Diner Devotion: Building a Remote-Worker Friendly Loyalty Program for your Small Restaurant

Copyright ©  2023 AlgoRhythms Studios, Ltd. 

All rights reserved.

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DISCLAIMER. This publication is intended (but not guaranteed) to provide accurate information in regard to the subject matter covered.  Some information may not be applicable to every reader or every situation.  It is sold with the understanding that neither the author, publisher nor any other person or entity connected with the creation, publication or distribution of this publication provides legal, accounting, real estate or other professional services.  If expert assistance is required, the services of a competent professional should be sought. Furthermore, this publication may contain business strategies, marketing methods, and other statements that, regardless of the experiences of some, may not produce the same results for you. The author, publisher, and all parties engaged in the creation and distribution of this publication make absolutely no guarantee, expressed or implied, that by following the statements in this publication you will make any money or improve current profits, as there are several factors and variables that come into play regarding any given business. Results will depend on your business model, the conditions of the marketplace, the experience of the individual, and situations and elements that are beyond your control. As with any business endeavor, you assume all risk related to investment and money based on your own discretion and at your own potential expense.

PRINT ISBN: 979-8-9854158-6-5

E-BOOK ISBN: 979-8-9854158-7-2

Library of Congress Control Number: 2023915967

Printed in the United States of America

Dedication

To Mom, for instilling a love of food that has endured to this day.

To my amazing children, for patiently raising me as I raised you.

To Nita, for never allowing me to give up.

To Rob, for making me laugh through the pain of life.

To Prentice, for never hiding the good bourbon when we chat about ideas.

To the rest of my friends . . .

Thank you for your love and kindness over the years.

Friendship improves happiness, and abates misery, by doubling our joys, and dividing our grief

— Marcus Tullius Cicero

To all of the small, local independent restaurant owners . . .

Thank you for giving our lives a bit more flavor!

Food is our common ground, a universal experience.

— James Beard

Table of Contents

SECTION 1

1.The World Changed . . . Didn’t You Get the Memo?

2.What Is a Loyalty Program, Anyway?

SECTION 2

3.Introduction to Planning Your Loyalty Program

4.Choosing the Right Loyalty Program

5.Assessing Scalability, Flexibility, and Appeal

6.Determining Rewards and Program Mechanics

SECTION 3

7.Utilize Digital Marketing Strategies for Promotion

8.Collaborate to Promote Your Loyalty Program

9.Adding Referral Incentives

SECTION 4

10.Designing an Effective Points-Based Program

11.Communicating Value & Points Accumulation

SECTION 5

12.The ‘Geeky Stuff’ - Track & Measure Performance with KPIs and Analytics

13.What Do Your Customers Really Think About Your Loyalty Program?

14.Scaling Your Loyalty Program and Expanding its Reach

SECTION 6

15.Final Thoughts and Contact Information

Endnotes

Also By Donovan Garett

SECTION 1

Introduction and Welcome

In this section, we get to know each other a bit, and we set the stage for our journey together. We begin with a cursory glance at just how much the world has changed in the last 5 years or so, and the effect that this has had on small local independent restaurants. We introduce the concept of a loyalty program and highlight the benefits of implementing this strategy to boost your restaurant's bottom line.

Chapter 1

The World Changed . . . Didn’t You Get the Memo?

Change is the law of life. And those who look only to the past or the present are certain to miss the future.

John F. Kennedy

FIRST AND FOREMOST, I sincerely appreciate you taking a chance and buying this book. It’s taken quite a bit of research, early mornings, long nights, oh . . . and quite a few sips of bourbon to get here.

Let me start by explaining why I’m so passionate about supporting small, local independent restaurants like yours. It is because they represent something more than just a meal, or a place to eat. As a society, we commonly express our emotions through food. We even define our cultural heritage and identity by the foods we prepare and share with our closest family and friends.

Simply put, small restaurants are the heart and soul of our communities. Aside from the economic value they provide, they’re a way to sample another culture without the overhead of learning a new language or traveling around the world. In many ways, they provide a semblance of unity in a bitterly divided world.

Today, small local independent restaurants are in crisis. In fact, most small restaurant owners don’t realize just how much the world has changed within the past five years or so. While the core operating model for restaurants has remained pretty much the same, everything else needed to support that model is radically different now.

In this chapter, we’ll briefly touch on some of the ways that the COVID-19 pandemic represented a tectonic shift in society, and how that shift affects your restaurant. We’ll also discuss why these changes necessitate a fresh way of thinking about your business, your customers, and how to reach them.

Before we begin though, I’m going to do a little shameless self-promotion. Many of the concepts that are only briefly touched on or skimmed over in this book are discussed in great detail in "The Ultimate Guide to Restaurant Marketing in a Post-Covid, Work-from-Home World" Go ahead and pick up a copy.

Okay. Let’s get started.

Welcome to the Post-Pandemic World

Let me begin by stating the obvious. Our world is totally different than what it was a few years ago. Duh, right? As I sit down to write this book in mid-2023, the world just "feels different." There is an imperceptible uneasiness, constant uncertainty, and persistent fear that most people feel about the future.

To be sure, times certainly have changed. However, rather than do nothing, your mindset, and strategy must change also. This is where most small restaurant owners fail. They simply refuse to change their thinking and adapt to the times. They feel that they can continue running their business the same way they did in the 1980s, 1990s, and early 2000s – no marketing, no advertising, no website, no social media.

The result? . . . No customers.

How the COVID-19 Pandemic Changed Us All

In a very real sense, the COVID-19 pandemic showed us who we really are as a society. We hate economic pain, and we crave comfort and convenience. The U.S. Government's stimulus packages helped relieve some amount of economic pain for many, but not all. At the same time, the prolific rise of food delivery platforms such as DoorDash, GrubHub, and UberEats granted us comfort and convenience by allowing us to dine on our terms by having food delivered to our doorstep.

The point is that consumer preferences, behaviors, and expectations have changed significantly. Let me illustrate this with a recent experience. I’m old enough to remember the 1980s vividly. As a kid, we’d receive a Sears or JCPenny catalog in the mail every 6 months or so. This thing was massive – over 1,200 pages, nearly 3 inches thick. Now, I’m not ashamed to admit that I grew up poor, but every so often my mom would order something from the catalog. It didn’t really matter what it was – drapes, kitchen bowls, or the occasional toy – we’d be in anxious excitement . . . waiting 6 to 8 weeks for it to arrive.

Fast forward to 2023, and I recently ordered something from Amazon using 1-day shipping. It arrived late, and I found myself getting upset that I couldn’t get my items within a day of ordering them. I mean . . . 'how dare they delay my order.' I finally had to stop myself and I started laughing hysterically because I was amazed at just how much my own expectations had changed. From happily willing to wait 8 weeks, to being frustrated at having to wait 2 days.

I'm sure that I'm not alone in thinking this way. This is the world we now live in. Technology is disrupting every industry imaginable. As a result, customer expectations are changing. Today, customers expect you to find them – because they are not driving around the neighborhood aimlessly looking for your restaurant. They expect to find you online, on social media, in their feed, and on their delivery apps. This is the fundamental mindset shift that many small restaurant owners just don’t get.

The Rise of Remote Work and Its Impact on Small Restaurants

The second fundamental shift has to do with the physical location of your customers. For decades, commercial realtors, banks, and leading restaurant planning experts tied much of the success of a new restaurant to its physical proximity to people (i.e., foot traffic).

For example, strip malls near large office complexes, hospitals, and other densely populated commercial real estate commanded higher lease prices because they were in close physical proximity to places where people congregated. Likewise, malls were historically very expensive places to open up a restaurant, but the owners and investors knew they had a steady stream of hungry diners constantly shopping at the mall and happily paid the premium leasing fees that matched the location.

Today, this is no longer the case. Office buildings are seeing rising vacancy rates – even in densely populated cities, and shopping malls have become a fraction of what they once were. Don’t believe me? Head over to your local mall and look at how many vacant spots there are.

Now of course, there are some exceptions like hospitals, which still get quite a bit of foot traffic around them – but even hospitals are now opting for in-house vendors rather than the traditional cafeteria-only model. Thus, taking business away from surrounding restaurants. Foot traffic and patterns have changed.

More notably, the COVID-19 pandemic forced companies of all sizes to adopt a hybrid work model. This accelerated a trend that was already gaining popularity. While many jobs still rely on physical presence, others don’t. The percentage of workers who prefer a more flexible work model is growing steadily.

It is important to understand that the mind of a successful, remote worker is much different from a traditional office worker. Remote workers value being productive more than being seen. They are highly sensitive to time and generally want to add as much value as possible without the overhead of a stressful morning commute, water-cooler small talk, office politics, and the forced socialization that the traditional office environment requires.

As such, it is much harder to reach them if your restaurant is not in close physical proximity to where they live. So, you must change your strategy. You must either reach them online or make your restaurant an oasis, a place they want to go to for a change of scenery during non-peak hours or to relax with friends and family after work.

Marketing is No Longer a Luxury

Today’s diners are bombarded daily with an onslaught of marketing messages – including those from larger, chain restaurants. It is becoming increasingly difficult to capture and retain the attention of the people you want to attract to your restaurant. Couple this with the ever-rising numbers of remote workers in the U.S., and you quickly begin to grasp that people are no longer just out and about with no purpose. Therefore, simply opening up shop is not enough.

As you well know, competition is fierce among small restaurants. Your business faces unique challenges that require strategic planning and effective marketing to thrive in this environment. Understanding the importance of strategic marketing will help you navigate the market more efficiently, optimize your resources, and build a loyal customer base that provides predictable revenue streams – even during recessions.

Thus, it is imperative to have a clear roadmap that aligns your marketing efforts with your long-term business goals. By clearly understanding the benefits of having a marketing strategy tailored to the unique needs of your restaurant, you can position it for growth, profitability, and long-term success.

As we continue through the book, we will not only focus on loyalty programs themselves but also on how loyalty programs complement other marketing tactics, providing a comprehensive framework and a set of practical tools to help you achieve your business objectives.

Benefits of Having a

Comprehensive Marketing Strategy

First off, a comprehensive marketing strategy focuses on customer retention and loyalty, which are vital for long-term profitability. By creating and nurturing strong relationships with your customers, you encourage them to become regulars – thus increasing the likelihood of repeat visits and higher overall Customer Lifetime Value (CLV).

An effective marketing strategy also allows you to optimize your (often) limited resources. Smaller restaurants generally have limited budgets for marketing and advertising. By correctly identifying your target market segments and understanding their preferences and behaviors, you can tailor your marketing efforts to reach the most relevant audience, ensuring that your resources are used efficiently and effectively.

Furthermore, a well-defined marketing strategy provides you with a competitive advantage. By establishing a clear brand identity that sets you apart from the competition, you can carve out a unique space in the minds (and hearts) of your customers. This distinctiveness helps you attract new customers and continually build a