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Restaurant Loyalty Programs: Segment Data to Send Effective Targeted Promotions

Previously, Hospitality Technology magazine posted part one of this two part series titled: Restaurant Loyalty Programs: Use Data Analytics to Drive Visits.

In part one, HT revealed that our 2016 Customer Engagement Technology Study stated that 84% of operators are driven to invest in customer engagement technology to enhance the experience and satisfaction of their customers, including loyalty programs.

HT also revealed that 41.3% of restaurants are already using a loyalty program and 27% are planning to implement one within the year. In this second part or of our two part series, HT will explain how operators could use the data captured through these programs to target customer segments with special offers, drive an increase in visits and more.

Segment Data Effectively
The possibilities of how to segment loyalty data are seemingly endless, and the more detailed the data collected, the more opportunities. Using Turnstyle, CafÉ Adobe can see visitor frequency and segment by demographic, age and gender. It can track different demographics and segments by time of day or day of the week visited, and it can also target customers who have not been to the restaurant in a while, Bobochoff says.
Not Your Average Joe’s also looks at a variety of segments and reports as a way of targeting promotions based on customer behavior and of measuring the effectiveness of each promotion. Not only does it segment guests by location and daypart, but it also targets programs based on activity and purchases. In the past, it offered a specific promotion to customers who ordered wine with dinner and another to older clientele who come in for lunch and are more value driven, Gotti says.
“We also track what the cutoff seems to be for when a guest is likely to lapse and we won’t see them for a part of the year, so we created a recovery program that hits them with promotions to try and get them back in,” he notes. “We also track customer preferences and will let them know when we have a favorite offering back in.”
The promotions are sent through email, but Not Your Average Joe's is also getting more involved in social media and the use of digital video. It uses Sprinklr to help segment customers on social media, email and more to generate and target relevant ads.
“More and more we are leveraging look alike capabilities through social media and have probably matched 80 percent of our database through social so far. We are creating look alike audiences and subsets that are community specific,” Gotti says, explaining the company also uses Crowdly, a word-of-mouth marketing tool to amplify their digital efforts by taking people who respond to the creative and turning them into a targetable audience in the future.
Shari’s CafÉ and Pies also monitors customer behavior and rewards them when they reach a certain number of points. Paytronix allows the company to see what people are ordering, the time of day they are coming in and more. For example, it can pull a report of the top 10 pies people are ordering, Henderson says.
“Most companies with limited time offers might market to the masses, but what if someone doesn’t come in at that time of day or order that type of food? In this day and age, it’s important to gather as much information as possible to tailor a program to the behavior you want from the guest. I’m more inclined to come back if the offers pertain to me,” she explains.
Similar to Not Your Average Joe’s, Shari’s CafÉ and Pies also segments customers into different groups based on collected data. The company also asks for customers' birthday information and offers them a free slice of pie for giving the additional information, she says.
“It takes time to build and gather the data, but as time goes on you get a larger amount, and doing segmentation has been really gratifying to see specific promotions to certain groups and the positive response we see from it,” Henderson says. 
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