In the hospitality business, every exchange offers a chance to get to know your customers better. This article from TD Bank will explore how restaurants stand to benefit from an updated POS that is able to collect, analyze and store important customer information.
Although rarely considered, diners at a restaurant produce a large amount of data each time they go out for a bite to eat. What’s being ordered? How much are they spending? Do they pay cash or use a credit card? And, among the most important questions: Which customers are most loyal, and how can they be encouraged to remain so?
There’s tremendous opportunity to be gained from gathering and analyzing the patterns and habits of consumers. This can take the form of simple tasks, like changing the prices of particularly in-demand menu items or helping with inventory. Customer data can also drive more involved efforts, like rewards programs. Rewarding repeat customers with a discount or even a meal on the house after a certain amount of repeat purchases can drive the kind of loyalty that sustains restaurants.
But none of this is possible unless you're able to collect, analyze and store the information. If this rich data isn’t being tracked, managed and utilized, it’s quite possible that restaurants are leaving money on the table in terms of lost opportunities to generate customer loyalty and increase business efficiency.
Take, for example, the issue of appealing to millennials, a customer base whose spending power will continue to grow year-over-year for the foreseeable future. A recent TD Bank survey conducted at the National Restaurant Association show indicated that 85 percent of restaurant professionals believe that innovations such as mobile contactless payment and loyalty programs help them market their business to the millennial consumer base.
Given millennials’ preference of electronic payment methods, this statistic is unsurprising. This was echoed by another similar finding in the survey: only 13.5% of these professionals said that most of their customers used cash. The rest reported most of their transactions come from mobile pay or credit cards.
There’s a hidden benefit here, in that the movement away from cash means that customer data can be more easily tracked and stored by POS systems. By switching to frictionless payments, customers are beginning to prefer a method of payment that’s faster for them, but also allows for more convenient storage and analysis of their purchasing data.
A relatively simple way to quickly gather customer data is by incorporating a POS system with expanded capacities for data collection, inventory tracking and even payroll. A robust POS system will not only allow for a positive customer experience, but also help the restaurant by streamlining the data management process.
The question then becomes finding a POS system that ensures this valuable data isn’t going to waste. Opportunities abound from these data points; from loyalty programs that encourage frequent diners and mobile apps for reservations at eat-in restaurants to pre-ordering at quick service restaurants (QSRs) and access to data on consumer trends. Yet so far, not enough restaurants are tapping into the opportunity to increase their traction with millennials and encourage repeat consumers. Only 42 percent of respondents owned and used a POS system that offers a loyalty program as part of its capabilities. This number seems to represent a lost opportunity: loyalty systems encourage occasional customers to become regulars, and make frequent visitors feel valued.
But these are far from the only benefits, as modern POS systems are well-removed from yesterday's simple cash registers. Almost all enhanced POS systems today can handle functions related to payroll, allowing employees to clock in and clock out while tracking hours and calculating wages. An up-to-date POS system will also have quick and seamless integration of widely used contactless payment methods. Many offer handheld versions of their credit card pin pans and scanners, allowing for business that occurs offsite (for example, at a market or tradeshow) to be recorded and analyzed seamlessly.
Restaurants would benefit from ensuring they are getting their money’s worth from the POS system and its offerings. POS systems are responsible for a restaurant’s competency in areas including payroll, transaction speed, trend analysis and loyalty programs. Now that so many tasks and functions fall to the point of sale system, investing in a POS system that's the most capable one on the market offers a leg up on the competition. The restaurant business is an inherently competitive one, and utilizing the data generated at the POS to maximize loyalty and sales is an easy decision for forward-thinking restaurant owners who are ready to maximize today's POS technology.