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Getting your CRM and customer loyalty initiatives right is a crucial piece for all marketers, and especially for those in the restaurant industry.
Loyalty360 talked to William Jenkins, vice president, Loyalty, at Epsilon, to learn more about this compelling topic.
Domino’s and Epsilon will headline a session titled, “Creating Connections that Inspire Brand Loyalty,” at Loyalty360’s Customer Expo (Nov. 6-8, 2017) in Nashville.
How would you characterize the current state of CRM and loyalty in the restaurant space and how does this impact marketers?
Jenkins: Restaurant marketers are focused on identifying and obtaining a holistic view of their customers. They are trying to understand what motivates them, where they live, their lifestyles, and preferences. In the restaurant industry, there are multiple data silos, email clubs, SMSo clubs, and loyalty programs with each housing different data.
The ‘trick is’ to bring all the disparate sources together and that’s where CRM comes in. Serving as the centralized repository for the myriad of data, this is where the magic can happen for restaurants. We can put together those pieces and gain the holistic view of customers. The restaurant industry has made some significant strides in things like tying transactions to individuals. Restaurants are trying to centralize so they can take action on data to personalize, get to 1:1 marketing, and segment and get away from the ‘spray and pray’ or assumption marketing. It has a direct effect on loyalty because you can’t get the endearing relationships if you don’t know how to communicate to your guests with relevant content which will motivate them to frequent your location.
Consumer expectations are changing. There is a stronger preference for authenticity and instant gratification. Consumers today desire more personalization, unique one-of-a-kind experiences, and recognition by their favorite brands. In terms of expectations, there’s also a whole new aspect of delivery (pick up, curbside, catering order) and consumers have additional needs: They want consistent quality, more flavors, more choices. Additional competitors continue ‘to appear’ as more grocers, stores, etc., are ‘upping’ their games and entering the market in different categories (Blue Apron, Home Chef).
What are marketers doing well in this area and where do the challenges lie?
Jenkins: If you think about the addressable audience in terms of the budget being sourced, restaurants are spending more on mass audience versus addressable. Several are still in the adoption phase of digital and are starting to use more channels to connect with customers. For example, brands such as Domino’s and Dunkin’ Donuts are fully immersed in digital while others don’t even know who their customers are, but they are putting the right steps in place to ‘lay down the foundation’ (the strategy and technology applications) to completely understand their guests and how to engage with them. Substantial investments are underway as it relates to these marketers omnichannel and personalization efforts.
Is the restaurant space ahead of or behind other segments in the loyalty industry when it comes to CRM and loyalty efforts?
Jenkins: Overall, I would say behind, but not for long. Restaurant marketers are finally starting to allocate budgets to customer engagement, loyalty platforms, and data (third-party) and are embracing technology. However, they are behind in terms of getting the technology infrastructure in place. The restaurant vertical as a whole has invested in loyalty because they understand the power of it–to increase frequency, spend, and lapsed customers. They will soon catch-up with industries such as retail, travel, and hospitality. They were later adapters of formalized loyalty programs as their ongoing and award-winning customer service has ‘acted like’ a loyalty program for years, but they sure are making strides.
What trends do you see that are connected to CRM and loyalty in the restaurant space?
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