able to bump your email marketing to the next level is a guaranteed way that your CRM can increase repeat business.

4. Loyalty Systems

We’ve all been to big chains like Starbucks, where loyalty systems are the norm. Customers feel a sense of belonging and value when they become part of a loyalty program. These programs utilize CRM to give customers discounts and rewards based on…you guessed it, repeat visits and purchases! Setting up a loyalty system that rewards repeat businesses is honestly one of the best ways to encourage repeat business – all while also building up your brand loyalty!

The definitive guide to loyalty programs and how to implement them

5. Track Performance Metrics

Alongside having information about which of your customers dined at your restaurant, and how often they visited, you can also keep track of other important data points like which dishes were ordered the most by customers. This type of information can be a great measurement tool when it comes to streamlining or tweaking your menu. If your business has extensive CRM data spanning back a few years, you could even spot trends – like which food and drink items are popular in summer and winter. Once you understand your customers and spot trends, act upon them and switch up your menus to reflect the patterns you find. It’ll let customers know you’re listening to them and will also ensure all their favorite items are on your menu – a key way to bring customers back for more!

Grow Your Business and Your Customers with Restaurant CRM

Increasing your repeat customers by just 5 percent could mean that your restaurant sees profits soar by 25 percent, making CRM is an absolute must. In these uncertain times, it’s important that restaurants are able to grow their customer base and keep cashflow as high as possible. 

CRM is especially potent when integrated directly into your restaurant’s POS system. Cloud-based POS systems often come with CRM inbuilt or have third-party integrations whereby you can choose the specific type of CRM features that will help your business shine.